November cover feature: Quality control
The egaming industry has benefitted from heightened interest from graduates and experienced staff during the recession as it proves more resilient and better at managing risk than other sectors. Joanne Christie looks at how the past couple of years have affected egaming's ability to recruit the best and brightest.
RECESSION AND UNEMPLOYMENT are inextricably linked. One leads to the other and while this is certainly a bad thing for the many millions out of work or recently been made redundant, it is not necessarily bad news for everyone. For sectors such as egaming, which has held up well in the current market, job cuts in other industries can provide opportunities to attract good candidates and widen its talent pool.
Looking back, the online gaming sector was always looking at other sectors, the financial industry in particular, with covetous eyes. This was because many operators had listed and were looking to acquire contacts, know-how and respectability in the eyes of investors and the media. But all this was cut short by the 2006 Unlawful Internet Gambling Enforcement Act and the recession of the past two years.
Where top candidates were once able to command staggering salaries from gaming and non-gaming companies alike, the credit crunch has brought it all to a shuddering halt. The recession has also served to highlight and actually shatter two of the most common prejudices people would have had about the gaming and financial industries: that the former was run by dubious characters who cared little for best practice, while the latter was run by the cream of the crop who were highly knowledgeable about what they were doing.
So what is the situation for egaming companies looking to recruit top executives across all levels of their companies? According to Jonathan Flint, director at Flint Hyde Executive Search, gaming firms are gaining the upper hand when it comes to cherry-picking new recruits. “At the moment when we are trying to headhunt people, it is very much a buyer’s market because there is a lot of uncertainty in various sectors at the moment.”
James Fleming, director at Bettingjobs, has similar views. “The shift of power is going back towards the client, whereas it was very much a candidate-driven market previously. I think now you will find that the client can be a little bit more selective about who they want to hire.”
This is also good for the bottom line, Fleming adds. “Salaries are starting to steady off a bit now. They have been rising massively over the past couple of years because there was such a skills shortage. Now they are starting to plateau and that is good for the industry.” It has also become easier to keep people in their jobs, says Alex Lafferty, director at Hyperion Recruitment. “Turnover has decreased, so you have clients who used to have maybe a 40% turnover in customer service staff in Malta who are now looking at just a 10% staff turnover because people want to be secure. If they have a job, they want to keep it.”
But Dennis Van Maanen, managing director at Esanda Recruitment, warns that there is a misplaced belief among some gaming firms that there are also lots of available people with industry experience. “There were a few redundancies and we’ve lost a few companies but there wasn’t exactly a massive exodus. A lot of the redundancies were due to moving customer services teams to a different country, but there wasn’t a lot of mid to senior management lay-offs. So there isn’t a huge availability of talent with industry experience.”
While there might not be a huge amount of talent with gaming experience, there are plenty of people from other sectors looking for openings. The question is “ do gaming firms want them and how is this talent diversification handled by the industry?
Flint says: “When many egaming companies started eight or nine years ago, there was a merry-go-round of people going from one to another and the only thing that happened was their salaries went up but the skill base didn’t really increase.
“Most of the big players are now actively looking outside of the sector “ it broadens the talent pool and brings in fresh ideas. What you will probably find is that most of the tier two and tier three brands tend to mop up talent from their competitors, whereas the major players tend to search outside of the sector. The tier two and tier three companies don’t have the brand or the pull to take the top talent from other ecommerce businesses outside egaming.”
Most agree that it is those with ecommerce backgrounds who are most attractive to egaming firms. Flint says Blue Square’s appointment of Mark Jones, formerly managing director at lastminute.com, to the post of managing director last year, is just one example of egaming firms recognising the transferable skills such individuals can bring to their firms.
But Van Maanen cautions that while fresh blood can be a good thing, firms need to ensure they have the right mix of people. “About three or four years ago there was all this hype about the industry becoming more professional and trying to attract non-industry talent, but I think what we found was that there were a number of companies that were recruiting too many non-industry people and there was a knowledge gap and there wasn’t the right balance as a result.”
“If you’ve got a good bunch of people within a company who have been successful, then it is a good idea to get somebody from a different industry with fresh talent who can say; ‘I don’t know anything about casino, I’ve sold chocolate bars online and what we used to do is this, this, and this’. And occasionally everybody will look at each other and think ‘actually I don’t know why we haven’t tried that, that’s a pretty good idea’.”
With the constant legislative changes and expansion across Europe, many firms are also in need of language specialists, and particularly within customer service areas, selling and language skills are easily transferable, says Wayne Tritton, senior consultant at Euro London Appointments, a recruitment firm that specialises in multilingual placements. “The French legislation is changing next year and we are seeing a lot of demand for French customer service staff, from both clients who are already established in the market and those looking to open up there,” he explains. “We are also seeing an increase in demand for Eastern European speakers and Russian speakers, because in the Russian market they have made a lot of the gambling in casinos illegal so there is a lot more activity online.”
If it is those with financial experience egaming firms are interested in, they shouldn’t have to hunt too hard. According to the UK’s Office for National Statistics, 34,000 people lost their jobs in financial services last year and in the first two quarters of this year, a further 25,000 jobs have disappeared. Although bankers have recently hit the headlines with stories of bulging bonuses, the Confederation of British Industry (CBI) estimates that job losses in finance could be as high as 60,000 this year.
Bruce Gamble, managing director at Pentasia, says financial experience can be valuable to clients. “Some clients specifically target financial services companies as they like to have candidates familiar with tightly regulated industries or who are experienced with high-volume business-critical online-transactional environments.”
Fleming says there are also important similarities in the IT systems between the sectors. “A lot of the investment houses have used similar trading software programmes as some of the sportsbook companies, so there has been quite a nice migration of people coming from investment houses or banking.”
Fraud is another transferable area, says Lafferty. “We have recently placed people with financial backgrounds, especially from a fraud background. A major poker client of ours does specifically look for a background in fraud analysis and that can definitely be transferable from other industries.”
The collapse of the financial markets has not only led to job losses, it has also led to a loss of faith in the industry, starting from the bottom up with new graduates.
Charlie Ball, deputy research director at Graduate Prospects, says banking no longer holds the appeal it once did for graduates. “Graduates are starting to turn their backs a little bit on some of the financial organisations.”
In this year’s trendence Graduate Barometer, an annual survey of students’ most desired first employer after university, financial institutions suffered big falls in the table of the top 50 employers in the UK, with HSBC dropping from 12th to 21st place, and Goldman Sachs from 9th to 23rd place.
“We have observed a loss of trust in banks as employers in the UK, especially investment banks, due to the economic crisis. We expect this development to have an impact on the idea of a career in banking,” says Gesa Bartels, marketing expert at trendence.
Flint says the crisis in sectors such as banking has made the strength of egaming more obvious to newcomers.
“It has been much more secure than the banking sector over the past couple of years. On the whole, operators have posted pretty decent results in the past six to 12 months. Okay, a lot of them haven’t posted the stellar growth they had in the previous two or three years, but nevertheless they are still holding up,” he says. “It is positive when news is mostly doom and gloom at the moment. So naturally, candidates like investigating these businesses and quite often gravitate towards them.”
Gamble says people have also started to realise that the relative youth of the industry offers some good opportunities for career progression. “With many egaming companies still experiencing growth there is more opportunity for career advancement. Many candidates stipulate that they want to be part of a high-growth, ambitious, and dynamic company, which they may not get from a more traditional sector such as insurance or banking.”
But the way the industry is (mis-)perceived is still its biggest challenge, according to Van Maanen. “The biggest problem of attracting people to the industry is a misunderstanding of it, of people not knowing that it is actually a legitimate, organised, structured industry. The conversations I have with people in order to get them to understand that it is a typical dot com industry like any other, travel or pharmaceuticals; still bewilders me. Recently I was talking to a head of online marketing at a bank â we had a lengthy conversation but he still felt that his job would be more stable working for a bank than for an online betting and gaming company. Banking is an institution, it has been around for hundreds of years, online betting and gaming has been around for 15 years.”
Fleming says the industry is much more attractive to outside candidates than it was a few years ago. “We used to struggle sometimes to get people into gaming. Sometimes they might not have agreed with it for whatever reason. Now it is an easier sell for us as it has proved itself to be one of the more secure industries.”
Nobody would say egaming was recession-proof. If the recession has proved anything, it is that nothing is. But its resilience and the quality of the people running the companies in it compared to other sectors is likely to have a lasting impact on the perception of the industry; and this is definitely good news when it comes to attracting the best people.
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Kathy Swindley, group human resources director, PartyGaming
“We’ve seen a big increase in applicants from outside the gaming industry, predominantly from financial services as you might expect. People are looking more widely because jobs are more scarce. Some people will now consider an industry that they might not have considered previously. Also, there is far more awareness of the industry now, there is more advertising on the TV and the sector has far more status than it did before. Within the sector there has also been an increase in interest from those who have been in consultancy roles. Consultants are looking for more security and going for permanent employment as organisations tend to cut back on their consultancy fees before cutting permanent staff. We also have noticed a real tightening on non-compete clauses at senior level. Organisations are being more protective of their key talent.”
Malki Tiwana, head of international recruitment, Betfair
“Recently I went to hire somebody as a country manager for Denmark and I was massively impressed with the quality of our applications. It was outstanding, not only because these people had gaming experience, but also a number of applications ticked all of the boxes in terms of their knowledge, understanding of gaming legislation across Europe and good industry awareness in their own country. We are seeing a high level of interest at the moment, which I imagine is due to the fact that people see it as a growth sector. Betfair’s international operations now account for 49% of our business and therefore we are actively recruiting in numerous countries around Europe as well as in our international office based in Malta, which currently has over 160 employees. My aim is to try and keep the costs down for Betfair wherever possible by recruiting direct. I use the social media networks, online advertising space and traditional networking.” only if I’m struggling will I use an agency.“
Gill Baker, head of human resources, Microgaming
“Welcoming applicants from outside the gaming industry does, without doubt, represent a significant part of our recruitment strategy. Our aim is to strengthen the depth and breadth of Microgaming’s technical, creative and management capability. It is essential to get the right blend of skills and capability, with the appropriate mix of industry knowledge and gaming ‘passionistas’. Good relationship management, as well as analytical and project management skills, are essential for any Microgaming employee, as they are key to driving our business. There is no doubt that many of the candidates approaching us from industries outside the gaming sector have these transferable skills and qualities. Candidates who successfully make the transition from other industries are those that show an ability to learn fast; are flexible in their approach; and demonstrate the capacity to relate their business acumen to this dynamic and creative industry.”