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Chief executive's Q&A 2017/18

IN THE SPOTLIGHT

What attracted you to Rank?

With over 25 years of experience in the betting and gaming industry, both in the UK and internationally, I am often referred to as an ‘industry veteran’ or ‘stalwart’.  In truth I love the gambling sector, always have and always will, and it is a privilege and a pleasure to be involved in determining its future direction at the helm of one of the industry’s major businesses.

Having been a non-executive director of various companies since leaving Gala Coral in 2015, I was keen to return to an executive role at a gambling company, but only if the right opportunity came along. The role of CEO of Rank has always been one that I wanted if the chance arose. In recent years, as an outsider looking in, I have viewed the Rank business as being undervalued with a real opportunity for development and growth. 

You have now been in the business for four months, what have been your first impressions?

Since joining I have been made to feel very welcome and I have met a lot of committed and hardworking colleagues who are focused on making this business more successful.

Over the last four months I have visited many of our venues, our digital operations in Gibraltar, the Enracha business in Spain, the customer solutions hub in Sheffield, and spent a great deal of time with all our leadership teams.

Based on what I have seen and experienced, we need to be better across four key areas by 1) increasing our focus on the customer; 2) growing our digital business; 3) driving cost efficiencies; and 4) improving our organisational capabilities.

More recently I have identified the detail behind these four areas which will form our key priorities over the coming year.

Increasing our focus on the customer

  • Continue to support the recently rolled out 'Project Experience', a standards setting and training programme focussed on delivering the optimal customer experience in our Mecca and Grosvenor venues;
  • Continue with the good work already started on customer segmentation at a venue level within the Grosvenor estate to provide the right experience to the right customer, moving away from a 'one size fits all' approach;
  • Increase the focus on offering a wider portfolio of entertainment within our Mecca venues to attract new customers and diversify our customer base;
  • Significantly increase data driven customer insights within the business and use our data to ensure a stronger performance orientation;
  • Be forensic in evaluating capital investments in our venues and in our product offering; and
  • It is essential that we create a sustainable business and all initiatives will be viewed through a sustainability lens to ensure we are growing a business founded on responsible gambling.

Growing our digital business

  • Continue the work around optimising user journeys on our digital sites to make sure they are frictionless for customers;
  • Our delayed omni-channel service, Grosvenor One, will be delivered across the estate within the second half of the year. This is critical to growing both our Grosvenor venues and digital business;
  • Having delivered Grosvenor One we will be reviewing the minimum viable omni-channel service for Mecca customers;
  • Cost savings delivered within the transformation programme will be reinvested in marketing within the digital business to increase customer acquisition and loyalty; and
  • The acquisition of YoBingo provides an opportunity to significantly drive growth within the Spanish market under both the Enracha and YoBingo brands.

Drive cost efficiencies

  • Our central costs are too high for a business of our size. We will be reviewing central costs to ensure appropriate sizing and control going forwards; and
  • The transformation programme will have a key focus on cost efficiencies across the Group.

Organisational capabilities

  • Central to the transformation programme is the objective of creating a better quality, more effective organisation; and
  • The programme will create opportunities for our best people to develop and grow and improve the attractiveness of Rank as an employer of choice.

Do you see a need to change Rank's strategy?

Rank’s strategy as defined by the five pillars is right for our business and I agree with the Group’s ambition. That said, with the backdrop of a disappointing performance in 2017/18, we must move quickly to realise the significant underlying potential which I have now seen first-hand since joining the Group in early May.

How will you ensure Rank realise this underlying potential?

As highlighted earlier, we need to improve the organisational capabilities to deliver our strategy and we will do this through the establishment of a transformation programme.  We have to become more efficient but we also need to grow revenue so the transformation programme will be a mix of cost savings and revenue generation initiatives.

It is a rigorous process involving multiple approvals for initiatives with overall review by the Rank executive team.

Ideas to grow revenues and/or reduce costs are identified, validated, planned, prioritised, executed and realised with tight management and measurement at every phase.

The start point is in determining the workstreams, responsibilities and initiatives and validating the P&L benefits and timetable for delivery. This programme of work has just begun and will run over the next three months.

The transformation programme will then follow a strict weekly cadence, enforced by a transformation office which will support the programme and make sure the initiatives stay on track. To help run the programme we have recruited a Chief Transformation Officer, Jim Marsh, from McKinsey & Company. Jim will join the business on 1 October 2018.

The programme will be a challenge to all of us at Rank and as yet we don’t know what the initiatives will be but our employees are best placed to determine what we should be doing to grow revenues or where we can save money. It may be in scheduling, multi-skilling, new products, procurement, central systems, digital customer acquisition, customer bonus controls, promotional effectiveness, improvements in customer due diligence processes, or estate management.

The programme will be centrally run to ensure it is co-ordinated, properly measured and it changes the way we operate going forwards by enhancing the performance culture of this business, creating opportunities for personal growth and enabling ambition to be rewarded.

The transformation programme has only just kicked off.  All senior employees will be involved as it progresses and it will shape what we do and, just as importantly, what we don’t do over the year ahead.

Where you see Rank in four years' time?

Our aim is to deliver a responsible, growing and successful business which is responsive to changing consumer needs and therefore relevant to today’s customer. We want to be an employer of choice to attract and retain the very best talent to ensure we have the  organisational capability to drive increased loyalty from our customers and to create enhanced value from our shareholders.

There is a lot to do over the coming months to get Rank fit for the future but this is exciting journey and one which the Rank team is now gearing up to deliver.

John O'Reilly, Chief Executive

15 August 2018