12 Case Study

The Gamble Eva Peters is packing the contents of her New York City apartment and thinking about her new job. Monday morning Eva takes over as the President of the Lottery Corporation (LC) in Java, Canada. Eva has worked in the gaming industry for years and has been very successful in her latest role as CEO of Ex- Works, a manufacturer of gaming equipment. Her take charge, no-nonsense approach turned this near bankrupt company into one of the leading manufacturers in North America. Despite her experience and successful track record Eva is having doubts about her next challenge – what will she do first? – what will it be like to work in the “back woods” of Canada?

You’ve been hired as Eva’s Executive Coach to help her determine the best approach to turning the LC up-side down. The LC is an independent body created to administer and operate lottery and gaming activities on behalf of the Java Province. In addition to offering lottery games and overseeing video lottery operations, LC’s mandate includes the management of gaming technology, gaming design and financial and security controls. LC has been very successful since its creation 25 years ago.

Running the provincial lotteries has basically been a ticket to print money and annual revenues are well over the 100 million dollar range. However, their playing field has started to change. Competition for the “entertainment” dollar is on the rise and market research has shown that “gaming” competes with other forms of entertainment (e.g. movies, theatre, restaurants) for the consumer’s dollar. There are also more opportunities for people to meet their gambling needs – the number of National Games has increased (Lucky 7, 649) and e-gaming, that allows you to play 24 hours a day, is on the rise. Some experts in the field prophesy that the day of the scratch and win ticket may soon be over. For the first time in its history the organization is at a cross-roads and must make a strategic decision regarding the business they are in – do they “gamble” and remain a “lottery” organization or do they enter the quickly expanding e-gaming industry.

Although LC has a profitable track record the Board of Directors has become very dissatisfied and are ready to force big changes in the organization. They are convinced that the margins could be much higher and that the organization is not efficient or well-managed. In a rare and bold move the Board commissioned an Efficiency Study on the operations of the entire organization. Shortly thereafter the President of 25 years resigned. The Board is ready for significant change in the operation of the organization and are quickly growing impatient.

The culture of the organization has been described as warm, friendly and staff oriented. People like to work at LC. It’s the type of environment where VP’s know staff by name and take a personal interest in the well-being of individuals. Abnormally low turnover has resulted  in a workforce that is very experienced and long tenured. This low turnover is attributed in part  to their staff-friendly culture and their very strong preference for promoting from within.  However, pockets of staff aren’t as positive and describe the culture as stagnant, complacent  and not performance driven – basically a culture of entitlement. Some would say that motivation to perform is non-existent.

Most of the Senior Management team have been with LC for several years. When the organization was formed 25 years ago the most experienced and senior people filled the Executive roles and for the most part have remained with the organization since. A few of the VPs are new – one actually worked her way up in the organization from a mail clerk. Another left a partnership position in a top Toronto ad agency in pursuit of a simpler life. The Senior team is relatively cohesive although the beginnings of a rift between the “old guard” and the “new blood” is developing. The old guard is reluctant to dive into the e-gaming field and abandon the lotteries that have been the life-blood of the organization. The new blood is convinced that everyday they aren’t in the e-gaming business is a day wasted. After all, a lack of strategy has never stopped them in the past and everything the LC has tried has been successful – why would e-gaming be any different? The “power games” and politicking between these two groups are starting to take there toll on the organization. The day the President of 25 years (the only President the LC has ever had) announced his “retirement” people were crying in the hallways. Since his departure 6 months ago the organization has been in a holding pattern – some people are anxious to move ahead and others are terrified of what may be coming next. ​

Lesley McCannell, B. A.(hons.), MBA, CPHR Educational Consultant – ePortfolios and Internationalization, Teaching and Learning Commons Faculty, School of Business Internationalization Lead, School of Business