When Gary Loveman became Harrah’s COO in 1998, he implemented an evidence-based model of management where they used data collected from customers to develop new marketing strategies to enhance their bottom line. Loveman created a culture where ideas were to be tested against the data before implementation.
1. Obtain customer data
2. Analyze data to develop marketing strategies
3. Use life-time value to identify core customers
4. Gather specific information about customers and then use that data to create strategies/promotions to appeal to them
5. Reward employees for making customer service a priority
This approach of using data to develop strategies enabled Harrah’s to implement several successful changes outlined in the last blog post on Loveman’s role in taking Harrah’s to a new level. The data collected through newly developed techonologies (which Harrah’s eventually patented), provided hard evidence for Loveman to base decisions on rather than using popular management theories or trying to mimic their competition. This proved to be a very successful strategy for Harrah’s, and an effective leadership style for Loveman.
Thus, Harrah’s is a case where evidence-based management was used and proved to be effective for their organization. This article also illustrates how data mining can be an effective tool when used properly (i.e. letting the data tell the story rather than using the data to prove the story you’ve already created).