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State Lotteries as Your Business Partner: Revamping the Business

Process

Wednesday, November 16, 200511:00 AM – 12:15 PM

The opinions of the contributors expressed herein do not necessarily state or reflect those of the National Association of Convenience Stores. Reference herein to any specific commercial products, process, or service by trade name, trademark manufacturer, or otherwise, shall not constitute or imply an endorsement, recommendation, or support by the National Association of Convenience Stores. The National Association of Convenience Stores makes no warranty, express or implied, nor does it assume any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, product, or process described in these materials.

State Lotteries as Your Business Partner: Revamping the Business Process

• Moderator: John Hervey, Executive Director & CEO, PCATS

• Speaker #1: Clint Harris, Executive Director, Minnesota State Lottery

• Speaker #2 : Andrew White, NSI Project Manager, NASPL

• Speaker #3: Richard Wilkinson, Lottery Sales Representative, Kentucky Lottery Corporation

• Speaker #4: Art Whetstone, Chief Financial Officer, Calfee Companies, Favorite Markets, Inc.

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State Lotteries as Your Business Partner: Revamping the Business Process

Clint HarrisExecutive Director Minnesota State Lottery

1st Vice President & NASPL Standards Initiative ChairThe North American Association of State & Provincial Lotteries

History of Lotteries

• Book of Numbers, Chapter 26

• Founding Fathers and Lotteries

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The “Mountain Road” Lottery of 1768

Boston’s Faneuil Hall Lottery of 1767

Continental Congress Lottery - 1776

Harvard College Lottery - 1811

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History of Lotteries

• Prohibition of Lotteries

• 1964 and the Modern Lottery

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NASPL History

The North American Association of State & Provincial Lotteries (NASPL) was founded in 1971.

The Association evolved from an informal exchange of information among three pioneering lottery directors.

The organization has now grown into an active association of state and provincial lotteries representing 50 lottery organizations.

NASPL Objectives• Provide a central source of information.

• Facilitate communication among lottery organizations.

• Offer educational opportunities to the lottery industry.

• Initiate a vehicle for professional and industry research and development.

• Establish a public, united voice on common causes and issues.

• Maintain the development and implementation of standards within the lottery industry.

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• In 1970, there were only 4 U.S. and Canadian lottery organizations in existence.

The Lottery Industry

• Today, there are 50, with two more on the way

The Lottery Industry

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Background: NSINASPL establishes Industry Standards Task Force to investigate and make recommendations for way forward – Aug., 2001

Chair of NASPL Task Force Appointed – Sept., 2001

NASPL contracts with The Open Group for Business Scenario and Recommendations – Oct., 2001

The Open Group conducts Business Scenario Workshop with NASPL Task Force at IT Sub-Committee meeting in Minneapolis, MN – Nov., 2001

The Open Group supplies final Scenario and Recommendation Document – March, 2002

Background: NSI Continued• NASPL Industry Standards Task Force approves the

Recommendations - Apr., 2002

• NASPL and The Open Group conduct several regional lottery meetings to obtain buy-in for financial and resource support from Lottery Directors - May through Aug., 2002

• NASPL and The Open Group conduct personal Vendor meetings to gain support and funding commitment – May through Aug., 2002

• NASPL Approves Recommendations and Funding for initial 2-yr. Project – Sept., 2002

• NASPL Standards Initiative Project Begins – Oct., 2002

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State Lotteries as Your Business Partner: Revamping the Business Process

Andrew WhiteNSI Project Manager

The North American Association of State & Provincial Lotteries

What is NSI?

TheNASPL

StandardsInitiative

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NSI APPROVAL TIMETABLE

Quality Assurance of Product DevelopmentApproved: April 2004

Instant Ticket Barcode Technical StandardApproved: September 2004

Standard for XML Retailer AccountingApproved: June 2005

Web Based Retailer ApplicationsScheduled To Be Approved: February 2006

Global Best Practice for RFP ProcessJoint NSI/WLA Scheduled to be Approved: June 2006

NSI CERTIFICATION TIMETABLE

Quality Assurance Best PracticeLaunched: January 2005

Currently Available

Bar Code Technical StandardScheduled To be Launched: December 2005

Retailer Accounting (XML) StandardTo Be Launched: January 2006

Web-Based Retail ApplicationsScheduled To Be Launched: September 2006

Global RFP Best PracticeScheduled To Be Launched: January 2007

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XML Retail Accounting Reporting• Based on PCATS Standard• NSI provides common definition for lottery retail-reporting data in XML format•Enables common reporting format

Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06IR FR FA

DC IC LC

IR: Informal Review of Standard/Best PracticeFR: Formal Review of Standard/Best PracticeFA: Final Approval of Standard/Best PracticeDC: Define Certification ProgramIC: Implement Certification ProgramLC: Launch Certification Program

Q1= Jan - Mar Q2 = Apr - MayQ3 = July - Sept Q4 = Oct - Dec

Lottery/Retailer Web Based Applications •Best Practice Component•Technical Standard Component

Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Q3-06DV DV IR FA

FR DC IC LC

DV: Develop and Document Best Practice IR : Informal Review of Standard/Best PracticeFR: Formal Review of Standard/Best PracticeFA: Final Approval of Standard/Best PracticeDC: Define Certification ProgramIC: Implement Certification ProgramLC: Launch Certification Program

Q1= Jan - Mar Q2 = Apr - MayQ3 = July - Sept Q4 = Oct - Dec

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ConceptThis effort will:

Identify business areas between a Lottery and RetailerUtilize web based technologiesUltimately provide better service, communication, and

will build better business relationships.

Specific Areas of the Web-Based Applications

Financial Data

Inventory Data

ReportingRetailer Life Cycle ManagementSurveysNews, General InformationSecurity (Retailer Focused)

Lottery/Retailer Web Based Applications

Web-Based Applications: Benefits to Retailers

Retailers can utilize a more robust technology without having toutilize the sales terminal.

Remote managers or financial controllers can directly access thebusiness functions without requiring remote stores to forward terminal reports.

Larger Retailers benefit by having consistent communications with Lotteries across jurisdictions.

Smaller Retailers will have more information available to help them effectively control their inventories and meet the financial requirements of the Lottery.

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Web-Based Applications: Benefits to Lotteries

Lotteries can provide state-of-the-art web based communications to their Retailers.

Web-Based Sales information and accounting allows Sales terminals to stay focused on sales while this technology handles the back office relationship between Lotteries and Retailers

Lotteries can evaluate Vendor offerings with a clear benchmark of best practices and standards

Lotteries can provide information in a wider variety of formats than the standard ticket stock reports available through the terminal.

2, 4, 6, 8...

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How Do You Participate?Best Practice Working Group:

Retail Web Based Applications • Process focus: Lottery-Retail Operations, Sales and

Marketing, Reporting etc.

TSWG

Retail Web Based Applications• Technical focus: Lottery-Retail Operations (web-site

development and information exchange)

Retail CouncilRetailers • Serves as Advisors to NSI

What Are You Volunteering For?

Choose the one that best meets the current priorities of your organization and where your staff could most benefit from or add to a learning experience.

Web Based Lottery/Retailer ApplicationsTechnical Standard and Best Practice Development

Technical Standard Telecon Calls Wednesdays at 11:30 AM EDT.

Best Practice Telecon Calls Thursdays at 3:00 PM EDT.

NSI Retail Council

Telecon Calls Every 3rd Thursday of the Month at 2:00 PM EDT.

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State Lotteries as Your Business Partner:

NAXML Will Enhance The Security of Selling Lottery Products

Rich Wilkinson Kentucky Lottery Corporation

Wednesday November 16, 2005 11:00 a.m. – 12:15 p.m.

TECHNICAL ASPECTS OF XML

• Foundation of XML and NAXML• XML is based on Standard Generalized Markup

Language (SGML• XML will act as a Bridge between SQL and Web

Applications• The NAXML Schema

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NAXML WILL SPEED UPTHE FLOW OF INFORMATION

STANDARDIZEDINFORMATION

SENT TOCHAIN HEAD

AUTOMATEDTRANSACTION VERIFICATION

PROCESS

AUTOMATEDTRANSACTION

VARIANCEAUDIT

LOTTERYTICKETS ORDERED

NAXML STANDARDSA NEW PARADIGM FOR

TRANSACTION INFORMATION EXCHANGE

• THE NAXML STANDARD WILL IMPROVE MANAGEMENT CONTROLS

• HELP REDUCE LABOR COST• HELP REDUCE LOSSES• ULTIMATELY IMPROVE PROFITABILITY

OF SELLING LOTTERY

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Automating ReconciliationsUsing PCATS Standards

Art WhetstoneChief Financial Officer

Calfee Companies, Favorite Markets, Inc.

Wednesday, November 16, 200511 AM – 12:15 PM

Standards in Use at Favorite Markets

• Lottery Invoice • Credit Cards PreDraft• Bill Reader Safe Interface

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Standards in Use at Favorite Markets

• Lottery Invoice • Credit Cards PreDraft• Bill Reader Safe Interface

Lottery Invoice

• aka the Chain Summary Statement

• only XML file available from Georgia

•Weekly program

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Benefit #1 -Timeliness and Accuracy

• File is ready when you are• No procrastination• Eliminate manual extraction

Benefit #2 - Expansion of Processes

• Automate postings to ledger• Activation and Confirmation

function added• New state with 58 stores

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Benefit #3 - Clerical Workload

• Large reduction of clerical time• Released all clerical employees• Freed up for other tasks

The Business Process

• External Source (XML file)• Downloaded file• No changes necessary

• Database• Access, SQL, etc.

• Internal Data Source• Your accounting System

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Stylesheet

• Extracts needed data• Coded in notepad or word

processor

Stylesheet Example<?xml version="1.0"?><!-- File Name: Lottery.xsl --><xsl:stylesheet

version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform">

<xsl:output method="html" /><xsl:template match="/">

<table><th>Store#</th><th>Pack#</th><th>Game#</th><th>DateSettled</th><th>AllowAmt</th><th>Type</th><th>GameDescription</th><th>Line#</th>

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Stylesheet Example (cont’d)<xsl:for-each select="//AllowanceOrCharge/AllowanceOrChargeReason[@identType='Promotions']">

<tr><td><xsl:value-of select="ancestor::Invoice/Location/OrganizationId" /></td><td><xsl:text> </xsl:text></td><td><xsl:text> </xsl:text></td><td><xsl:text> </xsl:text></td><td><xsl:value-of select="parent::AllowanceOrCharge/AllowanceAmt" /></td><td><xsl:value-of select="@identType" /></td><td><xsl:value-of select="ancestor::InvoiceUnit/GameDescription" /></td><td><xsl:value-of select="ancestor::LineItem/@count" /></td>

</tr></xsl:for-each></table>

</xsl:template></xsl:stylesheet>

Html File Example

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Inside the Database

• The code for the extraction• Linking output file and other tables• Querying the results• Files you need from

– PCATS• NAXML-datadictionary.dtd• NAXML-LotDoc.dtd

– Other• msxsl.exe

Database tables

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Database queries

Database Macros

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Database Modules

Final Thoughts

• One Size Fits All– One standard, many states

• Extra Cooks in the Kitchen– Simplified process, fewer people

• The Paper Chase– Who needs it

• Focus on exceptions• Access shines

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So Let’s Review(The Before Picture)Now Look!

Thanks To!

Thank You!

• Email [email protected]• Ph 706-226-4834 x 260

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901 King Street, Suite 300

Alexandria, VA 22314

Phone: 703-836-0919

www.PCATS.org

For more information, please contact PCATS!