Mohegan Sun's new boss embracing role
Mohegan - Jeffrey Hartmann, numbers guy, has been stepping out.
He's been walking the floor at Mohegan Sun, glad-handing employees - they're his employees now, all 8,000 of them - and gathering input, the kind that flesh-and-blood people deliver when the boss seems intent on listening.
A certified public accountant long familiar with balance sheets, financial reports and SEC filings, he just might be toting a copy of Billboard or Brandweek, examples of his new taste in reading material.
The day after a January blizzard prompted some of the staff to stay overnight, he shed the suit and tie and donned a sweater, which is not to suggest he'll be working in a Hawaiian shirt any time soon. The CPA is, after all, the new CEO.
It's been barely two months since Hartmann took over as president and chief executive officer of Mohegan Sun, succeeding Mitchell Etess, who relinquished the key to the executive suite to focus on the Mohegan Tribe's outside ventures as CEO of the Mohegan Tribal Gaming Authority.
Actually, Etess kept his office. It was Hartmann, who still reports to Etess, who moved into new quarters in the casino's hotel.
Some have wondered whether there was more to the shake-up than Etess' stated desire to develop new revenue streams for the tribe. Given the authority's need to refinance debt and Mohegan Sun's emphasis the past couple of years on cost containment — salary rollbacks, layoffs, etc. — might investors be more comfortable with a numbers guy at the casino's helm?
"It's really a case of Mitchell deciding he wanted to move on," Hartmann says. "It was about where he was and where he wanted to go. It's really no more complicated than that."
Etess, the Sun's CEO for more than six years, and Hartmann, chief operating officer the past six years and chief financial officer for eight years before that, have been partners since the place opened in 1996.
"If you polled people who know us, the vast majority would say Jeff and I have totally morphed," Etess says. "It's like we've flip-flopped. I tend to be the one talking about finances all the time and he's been addressing the marketing."
Bruce "Two Dogs" Bozsum, chairman of the Mohegan Tribal Council, which serves as the authority's management board, said there was precedent for the change. The late Bill Velardo gave up the casino CEO's post in 2004 to concentrate on his duties as CEO of the authority, making way for Etess, then the casino's executive vice president of marketing, to ascend to the casino's top spot.
"Over time, Mitchell was getting too stretched out," Bozsum said of the latest change. "It's hard to stay focused on everything that's inside the walls of Mohegan Sun and on all the corporate stuff, too. Mitchell did a great job, but I think we were pushing him too far. It was a good move."
With the change, Etess says, comes a renewed commitment to increasing revenues as opposed to solely containing costs. "It's time to get out of survival mode, and this structure gives us a better chance to do that," he says.
Hartmann thinks it's possible to do both, to control costs and grow revenues at the same time.
He quotes from Mohegan Sun management's bible, "Built To Last," the 1994 bestseller taken to heart by Velardo and his successors: "Chapter 1, shattered myths, the 'Tyranny of the OR.'" Visionary companies, the book asserts, "do not brutalize themselves with the … purely rational view that says you can have either A or B, but not both."
But how, at this point, can Mohegan Sun increase revenues?
There are "regional pockets" of the market that can yet be tapped, Hartmann says, and greater emphasis, marketingwise, can be placed on the breadth of the casino's offerings and the quality of service it provides its customers.
"We can focus on the destination," he says. "This is a one-of-a-kind facility. In my opinion, it will not be replicated in the next 15 years because the cost of financing casinos has gone up and because equity investors are seeking higher returns."
While the economic downturn has favored so-called "convenience" facilities that offer little more than slot machines, the recovery offers promise for the destination resort casino, with its full array of gaming and nongaming amenities, Hartmann says.
Convinced that the demand for more hotel rooms exists, Mohegan Sun continues to pursue a partnership with a hotel developer and a revival of expansion plans shelved in 2008. "We see the framework of a deal on the horizon," Hartmann says.
Mentors: Etess, Velardo
For the numbers guy, the prospect of becoming CEO was daunting.
"There's a distinct difference between managing and leading," Hartmann says.
He took a couple of days to consider the promotion, meeting with a career coach.
"Mitchell gave me the time to do it, which is symbolic of our relationship," Hartmann says. "It's a big commitment to lead 8,000 people."
But, it turns out, leading is not so foreign a concept to Hartmann, who co-captained the Eastern High School football team in Voorhees, N.J. He played center and linebacker. From middle school on, he held offices in student government.
At Mohegan Sun, he's had the examples of Etess and Velardo, who was a mentor to both Etess and him.
"He was very important in my life," Hartmann says of Mohegan Sun's first CEO. "What I learned from him helped me as much with my spouse and my kids as it did in the business. I realized that after he left."
Hartmann reconnected with Velardo when Velardo, who had left southeastern Connecticut for Las Vegas, returned in 2009. He died that November.
"He was a great guy; he always had time for the employees," Hartmann says, locating a folder that Velardo used to teach from. "I learned from him the importance of being patient in stressful situations."
Hartmann strives to keep interviews in positive territory, and exudes confidence and stability, a trademark of Mohegan Sun management. He'll lead by consensus, he says, "not 100 percent consensus but sufficient consensus." He's trying to have more dialogue with "team members," fewer meetings, less e-mail.
"Meetings and e-mail can consume you," Hartmann says. "I tell people, 'If it's really important, call me. Better yet - if you have an idea - come see me.' "
The biggest change in making the transition from COO to CEO, he says, has been disciplining himself to walk around and say hello to employees, to sound them out. So, what's he been hearing?
"They're telling me they like it here, they like interacting with our guests," he says. "I ask them how I can help them do their jobs better. Here's one simple thing: Let's interact with each other more civilly. It doesn't cost a penny to show each other respect and dignity, regardless of what a person's title may be or the size of his paycheck."
Here's another Hartmann initiative that won't tip the balance sheet: He's called for more up-tempo music on the casino sound system in the evenings, a nod to the younger clientele on hand at that hour.
A risky proposition
Passion's no stranger to the numbers guy, either.
"The thing that's amazing about him," Etess says, "is that he's able to be extremely involved in his community and with his children despite how much he devotes to Mohegan Sun."
Hartmann is involved in the Old Lyme Little League and has coached youth baseball and basketball. He also chairs the board of the Connecticut Sports Foundation, the nonprofit that raises money for cancer research and to help families of cancer patients. His own mother is a breast cancer survivor.
"Jeff is one of those special people you meet along the way in your life," says John Ellis, the former New York Yankee catcher who founded the sports foundation. "When we joined with Mohegan Sun, Jeff and Mitchell Etess became an integral part of the foundation. I asked Jeff to become chairman, to lead us into the future and build our endowment. He's a good fishing buddy, too."
"I always wanted a boat," says Hartmann, who's now on his third one, a 25-footer with a center console. His two sons, ages 12 and 10, fish with him. His two girls, ages 18 and 16, are apt to pursue careers in music, not finance.
His wife, Marisa, was the one who advised him to go for it.
It was 1991 and Hartmann was toiling at Price Waterhouse, the accounting firm, and living in a Manhattan apartment on 34th Street, between Park and Lexington avenues, when Al Luciani, from something called Foxwoods, called with a job offer.
"I might have made partner," Hartmann says, referring to the firm.
Instead, he joined Foxwoods' first management team, which assembled in a trailer. Foxwoods the casino had yet to be built.
"I kind of owe it to my wife," he says. "She said go for it."
Hartmann broke the news to his parents, the risk-averse Hartmanns of Voorhees, N.J.
"Hey mom, I think I'm going to take a job with the Mashantucket Pequots … in Ledyard," he remembers saying, then adds, "I've led a charmed life."
MOHEGAN SUN'S TOP EXECUTIVES
1995: William J. "Bill" Velardo, executive vice president and general manager
January 2000 to August 2004: Velardo, president and chief executive officer
August 2004 to December 2010: Mitchell G. Etess, president and chief executive officer
January 2011: Jeffrey E. Hartmann, president and chief executive officer
Name: Jeffrey Hartmann
Hometown: Voorhees, N.J.
Education/background: Bachelor's degree, Rutgers University; certified public accountant.
1984, audit manager, Price-waterhouse-Coopers LLP
1991, vice president of finance, Foxwoods Management Co.
1996, executive vice president and chief financial officer, Mohegan Sun
2004, executive vice president and chief operating officer, Mohegan Sun
2006, adds duties of chief operating officer, Mohegan Tribal Gaming Authority
2011, president and chief executive officer, Mohegan Sun; cedes responsibilities as COO of MTGA.
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