Crisis Management in Casinos
On my long list of subjects for this column, crisis management has been patiently waiting for its turn to see the light of day in print. It would never be more relevant than right now I guess, in what we could certainly call the biggest crisis of our lifetimes in many countries around the world. I haven’t felt my freedom restricted since my days in the army back in 1987. I believe this holds true for most of us, having lived the best part of our lives in absolute freedom that we so much take for granted, that a quarantine for example comes as a serious shock to the system. The threats to “our way of life” in the past decades came from three main sources: natural disasters, financial crisis and terrorism. As for the average Joe, all these three were out of our control. There was not much people could do to stop or influence these events, thus we regarded them as random acts that we have to live with, but that wouldn’t normally change our normal behavior, as most people don’t constantly live expecting bad things to happen to them.
The story of crisis is a slightly different one for businesses. While a business as such would not organize its activities based on random and very infrequent threats, it must have a plan to deal with these once they happen. On paper. In real life most businesses don’t have such plans and when crisis hits, they take random and ad hoc actions many of which can actually do more harm than good.
This time around the nature of the crisis is very different and its effect is prolonged it seems. In the wake of a natural disaster or terrorist attack the damage is done in a short period of time and most of the efforts are concentrated on recovery. A financial crisis will set back a business by a certain percentage for a longer period of time. All above mentioned scenarios will cause damage but will ultimately let
things get back to their normal flow and the business will recover. There is a breaking point however, and when the crisis has a serious impact on the earning capabilities of the business for a prolonged period of time, the chances of recovery decrease rapidly if the business doesn’t have enough financial reserves to see it through several months of zero income.
So, let’s see what a casino can do in times of a crisis. The following table sums up the main avenues of action to be taken:
Facilities Product • Partition off space • Sell equipment • Schedule maintenance, renewals, modifications • Introduce new, innovative product
Time Labour • Part time workforce • Lay off employees • Schedule training • Streamline non-productive procedures
Customers • Segment database with personalised offers • Complimentary service offering • Build loyalty • Review pricing • Increase promo activity
Many of these have to do with operational optimization as well, and a casino should have several scenarios for implementing some or all of these points. Obviously, the list is not exclusive and there could be other measures to take as well depending on the situation and different circumstances of the business.
The COVID situation is novel in the sense that the measures to contain it include in effected countries shutting down points of transmission. These are mostly public places where people meet and get close enough to each other for the virus to transfer from one person to another. A casino is the ideal ground for these infections with the number of instruments such as chips, cards, slot machines, etc. being touched by a multitude of people. Thus, casinos should logically be among the first businesses to come under restrictions. And when there is no such a rule from authorities, people tend to stay away anyway as they mostly understand the way diseases are transmitted. Most expect the situation to last several months, so some casinos lobby to have restrictions lifted, and there are countries, like Hungary for example where most restrictions don’t apply to casinos strangely.
The bottom line is to be prepared. Panic is the worst enemy of a business and of organized processes in general. This probably comes late as an advice but could serve for the next crisis if human memory wouldn’t be so painfully short. When things are going well, the last thing people want to think about is problems and crisis. But only by being prepared for those periods of difficulties can a business ensure continuity and ultimately survival. Have a plan. A financial crisis will set back a business by a certain percentage for a longer period of time. All above mentioned scenarios will cause damage but will ultimately let things get back to their normal flow and the business will recover. “
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