Friday, August 28, 2009

Efficiency “Tells”

One skill almost all good Poker Players possess is the ability to read their opponent’s behaviors and actions; this skill is called reading “poker tells.” A “tell” is an action or habit that is indicative of a Player’s hand, good players will often spend as much time watching their own behaviors in order to mask their “tells” as they do watching their opponent’s.

When I visit a Casino Property as a Management Consultant I also look for “tells” on how efficient overall operations are, as it is rare that one area of expense is managed well while another is not – think about it, how many times have you seen a Kitchen which consistently returns excellent Food Cost percentages be completely out of whack on wage line? A little out maybe, but with efficiency, I believe, one good thing usually goes with another.

So what are some of the common “tells” on Casino Operations efficiency? While I am sure everyone has their favorites, below are some classics, this time in the area of Food and Beverage. And remember, no "tell" is for certain, and neither are these:

PM Requisition Activity. Before I visit with the Chef I like to take a little trip down to the Warehouse to discuss the number of daily requisitions being generated by each Food Outlet. Most kitchens will have a standard morning order (Specialty Rooms such as Steakhouses should put in their orders the night before), but a well-run outlet should generate no more than one or two additional orders throughout the day. The Requisition “Tell” - too many PM requisitions are often indicative of organization and planning issues in the Kitchens – and may be driving too much Warehouse staff as well.

Scales on the Line. This is an easy one; if you see a lot of food scales on the kitchen line then the Cooks may be handling the majority of portion control. When things get busy, they go visual. Bad. The Line Scale “Tell” – Prep activity may need to be evaluated; portion control may be inconsistent with volume fluctuations.

Breakfast Fruit Plates. This one is a real classic, order the fruit plate at breakfast, then evaluate what is served to you in relation to the menu price. Produce is pure expense; if they bring you a quarter of a fresh pineapple with your $4 fruit plate then you will have your answer. The Fruit Plate “Tell” - too much produce = too much $$$.

Lunch Specials. Visit a Restaurant running specials late in the lunch meal period and see how many are sold out. In this case, sold out is good. The Lunch Special “Tell” – sold out late usually indicates solid planning and food cost management.

Beef Soup at Dinner. Another food cost classic, order a soup with a base made of beef stock in a Restaurant featuring steak or Prime Rib. How thick the soup is will often indicate how good the planning and production is, using up materials like Prime Rib in soup stock will hit food costs hard. Stew-like consistency is really bad, unless of course, you have ordered the stew. The Beef Soup “Tell” – too thick is too much.

Beverage Station Condition. Here is one for Casino Beverage, if there are self-service beverage stations on the casino floor check to see how clean and stocked they are between 5:00PM and 7:00PM – clean stations during this heavy arrival time generally means that the Cocktail Servers are out on the floor delivering that first drink fast. Yes, I know that the classic “tell” here is to walk the low-denomination slot banks to see how many self-serve cups are being used, but I’m lazy. The Beverage Station “Tell” – clean and stocked self-service stations in the early evening = first drink in hand fast = increased Guest satisfaction with Casino Beverage.

OK, I'm not really lazy (although my wife may occasionally disagree). Every area of Casino Operations has a unique set of “tells” on overall efficiency, today I have shared a few classic favorites with you while picking on the area of Casino Food and Beverage. I am sure you have your own favorites as well, if you want to share yours please drop me a line!

Thursday, August 27, 2009

Calculating Hotel Departures

Here is a quick tip for calculating current day Hotel Departure counts:

Yesterday's Rooms + Today's Arrivals - Today's Rooms = Today's Departures

Try this formula the next time you need to forecast departures, it may save you a little time.

Wednesday, August 26, 2009

Hotel Occupancy and Optimized GRA Staff Planning

Over the course of my casino career I have enjoyed the opportunity to work in almost every major U.S. Gaming Market, including Las Vegas, Atlantic City, Chicago, Reno / Tahoe, Tunica, and most places in between. The one major market I had never worked in, or, for that matter, had never even visited before, was Laughlin, Nevada. That all changed recently when I got a chance to work at what the locals call “The River” for a couple of weeks.

Coming into a new market is always interesting and Laughlin proved to be no exception. It quickly became apparent (at least to me), that the current economy has had a dramatic impact on area hotel room rates and has forced Laughlin to become somewhat of a “value” market (along with being somewhat of a seasonal market as well). I also noted that many Laughlin hotels had high (80%-90%), weekend occupancy rates but dramatically lower (40%-50%) mid-week counts.

There are some interesting labor analysis concepts that can be applied when hotel occupancy swings widely from day-to-day, particularly in the area of optimizing Hotel Housekeeping room credit targets and with the concept of “dragging” dirty rooms from heavy departure days to lighter departure days for cleaning. Volatile day-to-day arrival / departure swings create the need for differing credit targets for check-out and stay-over rooms. For example, a 16-credit per shift house standard results in approximately 24 minutes per checked out room, given that a normal 8-hour Guest Room Attendant (GRA), shift including a lunch, breaks, and cart stocking time. The time to clean a stay-over room, however, is usually 35% or so less than a check-out, which results in a credit target of approximately 24 credits per shift using the same GRA availability described above. Note – the credit targets and employee availability numbers used here are for illustration purposes only; you will need to carefully evaluate the time required to clean both check-out and a stay-over rooms according to your hotel's standard operating procedures and to ascertain the available GRA time per shift available to clean in order to develop accurate credit standards.

Once you have an approved credit targets for both check-out and stay-over rooms the normal methodology for determining the required number of daily GRA labor hours is to use the volume indicator Current Day Departures to drive your daily Check-Out credit standard and to use Prior Day Rooms Sold – Current Day Departures to drive your daily Stay-Over credit standard. Divide each room type total by their respective credit target and sum the two results to return required number of daily employee shifts required to clean the house.

If your Hotel has high weekend occupancy highlighted by heavy Friday arrivals and large numbers of Sunday departures then you may find that you have labor efficiency opportunities on Saturday due to the increased volume of stay-over rooms available to your GRA staff on this day in relation to scheduling.

The concept of dragging check-out rooms will add another labor analysis dimension to the mix - dragging rooms will potentially allow you to develop daily standards that will better “fit” employee schedules. Dragging rooms can also be effective in controlling overtime expense, for as most GRA schedules are loaded for heavy occupancy days, in some cases there are more total rooms to clean than staff available when the house is full. In Laughlin the heavy check in day was Friday and the big check out day was Sunday (while mid-week departure counts dropped dramatically). Spreading a percentage of Sunday check-out rooms to later in the week creates a more even workload while preparing for the next heavy check in day (in this case, the following Friday), and may better allow you to provide work for Part Time GRAs working mid-week.

To create a standard for dragging rooms first establish the number of rooms to be drug by reviewing the daily arrival patterns and then analyze employee schedules to determine which days will best accommodate the extra workload. Deduct the number of rooms to be drug from their normal departure day and add these totals to the departure counts for the target days. Remember to allow for some time in the current day for either House Persons or GRAs to remove trash from each room to be drug, and always make sure that enough clean rooms are ready for next day arrivals throughout the week.

A caveat on developing a drag rooms standard - you should look for seasonal / event trends that will potentially disrupt the normal daily arrival / departure patterns and make adjustments to your daily drag percentages as required.

I had a great time in Laughlin and had the opportunity to meet with some really good Casino Operators while there. If your hotel has similarly wide mid-week to weekend occupancy swings then the use of individual credit targets for both check-out and stay-over rooms will result in more accurate daily labor standards for your Housekeeping GRAs. The dragging of check-out rooms may smooth out your GRA work flow, provide additional opportunities for part-time staff, and result in less overtime expense for your Property.

Wednesday, August 5, 2009

Analysts – Hiring for Potential versus Skill

Here is an interesting overview by Dr. Charles Handler on the relevance of hiring for potential versus skill. Reading it I am reminded of the many times I have been asked by Casino Organizations to interview their analyst candidates, usually as a part of the final selection process prior to an offer being made. As an interviewer I always looked for specific traits in an analyst candidate – the ability to communicate effectively using a variety of mediums, a background exposed to critical thinking, and, most importantly, the ability to “sell” a specific idea or viewpoint. In short, I generally espouse a strategic view of candidates during the hiring process.

Dr. Handler has challenged my strategic thinking by making an excellent tactical point on the need to understand the culture of the hiring company when determining which candidate traits actually represent the best “fit.” For example, if the hiring company does not possess the mentors required to develop a candidate into a polished analyst then raw potential will usually remain just that – having not actually accomplished anything. Also representing the tactical argument is the pain threshold of the hiring organization. In cases where a Casino is desperate for analytical output I would recommend that a more experienced candidate be brought on board so that already-acquired industry skills can be put to immediate use. Short of bringing in independent consultants to assist the organization, the tactical hiring for skill in these cases would seem to make good business sense.

As Dr. Handler suggests, the reality of the situation probably lies in between on the hiring of potential versus skill. A careful understanding of the hiring organization’s business situation, culture, and ability to develop potential should be undertaken prior to beginning the hiring process. Knowing the correct balance of the strategic and tactical needs in advance will allow the best candidate to receive the offer.

Labor Is Your Largest Controllable Expense...

So Take Control Of It!