Profile: How Harrah's Found Its Groove

In 1998, CIO John Boushy was unhappy to find his IT staff was leaving Harrah's Entertainment at the rate of 35 percent a year. Today, turnover is down to a scant 9 percent. How did he do it?

When Boushy and Eileen Cassini, vice president of IT Services (which includes IT human resources), began to confront the turnover issue, Boushy thought increasing salaries would keep people from taking other jobs. But both remembered when they had happily stayed at jobs despite the pay. The real question, they realized, wasn't "Why are people leaving?"; it was "Why are people not staying?"

"They sound like the same questions, but they are not," says Boushy, for they lead in different directions. Instead of pay, they redirected their thinking to creating "a culture and environment where people want to stay."

Boushy and Cassini turned to two well-known theories of human motivation: Abraham Maslow's "hierarchy of needs" and Frederick Herzberg's "two-factor theory." In Maslow's hierarchy, higher level needs such as the need to learn and realize one's potential—two factors that drive high performers—only receive attention if basic needs such as physical comfort, safety and acceptance are met. Herzberg's theory, on the other hand, says external conditions that must be met to prevent dissatisfaction—such as salary and working conditions—must be considered separately from internal factors, such as achievement and recognition, which motivate people from within. Boushy and Cassini synthesized these ideas: Take care of basic needs, and you'll avoid dissatisfaction; focus on intrinsic needs, and you'll have an eager, excited IT staff.

They first mapped such factors as compensation and the work environment to Maslow's hierarchy, to identify potential dissatisfiers and motivators. Then the IT management team tackled those dissatisfiers: Base salaries were raised 5 to 7 percent to competitive levels, and a dual technical and managerial career track was created.

At the same time, they addressed intrinsic motivators such as recognition, achievement, and self-actualization, and broke them down into four categories.

Communications: IT management started to publicize and discuss current projects among their staff, focusing first on cool technology to grab attention, then on the value these projects bring to Harrah's business. This internal public relations effort spurred the quantification of the business value of IT work, and helped non-IT staff appreciate the importance of the IT effort at Harrah's. Boushy's team also sought out to win awards and media attention, which provided further recognition for the organization's achievements.

Choice of projects: As discussing business value became part of the culture, Harrah's IT management team changed its way of staffing projects. Rather than assign people, management publicized new projects, opened up a discussion of its business value, and then encouraged qualified staff to volunteer.

Career development and job mapping: To establish qualifications, Boushy's organization developed a "career progression matrix" which listed the skills required by every job, and then launched a procedure to certify that an IT staff member met the requirements for the job. Training was boosted to more than two weeks a year on average per employee.

Choice of where to work: Employees are now allowed to work at home, if they meet certain minimum qualifications.

Within a year of fully implementing this program, turnover dropped to 13 percent a year. Today, undesired turnover is only 5 percent. No wonder Cassini is reluctant to change Harrah's HR strategy, regardless of economic conditions. "It's working for us," he says. No question there.