Interview with Andy Duggan
Interview conducted in 1995.
Andy Duggan is Director of Finance and Administration at Harrah's Riverboat Casino in Joliet, Illinois. He obtained a Bachelors of Science degree from Stockton State College just outside of Atlantic City, New Jersey. He is a Certified Public Accountant and has worked in the casino industry for 12 years…
Andy's experience and position at Harrah's provides and "insider's" perspective on the role statistics plays in all faces of this industry.
Could you tell us something about yourself- what is your background in statistics? What courses did you take in college?
As an undergraduate, while studying for a bachelors of science degree in accounting I was exposed to several statistic courses primarily in the economics area, specifically micro and macro economics. I do remember however, a most interesting statistical course I took entitled "Use and Abuse of Statistics." While the name was rather interesting I do recall the course was quite challenging.
How long have you worked in the gambling industry?
I began my career in the casino industry immediately upon college graduation in 1982. I was raised in New Jersey and attended college just miles outside of Atlantic City. During my early college days casino gaming was just introduced in New Jersey. I will never forget my first visit to an Atlantic City casino. I was amazed by the lights, the sound and the excitement. It made quite an impression on me. For some reason I knew the industry was going to take-off. I also knew the industry was going to need accountants. I was never quite sure why I wanted to be an accountant, but I figured if I was going to be one where better than the casino industry where the action is non-stop.
Do casinos really use statistics? In what ways?
Absolutely! It is difficult to think of an area within the casino where statistics are not applied. First and foremost statistical applications are most relevant when it comes to games of chance. As you are aware each of the games offered in a casino have varying house advantages whether it be blackjack, craps, or slot machines. Knowledge of the varying house advantages help make determinations of what rules of the games will be offered by a casino. For instance take blackjack, while the basic game is generally the same in any casino the rules oftentimes vary because of the competition in the marketplace. First how many decks are used in the game, the more decks used the more difficult it is for a card counter to keep track of the cards, or "count" as it is known. In a highly competitive market like Las Vegas many houses will play blackjack with a single deck, quite to the delight of card counters. In this example, a seasoned card counter will actually have a slight advantage over the casino. I could go on and on but the above example demonstrates the mathematics and statistics included in the game of blackjack. Other items that are used every day in the casino are player ratings. Whenever a customer plays a table game or slot machine he or she is rated. Ratings take into consideration buy-in (chips purchased), average bet, length of time play, decisions per hour (hands at card games or rolls of dice) and observed player skill (novice, expert.) All these items are then used to calculate the overall win based on the house advantage of the casino game. Such information is used in many ways by the casino from player party invitations to complimentary services.
"It is difficult to think of an area within the casino where statistics are not applied."
Other uses of statistics include player demographics. To be successful in the casino industry you need to know who your customers are. How old is your customer base? Where do they live? What are their favorite games? When do they like to visit your casino? These are all questions that must be asked. Through extensive surveys and focus group interviews we are able to keep in touch with our core casino customer base and if we do our job right keep them a happy customer for a long time.
Are some games more profitable than others?
If so, what role does statistics play in determining this?
Yes, each game's profitability is based on the house advantage and the popularity of the game. The biggest casino table game is of course blackjack or twenty-one. Blackjack is usually the most profitable of all table games because the number of tables offered in a typical casino usually exceed any other. Regarding statistics blackjack profitability is always effected by the level of skill of the players. Blackjack is the only game in a casino where a player can actually gain an advantage over the house by card counting. However, while many people proclaim to be card counters only a few ever master the technique. Even though blackjack is the most popular game in a casino, baccarat, another card game, actually offer the player better odds.
Are Roulette wheels checked for balance using a statistical test? If so, what test? A randomization/Runs test?
Each day each roulette wheel is calibrated using some very sophisticated equipment. In fact such calibration procedures are usually mandated by the regulatory agencies of each state. I always watch people keep track of the results of each roulette spin. Most casinos even give the players score cards. Many believe that the roulette wheel is not truly random due to an imbalance and seek to take advantage of that. They will watch for the house and then make their wagers. Many people will focus on quadrants or zones of the roulette wheel.
In your experience, does the "doubling when you lose" on black-and-red Roulette work? Have you seen anyone leave the table rich using this system?
Doubling when you lose is a system which is deadly to the player. First the casino has table wager maximums on each game. The difference between the minimum table wager and maximum table wager is called the "spread." Usually a spread will allow the player to double his or her bet seven times. For someone trying to make $100 you see that after three losing rolls, the player must wager $800 ($100 + $200 + 400) just to win $100. This is not good play.
Are slot machines checked for randomness? How?
The randomness and integrity of each slot machine is insured by a computer chip known as an EPROM (erasable, programmable, read on memory). Each EPROM is tested by state regulatory laboratories before approval and use. Once the EPROM is placed into a slot machine it is sealed by the state gaming board. Any access to an EPROM must be done in conjunction with the state gaming board.
Thorpe and others have shown that card-counting can help one reduce the odds against them and win at Blackjack. What is your response to that?
As I mentioned earlier, card-counting techniques if carried out successfully can reduce the odds against the house. In fact, blackjack is the only casino game in which the player can turn the odds in his or her favor. Many publications are written which deal with many methods of tracking cards in the game of blackjack.
Is it true that when a player consistently wins "big" that casino management usually finds a way to bar them? Is statistics ever used in making such a determination? That is, do casino personnel make some determination that the winnings are above and beyond pure chance?
It is true that blackjack players have been barred from casinos but in the total scheme of things this is a rare event. Most casinos try to combat the professional blackjack players by increasing the number of decks used (up to eight) and shuffling frequently.
The most obvious way to determine if a player is counting cards is to observe the wagering patterns. For example, a player counting cards may bet the table minimum when the cards are in the casinos favor. At some point in time when the player feels the deck is "rich" or in his favor he will increase his wagers.
European casinos encourage "systems" use for winning. In fact, many of them provide the customer with a sheet to mark numbers that have appeared, so that counting and other strategies may work.
Why are American casinos opposed to similar practices?
I don't believe that American casinos are opposed to the use of any systems. As I stated earlier many casinos give their customers scorecards in Roulette and Baccarat to track results. This is something the casinos do to provide customer service which is really what running a successful casino is all about. In fact, many casinos offer their customers basic strategy cards in blackjack which offer advice to the player on when to hit, stand, split, double, etc.
Is there such a thing as a consistent winner? If so, is there a common characteristic that consistent winners have?
Consistent winners- sure! I believe there are two common characteristics of the consistent winner. First, expert money management, set your win/loss tolerances and stick to them. Once your goal is achieved (for example to win $100), walk away. If the cards aren't playing in your favor stop playing and try another day. However, maybe the most important factor in becoming a consistent winner is good luck. Some people just seem to be lucky when it comes to games of chance. We all know someone who consistently hits the winning numbers in lottery or wins the charity drawing. Luck may be the biggest determining factor in becoming a consistent winner.
Would, or should, a player who has a background in statistics or math have an advantage (be more likely to beat the odds) at certain games as compared to a customer who doesn't? Why?
Absolutely, someone who is knowledgeable in math or statistics would probably know the house advantages in the various games offered in a casino. Coupled with that an informed individual should be able to understand that concept of money management. Some basic knowledge can go a long way in a casino but luck always helps!
