Supreme shake-up - Peart aiming for entrepreneurial infusion at SVL
On January 1, new staffing and operational arrangements will take effect at gaming and lottery company Supreme Ventures Limited, with the intention of shaking up the business model for greater gains.
Having made clear his emphasis on growing the sports betting segment to rake in more revenues from the expanding sector, board chairman since June, Gary Peart, is adamant that other areas of the business must change if the listed business is to grow beyond its present yearly income of $63 billion and profits of $2 billion.
The streamlining of the operations could also involve a selling down or disposal of SVL’s stake in the gaming lounge ownership and operating business. In a departure from previous years of expanding its lounge subsidiary Acropolis, the company has in recent years cut back to operating one lounge at Barbican in Kingston.
It still owns the Coral Cliff trading name and the building that houses that lounge, which is operated in Montego Bay by another company through a lease arrangement with SVL. Peart is mulling the direction of the lounge business and is not ruling out a complete exit, conceding that SVL has not done well in that market.
In an interview with the Financial Gleaner in which he discussed several areas of SVL’s operations, the chairman presented options for dealing with the segment.
“If somebody approaches us, we would be more minded to look at a transaction along those lines. We might seek different opportunities for a set-up similar but not exactly like that. We want to put our people where they are most capable and best suited,” he said. “The lounge business is an area where our skill sets are not where they should be. Whether we grow it, or sell it or partner, is an area we need to look at.”
To achieve the maximum revenues and profits he is gunning for, the SVL chairman is not shying away from shaking up the management and organisational structure of the business, and, in the process, infusing an entrepreneurial spirit into some divisions, which must now earn their keep with an eye on possibly spinning them off as subsidiaries.
For starters, more of the technology services needed to drive its main revenue and profit focus of online betting, are being kept in-house, and a shared services division has been created to sell services, not just to the main company and its subsidiaries, but to a clientele it must build outside the company as well.
“When you calculate the amount of money we pay to technology providers, its north of US$20 million per annum, from our top line right down to our admin expenses. If we find a way to own our own technology, software, etc, there are significant savings that can be had,” Peart says, adding that SVL is looking at acquiring a range of proprietary software since technology is the future of the business.
A specific stand-alone technology offshoot is not being created now as technology is being rolled up with other shared services, including security, human resource management, accounting, marketing, etc, in a new division headed by Dennis Chung, co-CEO of main subsidiary Prime Sports, with Heather Goldson as deputy CEO.
“We don’t want to become software developers, but certainly, based on the number of transactions we do, we see where significant efficiencies can be garnered,” he said.
Peart adds that the creation of the new income-earning division, which takes effect on January 1, removes the original thought of reducing staff numbers as long as the unit can earn its keep by selling the services within the SVL group and externally.
“If they are really that good, they should be able to go out there and sell those services. If the heads of these different services are entrepreneurial, with the structure created, they have effectively started their own business,” he said.
The SVL chairman notes that the new arrangement is essential for managing expenses.
“You don’t have a culture of expenses, every quarter you have to justify your existence. If it works, well you never know, we might have to spin off another subsidiary just for this,” Peart suggests.
He adds that in pursuing this model of growth, SVL is also finding new ways to incentivise its workers, some of whom may go on to develop and run their own businesses. “And that is okay,” he asserted.
As to his personal views on leadership: “I have to imaginate every day, motivate people. One of the things I have learnt about being a leader, if you’re are predictable, that predictability can flow throughout the organisation and ultimately morph into complacency, or the people being stationary or static,” said Peart.
“So, it is always good to get people to know more about themselves, push themselves more; but on the flip side, you don’t want to pull them too far and break them.”