Gary Loveman and Harrah's Entertainment

By Jeffrey Pfeffer, Victoria Chang
2003 | Case No. OB45 | Length 19 pgs.

In 1998, 38-year-old Gary Loveman was perfectly content with his job as an untenured associate professor at the Harvard Business School (HBS). He was a popular teacher with standing room only classes in service management. He lived comfortably with his family in Massachusetts and had successful consulting engagements and executive education assignments with companies such as Harrah’s Entertainment. His prospects for his tenure review, coming up in the next year or two, looked good. Little did Loveman know that his life was about to change dramatically when the then CEO of Harrah’s, Phil Satre, offered him a job as chief operating officer (COO) of the company. After Satre agreed to allow Loveman to commute from his home in Massachusetts, Loveman took the job and never turned back. Bringing Gary Loveman into Harrah’s was not the most obvious move, and his hiring as COO caused some internal and external rumblings. Loveman had never before managed anyone apart from his administrative assistant and some research assistants. He was now going to manage 15 casinos with more than 10,000 hotel rooms, and over 35,000 employees. The company was also closing one of its largest acquisitions to date, Showboat. Moreover, the industry he was joining — the gaming industry — was not, in 1998, a common destination for MBA graduates, let alone PhD’s. It was an industry dominated by insiders who had spent their careers in gaming, working their way up from the bottom. The tasks facing Loveman as he joined Harrah’s were daunting. He had to somehow gain credibility and respect inside Harrah’s, as well as in the industry. He had to lead Harrah’s through a transition to a more marketing-focused company and help the company break out of a financial performance plateau. And he had to build a set of relationships and a power base so he could potentially attain the CEO position when Satre stepped down in five years. What could he do to accomplish all this?

Video clip: Gary Loveman: Paths to Power.

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