It is Time to Adapt to the 21st Century for Wynn and Okada

It is Time to Adapt to the 21st Century for Wynn and Okada

  • Ken Adams
January 25, 2019 1:47 AM

Steve Wynn and Kazuo Okada are two of the most successful men in gaming. Their careers span almost fifty years; each of them in his own way shaped the industry.  Wynn and Okada are the same age, born in 1942.  In the early 2000s, Wynn and Okada became partners when Okada invested $380 million in the newly formed Wynn Resorts; they shared the title of co-founder.  They appeared to be the best of friends; however, neither the friendship nor partnership survived the challenges of two alpha males battling for dominance.  Together they built casinos in Las Vegas and Macau.  But in 2008, Wynn was unwilling to join Okada in the Philippines.  The resorts in Las Vegas and Macau were designed and operated under Wynn’s direction.  The casino in Manila would have been under Okada’s sole direction as Wynn wanted no part of it.  In 2012, Okada was forced out of Wynn Resorts ending the friendship as well as the business partnership.

Ironically, Wynn and Okada were forced out of their respective companies within a year of each other.  In January 2018, Wynn was forced out of Wynn Resorts when he was caught squarely in the cross hairs of the “me too” movement.  The speed of Wynn’s demise was stunning.  For decades, Wynn’s name had been synonymous with creativity and imagination in gaming.  Few could imagine the casino industry without Steve Wynn.  Yet, within weeks of a Wall Street Journal article detailing Steve’s behavior he had resigned from Wynn Resorts, sold his stock in the company and exited the industry.  And for the moment at least, casino gaming is Wynn-less.

In 2017, Kazuo Okada was ousted from Universal Entertainment, the slot machine company he founded in the 1970s, after he was accused of financial mismanagement.  It was not the first time he had been accused of misusing the company’s money.  In pushing Okada out of Wynn Resorts, Steve Wynn had accused Okada of bribing officials and thereby endangering the company’s casino licenses.  In its action against Okada, the Universal board of directors, including Okada’s family declared he was spending the company’s money in ways that indicated bad management and posed a risk to the company’s casino license in the Philippines.  In the latest news on the subject, the government of Philippines has issued a warrant for his arrest.  Okada is fighting back; he is fighting Wynn, his family, Universal and the government of the Philippines. .  The outcome of the battles and lawsuits is far from certain, but in the meantime, the gaming industry in Asia is without its Kazuo.

Wynn and Okada have other things in common besides their age and gaming careers.  They are billionaires, collect very expensive art and enjoy lives of luxury.  However, the most significant thing they have in common at the moment is their Achilles heel, an outdated value system.  Before I become politically incorrect, I must confess that I too was born in the fateful year of 1942 and have that same affliction.  The Achilles’ heel stems from our birth 76 years ago. Much has changed in those years. In fact, most of the business practices learned by that generation have changed.  Some of the practices have simply been replaced by newer methods, but others have become unacceptable and even illegal.  When Steve was working his way up through the casino world women generally held inferior jobs and received inferior treatment.  A male executive could do as he pleased without fear of suffering any consequences.  Steve was caught being Steve; he is not the first or last older man who learned too late that standards of sexual conduct have changed.  Okada was caught in a comparable trap.  In the era when he learned his trade, bribing officials and spending company money on expenses that would not be considered proper today was common practice.  Like Wynn, Okada did not change his way of doing business, the way of doing business changed.

Both of these men may find a way back into gaming.  Sitting on the sidelines and cheering for someone else is not in their DNA.  For their entire career, they were the most important person in the room.  In fact, there is a rumor on the Strip this week that Wynn is shopping for property and Okada is certainly trying to regain control of the casino in Manila and Universal Entertainment.   But time is running out, neither is young and both are on the radar of every gaming regulator in the world.  Still, they are not too old. Wynn and Okada are still visionary thinkers. Even at 76, they still have ideas and skills that outshine their much younger competitors.  However, to make a comeback they need to adapt to the business practices that are acceptable today.  The need to adapt to 21st century practices and values is a problem common to all industries where senior leadership is composed of older men.  Speaking as one of Steve and Kazuo’s generation, it is not an easy lesson to absorb.  But if either Steve Wynn or Kazuo Okada is to succeed in the gaming business in the future, they will have to find a way to adapt to the new mores.