EL Magazine #58 : INTRALOT: From waterfall product development to customer-centric, agile evolution: The role of the new Digital Service Platform

By Nikos Nikolakopoulos, Group Chief Commercial Officer

In nature, all organizations respond to changing environmental conditions by evolving themselves. It is a continuous struggle: change and adopt or perish. The same happens in the business world. The macro-environment (customers, trends, habits, technology, regulations and competitors) changes all the time and the companies must find innovative ways to change and evolve or pay the price.  Lottery Business is deep inside this evolutionary path. For an industry grown as a traditionally retail-focused business, the emergence of digital markets and the necessary business operation transformation is quite challenging compared to other digital native businesses.

A digital transformation of this kind is much broader than simply launching an online portal or an application. It affects every aspect of the Lottery operation: product design, ways of working, systems architecture and workforce skillsets.

Customer-Centric Product Design

Product design should focus primarily on Customer Experience. In fact, as Steve Jobs pinpointed since 1997, “You have to start with the customer experience and work backwards to the technology”.  Lottery products (digital or retail) should be customer-centric, playful, and versatile and capitalize on the Lottery’s wealth of player behavior data.

Agile way of working

Designing the right product is one thing, however offering this product to the customers at the right time is another, even more challenging, aspect. Traditional, waterfall, ways of product and IT development struggle to meet the always changing and fast pacing digital environment of today. The need to transform the business and IT operation to an agile form of working is more than evident. The results from a successful agile transformation are stunning even for very traditional and slow-moving businesses such as automotive. A 100% agile transformation at BMW IT resulted to an 81% time-to-market improvement for change requests, 72% decrease of customer complaints in three months and improvement of customer satisfaction from insufficient to good within 6 months.

Lean and modular architecture

The need for customer-centric product design and agility in development brings forward probably the most complex challenge for the evolved Lottery: transformation of IT systems and architecture. Traditionally the Lottery systems were powerful, centralized and monolithic IT structures with proprietary technologies and interfaces, at the heart of the walled-garden ecosystem of the lottery operation. This model served adequately the legacy business but it is not sustainable in the fast changing digital environment that requires openness, agility, standardization, efficiency and fast deployment. The omnipotent lottery central system will have to be redefined as a Digital Service Platform. The architecture of such Service Platform will be based on standardized modular components that are secure, easily deployed and scalable and open APIs with centralized critical functionalities like identity management and authentication, real-time analytics, game configuration and distribution, as well as monitoring and operation. This evolved systems architecture offers quick and lean deployments, increased scalability, easy integration with third party platforms and systems, real-time financial monitoring and reporting as well as security and reliability at all levels. Most importantly however, such an architecture is optimally positioned in order to successfully face the challenges of the new digital economy.

Workforce of the Future

In pursue of its evolutionary path the Lottery Business transformation, requires apart from systems, architecture, design and development methodologies, also the workforce, processes and culture to be evolved. In fact if the latter doesn’t happen, then the whole transformation process will be at risk. The new operating models require increased collaboration between teams, new roles and new skills from a workforce that will lead the business to the future. Year-long practices and working “silos” will most definitely need to be re-thought. Companies that lead successful transformations have not hesitated even to refurbish their offices in order to cultivate and promote openness, collaboration and cultural change.

There is no doubt that the gaming environment will keep evolving, even with higher pace than today, following the evolution of the customer behavior and trends. Lotteries need to step up their digital transformation efforts, if they want to be ahead of the game. Success will be determined by their ability and commitment to lead this (r)evolutionary change.