Course material

1. Implementing LEAN Operations at Caesars Casinos
Prompt
Your report should answer the following prompt: You will submit a report in which you
analyze the company in the Caesars Casinos case study using the plan-do-check-act (PDCA)
cycle. Your report will include an introduction where you provide an overview of the
company and identify a problem the company is facing. Then, you will interpret the data
provided to you and create a graphical representation of the data. As part of your
application of the PDCA cycle, you will identify a solution to the problem you identified,
develop a plan for testing the solution, analyze the results of the changes implemented to
test the solution, and, finally, evaluate the solution.
Requirements: 10-12 pages
TB0389Copyright © 2014 Thunderbird School of Global Management. All rights reserved.
This case was prepared by Professor Nancy Lea Hyer (Vanderbilt), Brad Hirsch, and
Professor Karen A. Brown (Thunderbird) for the purpose of classroom discussion only, and
not to indicate either effective or ineffective management. Nancy Lea HyerBrad HirschKaren
A. BrownImplementing LEAN Operations at Caesars CasinosIn December 2014, Brad Hirsch
stood on the gaming floor of the Harrah’s Metropolis Casino and Hotel in Metropolis,
Illinois. Hirsch had assumed the position of Senior Vice President and General Manager at
this Caesars Entertainment property in mid-2014. Caesars’ culture was strongly oriented
toward optimizing the customer experience. This history, coupled with increased
competitive pressures and new corporate financial goals for 2015, had created the
motivation to intensify improvement efforts at the Metropolis facility. Hirsch had
successfully led employee-centered initiatives to apply LEAN1 operating principles in three
of the company’s casinos in Tunica, Mississippi. He believed that what he learned from
those experiences would be applicable at the Metropolis location, but wondered if he should
consider a modified approach that could potentially produce results more quickly with the
help of a team of internal experts. In 2014, Caesars Entertainment, based in Las Vegas,
Nevada, was the world’s most geographically diversi-fied provider of casino entertainment.
With 68,000 employees worldwide, it operated 50 casinos in the U.S., Egypt, England, South
Africa, and Canada, under the names Harrah’s, Caesars, Rio, Flamingo, Paris, Bally’s,
Horseshoe, and London Clubs International. Its largest concentration of properties was in
Las Vegas, where nine of its casinos occupied 1.25 miles on or near Las Vegas Boulevard,
commonly known as The Strip. In 2013, the company had net revenue of $8.6 billion
U.S.Caesars had developed an industry-leading loyalty-card program, introduced

2. sophisticated customer-service measurement systems, and had been the first to apply LEAN
process-improvement concepts to casino opera-tions. (For more on LEAN principles, see
Appendix A.) As Hirsch thought about the challenges that lay ahead for LEAN
implementation aimed at customer-service enhancement and operational effectiveness at
the new Harrah’s Metropolis Casino and Hotel, he reflected on his previous experience in
Tunica.LEAN Implementation at Caesars in Tunica, MississippiAt the end of 2008, Tunica,
Mississippi, located about a 45-minute drive south of Memphis, Tennessee, was the fourth-
largest gaming market in the world with more than $1 billion in annual revenue. Three of
Tunica’s nine casinos were owned by Caesars. These three generated $545 million in
revenue and accounted for 50% of the Tunica market. Over 4,000 employees worked across
the three Caesars properties, delivering hospitality and entertainment services to 8,000,000
guests annually. In late 2008, the economic environment for the Caesars Tunica casinos was
a serious concern. First, the U.S. macroeconomic collapse of the Great Recession had led to
reduced customer spending on entertainment. As a consequence, casinos in the region
experienced declines in revenue, and competition for market share was intense. Beyond the
impetus for improvement inspired by macroeconomic challenges, all Caesars-owned
properties embraced customer service as an essential element of the corporate operating
strategy, and strove to continuously increase customer satisfaction as gauged by rating
scores. Every week, Caesars surveyed a random sample of recent customers for each
property. Survey respondents assigned scores of A, B, C, D, or F for various dimensions of
their Caesars experience (staff helpfulness, staff friendliness, speed of service, and other
metrics). Data showed that moving a customer from a B to an A score resulted in up to a
12% increase in customer 1 Caesars Entertainment capitalized the word “LEAN” to
emphasize its role as a systematic program and distance it from any connotations
associated with a more narrow view that might suggest downsizing.This document is
authorized for use only in Miguel Angel Heras©s 20/21 - Fund. Excelencia
Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to May 2021.
2 TB0389spending. On a quarterly basis, weekly service-score data were averaged and used
as a factor in determining staff bonuses. The higher the percentage shift of B scores to A
scores, when compared to the same quarter the prior year, the higher the bonus for team
members. At the end of 2008, the Caesars Tunica leadership team sought to deliver more
conversions from B to A scores, both to increase customer loyalty in a hypercompetitive
landscape, and to maximize team-member bonuses and enhance employee satisfaction.
Members of the Tunica executive team recognized that to reverse the declines in revenue
and challenges to profitability, and improve service scores and market share, would require
engaging the entire organization. However, one challenge was the absence of a consistent
and systematic problem-solving approach through all layers of the 24-hour, 7-day a week
business. As one associate observed, “If your supervisor is passionate about casino
cleanliness, casino cleanliness becomes your top priority. But your next supervisor, or the
supervisor of the next shift, might focus on a completely different aspect of the customer
experience.” Hirsch recognized that LEAN, with its easy-to-understand tools and concepts,
could create a consistent and focused approach to process improvement for all layers of the
business. Kaizen Events as the Organizing Framework for Implementing LEAN at Caesars

3. Tunica, Mississippi, CasinosIn December 2008, Hirsch was appointed Regional Director of
LEAN for the three Caesars casinos in Tunica. He and the executive team saw the urgency
for change, and knew they had to make the right improvements and sustain them. Hirsch
created a Regional LEAN Team by recruiting two experienced, high-potential leaders from
the casino operations in Tunica, each with a passion for process improvement. The team
agreed to orchestrate the LEAN rollout around a series of kaizen events. These were
intensive five-day workshops involving employees from multiple functions and levels
working together to identify and improve target processes.2 For example, an early kaizen
event focused on improving hotel operations—from check-in to check-out. The kaizen team
included a department manager, bellhop, housekeeper, front desk clerk, supervisor,
information-technology associate, and a gaming-floor employee. The department manager’s
participation ensured that she understood the work under-taken during the kaizen week
and would be prepared to lead the follow-up activities that grew out of the event. An initial
challenge was that, to some casino employees, the word lean implied cutting jobs. To
address this challenge, members of the executive team consistently communicated that the
goals of eliminating waste via LEAN efforts were to improve the customer experience,
increase process effectiveness, teach problem-solving tools, and improve employees’ work
environments—not to cut personnel. Sharing this message was important, but Hirsch and
his team knew they simply had to start conducting kaizen events so individuals would SEE
that jobs were not being eliminated. As Hirsch explained, “We thought our behavior would
speak louder than our words, and it did.” The five-day kaizen workshops—each of which
followed a similar structure (see below)—yielded immediate, tangible improvements and
laid the foundation for post-event efforts to establish a LEAN culture throughout the
organization. During calendar year 2009, Hirsch and his team staged 63 five-day kaizen
events. These events resulted in improved customer-service scores and $3 million in
documented savings. Each five-day workshop in-cluded a set of activities intended to build
knowledge, engage participants, solve problems, and develop solutions.• Kaizen Day 1Every
kaizen event began with education about LEAN concepts. A major component of this
education was teaching employees to recognize waste (or, in Japanese, muda). Hirsch and
his team used a memorable acro-nym for teaching waste recognition that seemed to
resonate through the entire organizational hierarchy—DOWNTIME (defects,
overproduction, waiting, not engaging people, transportation, inventory, motion, and extra
processing). At each kaizen event, the facilitator explained DOWNTIME using examples
from the casino environment. 2 C. Marchwinski and J. Shook (Editors), Lean Lexicon: A
Glossary for Lean Thinkers, Fourth Edition (Cambridge: The Lean Enterprise Institute, Inc.,
2008, p. 41.) This document is authorized for use only in Miguel Angel Heras©s 20/21 -
Fund. Excelencia Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan
2021 to May 2021.
TB0389 3– Defects: Defects are mistakes that result in items being scrapped or reworked.
Delivering a drink to a customer with ice when the customer has requested no ice is a
defect. Checking a guest into a hotel room with the incorrect bed type (i.e., two queen-size
beds instead of a king-size bed) is a defect. In both situations, wasteful rework is required
and the customer is left with a poor impression.– Overproduction: This is production in

4. excess of what the customer requires. Customers in one restaurant were sometimes served
water with three lemon slices. Most customers were satisfied with a single lemon slice. As
Hirsch explained, “Customers write us all the time to tell us what they love about our
casinos in Tunica, but occasionally getting additional lemons in their ice water is not a cause
for customer delight.” Producing three times as many lemon slices as necessary was waste
because it consumed money and time without creating additional value for the customer. –
Waiting: Waiting-time waste occurs when employees are idle or when customers must wait
for service. Time spent waiting adds no value to the product or service. If a gaming table
runs out of a particular dollar-value betting chip, the table-games supervisor signals for a
chip replenishment. Chip replenishment is a time-consuming process that, because of
regulatory standards and asset protection protocols, requires supervisor verification, travel
to and from the cashier cage where money and chips are held, and engaging a security
guard to oversee the transport. During portions of the process, patrons and employees
sometimes must wait to resume gaming activity, which affects profitability of gaming
operations. Similarly, if a hotel-room attendant cannot finish cleaning a room because
sheets or towels from the laundry aren’t delivered on time, the attendant may be forced to
wait. This yields non-value-creating payroll expense and a delay in room readiness for
customers.– Not Engaging People: Organizations incur waste when they don’t routinely ask
employees, “What would you change that would make your job easier to do and allow you
to better serve customers?” Prior to the introduction of LEAN methods, the majority of
tactical process changes occurred as a result of a top-down approach. Although some of
these top-down solutions produced improvement, they did not always achieve their highest
potential. Without immediate feedback from the employees actually doing the work,
managers could not fully appreciate delivery-system challenges. For example, employees in
one area struggled to transport food carts across deep-pile carpeting in corridors, resulting
in relatively long transport times and employee fatigue. During a kaizen event, the
employees who had experienced this performance obstacle greatly appreciated having their
voices heard.– Transportation: This is the waste of resources, time, and effort involved in
moving items and tracking their locations. Damage and non-value-added payroll expense
are always a risk when items are transported, and transportation adds to process
throughput time. Moving food, for example, does not add to its value. One kaizen team
tracked the life of a beer and discovered that a beer could be put into storage in up to five
different locations before being acquired by the beverage server for delivery to customers.
Limiting transportation frees employees for higher-value work, and, in the hospitality
industry, can also help protect product quality. – Inventory: Inventory waste is incurred
when material on hand exceeds current demand. Excess inventory costs money, takes up
space, can create a safety hazard, and becomes obsolete when customer requirements
change. Inventory is, in essence, dead money—money has been spent on something that is
doing nothing to create customer value. An examination of one of the Tunica warehouses
revealed multiple pallets of boxes of paper used to print vouchers for customers cashing out
from slot machines. Each month, a team ordered approximately $10,000 worth of slot
paper, regardless of current inventory levels. This order level had historically enabled the
property to have the right quantity of slot paper on site. However, as business levels

5. declined for casinos in the Tunica region and slot volumes became more variable, a six-
month supply of slot paper accumulated in the Caesars Tunica warehouse. – Motion: Any
movement that does not add value to the product or service represents waste of motion. In
a food-service area, bottles of water were stored in a large tub-like container of ice (rather
than a refrigerator) to keep them cold. Servers incurred waste of motion every time they
reached into the container, withdrew a cold bottle of water, grabbed napkins from a nearby
dispenser, and dried off the bottle before placing it on a tray to deliver it to a customer.This
document is authorized for use only in Miguel Angel Heras©s 20/21 - Fund. Excelencia
Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to May 2021.
4 TB0389– Extra Processing: Extra processing occurs when unnecessary, non-value-adding
work is performed. For years, as part of the property’s security protocol, a security guard
used a metal-detecting wand to scan bags of trash coming out of the casino’s cash-counting
room to ensure that coins were not being smuggled out. This practice continued after the
casino eliminated all metal coins from operations. No one questioned the protocol to wand
the trash because it was always done this way and was assumed to be a regulatory
necessity. D-O-W-N-T-I-M-E proved an effective analytical tool to help front-line personnel
see the various types of waste in work processes. In addition, Day 1 training also introduced
several LEAN tools. Participants learned about value stream mapping, spaghetti diagrams,
5S, Five Whys, one-piece flow processing, the pull discipline, and the basic problem-solving
approach (i.e., define the problem, seek out root causes, identify potential solu-tions, test
them, keep what works, repeat). With an understanding of these LEAN principles and tools,
the teams were ready to improve their own processes. At the end of Day 1, each team
agreed on the processes that would be the focus of the week’s kaizen improvement efforts.
The selected processes presented the greatest opportunities to improve customer service
and reduce waste.• Kaizen Day 2During the second morning, participants mapped the work
processes targeted for im-provement. Team members engaged in what was called a gemba3
walk, in which they went to where the work was done, made notes on what they
individually saw, and gathered data about each process step. Then they jointly created a
large, wall-display value stream map of the process using sticky notes and simple symbols
(see Exhibit 1 for an example). The afternoon of Day 2 was devoted to a waste walk. Armed
with a sheet that listed the types of waste and using the DOWNTIME rubric, each participant
observed a segment of the process and recorded every waste he or she identified. In some
cases, team members counted how often a particular waste (e.g., walking to retrieve a
forgotten item) occurred and timed the duration. This information helped teams to
understand the effects of the waste on the business. After completing their observations,
team members met to share their waste discoveries, recording each waste on a separate
sticky note. A typical kaizen team identified between 60 and 80 points of waste in the target
process. As part of the waste walk, a team member equipped with a copy of the area layout
would follow a specific person or product, drawing a line from start to finish every time the
person or product moved to a new loca-tion. The result, called a spaghetti diagram, often
provided compelling evidence of the motion and transpor-tation waste inherent in the
current way work was done. Exhibit 2 shows the spaghetti diagram of sandwich production
developed as part of a kaizen event focusing on kitchen operations. In the afternoon of Day

6. 2, team members categorized wastes by moving each pink sticky note into the appro-priate
quadrant on a wall-mounted matrix (see Exhibit 3). Specifically, the team determined
whether a waste would be easy or hard to remove and whether removing the waste would
have a large or small effect on (1) 3 Gemba (also translated as genba) is the Japanese term
for “actual place” and is often used to refer to the location where work occurs.Exhibit 1.
Value Stream Map of Hotel OperationsThis document is authorized for use only in Miguel
Angel Heras©s 20/21 - Fund. Excelencia Operativa/Found. Operational Exc. (BBA) at
ESADE - Barcelona from Jan 2021 to May 2021.
TB0389 5safety, (2) quality, (3) delivery, (4) inventory, or (5) productivity and cost. These
were the five key dimensions on which all areas were evaluated. Wastes that appeared in
the top left (easy to remove, large impact) quadrant (circled) were the first targets of
opportunity for the remain-ing days of the kaizen event. At the close of Day 2, the kaizen
team pre-sented the work it had done so far to the property’s executives. The team shared
its value stream map, waste-prioritization matrix, and other analyses. This meeting had
three goals. First, the exchange of information at the meeting helped ensure that senior
lead-ers recognized the goal of the kaizen event, understood the analyses the team had per-
formed, and supported the direction the team was headed. Second, the checkpoint meeting
provided an opportunity to seek senior execu-tives’ assistance in removing barriers the
team anticipated (e.g., the need to purchase equip-ment, or a request for help in rearranging
a workspace). Third, the department manager’s involvement in the kaizen team’s
presentation helped ensure his or her commitment to the changes the team was
developing.• Kaizen Day 3On Day 3, the team identified the root cause of each waste in the
easy-to-remove, large impact quadrant of the matrix generated in Day 2. In seeking out root
causes, kaizen teams relied heavily on the Five Whys lean tool. This technique involves
asking why five (or more) times whenever a problem or waste is encountered. For example,
a team observed that buffet attendants routinely polished clean silverware. When queried,
the area’s supervi-sor noted that over a typical 24-hour period, about four hours of
employee time was spent polishing clean silverware. Applying the Five Whys to this waste
of motion, the team asked and answered the following series of questions:• Why are
attendants spending four hours a day polishing clean silverware?– Because the silverware
has spots that create an unacceptable presentation on the dining table. • Why does the
silverware have spots on it?– Because the silverware comes out of the dishwasher with
spots on it. • Why does the dishwasher leave spots on the silverware?– The dishwasher
doesn’t hold a consistent temperature during one of the phases of the cleaning cycle.Exhibit
2. Spaghetti Diagram of Sandwich ProductionExhibit 3. Waste Prioritization MatrixThis
document is authorized for use only in Miguel Angel Heras©s 20/21 - Fund. Excelencia
Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to May 2021.
6 TB0389• Why is one phase of the cleaning cycle not holding a consistent temperature?–
One portion of the current preventive maintenance protocol is not consistent with what the
manufacturer suggests in the dishwasher’s operating manual.• How can we remedy the
situation?– Revise the preventive maintenance protocol to make it consistent with the
manufacturer’s guidelines.Based on this analysis, team members revised and adopted new
preventive maintenance practices, and con-tinued to evolve them over time. • Kaizen Day

7. 4Day 4 was devoted to try-storming—proposing and testing possible remedies to root
causes of problems identified the prior day. For example, the team investigating the waste
of motion in polishing clean silver-ware agreed to commit to better pre-wash procedures,
and to institute routine preventive maintenance to clear obstructions in the dishwasher
tubing before they could affect the rinse water temperature. Preventive maintenance design
and scheduling were among the lean solutions frequently called upon to remove waste from
processes during kaizen events. In another example, the team examining kitchen processes
try-stormed options for arranging kitchen equipment and supplies to reduce the time and
motion involved in preparing sandwiches. Exhibit 4 shows the spaghetti diagram of
sandwich production in the revised kitchen layout (as contrasted with Exhibit 2). Locating
together the items needed for sandwich production (an example of work-cell creation)
vastly streamlined the time and motion required. Another LEAN tool used by almost every
team in the try-storming phase was 5S, a term referring to principles for creating a visual
work environment that is easy to understand, execute, and maintain. The concept was
originally drawn from five Japanese words: seiri, seiton, seiso, seiketsu, and shitsuke. These
have been translated into numerous S-words in languages around the world. In English, the
5S are typically expressed as sort, set in order, shine, standard-ize, and sustain.1. Sort: “If in
doubt, throw it out” is the phrase that best describes this first S. Sift through everything that
has accumulated in the workplace and identify what is needed. Eliminate unnecessary or
out-of-date items. 2. Set in Order: “A place for everything and everything in its place”
describes the set-in-order concept. As-sign essential items to specific locations and clearly
mark these locations. The objective is for anyone to be able to find anything at any time
quickly, and for it to be obvious when things are not in their proper place. 3. Shine: Clean
and inspect the workplace. After sorting and setting in order, houseclean thoroughly to
ensure that everything is clean, neat, and functioning properly. 4. Standardize: Standardize
means to create and enforce policies and procedures that make 5S a daily practice, not a
one-time activity. This typically entails assigning responsibilities and putting in place
policies such as a daily five-minute shine—a brief period each day devoted to cleaning and
ordering the workplace. 5. Sustain: Sustain means to institutionalize the above 4S’s
throughout the entire organization so that 5S develops deep roots.4 Training,
communication, ongoing measurement, and promotion of 5S are essential building blocks of
sustain. 4 P. Dennis, Lean Production Simplified (New York: Productivity Press, 2007, p.
35).Exhibit 4. Spaghetti Diagram of Sandwich Production after Try-StormingThis document
is authorized for use only in Miguel Angel Heras©s 20/21 - Fund. Excelencia
Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to May 2021.
TB0389 7In applying 5S at Tunica, teams began by removing everything from the area
under study and placing each item into one of three piles: (1) items that were definitely
needed and used, (2) items about which the team was not sure of the need, and (3) items
that were definitely not needed. Items in the not-needed pile were discarded or repurposed.
Items in the definitely needed pile were set in order—placed in a designated area. Next, the
team turned to the not-sure-of-the-need pile. Having just set in order the definitely needed
items, teams were able to take a fresh look at items in the not-sure-of-the-need pile. Teams
often concluded that much of the not-sure pile could be discarded or repurposed.A kaizen

8. event in the buffet kitchen applied 5S to the dry-goods storage area, where inventory was
not sys-tematically organized (see Exhibit 5, left side). Retrieving a specific item might
require a lengthy search, and items, once located, could potentially have passed their
expiration dates. Further, duplicate items might be ordered if the on-hand item could not be
located quickly. The kaizen team studying the dry-goods storage area discarded $8,000
worth of unused inventory, established dedicated storage locations for the items that
remained, marked the maximum inventory levels with tape on the wall, and used eye-level
labels with pictures to show what went where (see Exhibit 5, right side). The effort
simplified ordering and increased the speed with which items could be retrieved for use in
serving customers.To address the inventory challenge of slot paper described earlier, the
kaizen team dedicated a lined-off space in the warehouse for the boxes of slot paper and
created a visual two-bin system. Two stacks of slot paper, each of which represented a two-
week supply, were located side-by-side. Team members placed a strip of tape on the wall
indicating the maximum height of the stacked boxes of paper. They added clear signage that
reminded warehouse personnel to withdraw boxes from only one stack at a time until it
was depleted. Depletion of the first stack triggered an order timed to arrive before the
second stack ran out (see Exhibit 6). This system eliminated unnecessary orders and
reduced the annual inventory investment by $60,000. And, because warehouse workers had
been part of the kaizen team that developed this solution, they readily embraced the new
work procedures. Through the application of simple tools, such as 5S, a kaizen event
typically eliminated anywhere between 25%-90% of the waste observations. This was a
powerfully motivating and rewarding exercise for employees who were able to see that they
could immediately remove obstacles and improve frustrating aspects of their work through
the kaizen process.Exhibit 5. Before and After 5S in Main Kitchen Dry-Goods Storage Exhibit
6. 5S Two-Bin SystemThis document is authorized for use only in Miguel Angel Heras©s
20/21 - Fund. Excelencia Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona
from Jan 2021 to May 2021.
8 TB0389• Kaizen Day 5On the morning of the last day of a kaizen week, the team presented
its work to the property executive team and managers. Team members shared their value
stream maps, waste analysis and try-stormed solutions, and described the follow-on
improvements they planned to make, but could not complete, in the five-day kaizen event
window. These action items identified, but not yet implemented, were captured in the area’s
Kaizen Newspaper, which was posted in the work area and became part of the daily-
management metrics board (see Exhibit 9). The presentation on the last day was
informative for senior leaders, and it also allowed them to recognize kaizen team members
for their hard work and reinforce the cultural shift taking place. Post-Kaizen PillarsThe
week-long kaizen events pro-vided the foundation for creating a LEAN culture. Solidifying
the gains and maintaining momentum to truly transform the organization required more
than these week-long events, however. Caesars Tunica’s House of LEAN (see Exhibit 7)
relied on three post-kaizen pillars: standard work, key performance indicators, and a focus
on daily problem solving reinforced through gemba walks. • Standard Work Every kaizen
event resulted in new ways of performing routine work activities, and each new work
process was documented with easy-to-follow instructions that included pictures and listed

9. the tools required (see Exhibit 8). This standard work became the prescribed and
repeatable way of performing the task. • Key Performance Indicators: The Daily-
Management Metrics Board Measurement played an essential role in keeping areas
accountable for maintaining and extending the improvements made during the kaizen
event. “You get what you measure,” as the management adage holds. After each kaizen
event, employees in the work area developed a set of key performance indicators (KPIs)
that were consistent with the company’s overall operating objectives of safety, workplace
organization (5S), quality, delivery, inventory, and productivity-cost. These indicators (one
or two per objective) were tracked on a KPI Board posted in each area and updated on a
daily basis. Performance was coded as red (below expected performance) or green (at or
exceeding expected performance). In addition to the key metrics, the visual board also
displayed the name of the individual responsible for maintaining the board, the list of
ongoing improvement efforts generated during the most recent kaizen week, and the area’s
standard work SOPs (standard operating procedures). The board documented barriers to
service the team had identified and described countermeasures the team had developed for
removing or overcoming these barriers. For example, a barrier to service quality for one
team was insufficient training on the new standard work, which had been developed during
the kaizen event. To address this, the team planned additional training. Exhibit 9 shows the
standard board format adopted throughout the organization.• Daily Problem Solving,
Gemba Walks, and Executive Engagement The KPI Board became the focus of daily problem
solving. At a designated time each day, area team members gathered around the board to
discuss performance, report barriers, share improvement ideas, and decide on next steps.
Once a week, representatives from Tunica’s executive team conducted gemba walks to
observe processes and hear from process teams about their ongoing improvement efforts.
In each process area, the team and executives Exhibit 7. Tunica’s House of LEANThis
document is authorized for use only in Miguel Angel Heras©s 20/21 - Fund. Excelencia
Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to May 2021.
TB0389 9gathered around the area’s KPI Board to discuss red metrics and the status of
countermeasures. The team also shared the progress it was making in addressing the to-do
items identified during the most recent kaizen event and requested support, where needed,
from managers and executives. This ongoing engagement of top-level leaders was essential
to sustaining momentum. The company CEO, who had encouraged Tunica to develop a
LEAN culture, followed the efforts of the program closely, participated in gemba walks
while on site, and personally called employees to thank them for their improvement efforts.
Exhibit 8. Standard WorkExhibit 9. KPI-Indicator Board Standard FormatThis document is
authorized for use only in Miguel Angel Heras©s 20/21 - Fund. Excelencia
Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to May 2021.
10 TB0389LEAN Results in TunicaIn a little over a year, Hirsch and his team had conducted
over 60 kaizen events, and more than 400 employees had invested over 14,000 hours5 in
the effort. Further, all 34 company vice-presidents and directors had par-ticipated in kaizen
events. Service scores had improved in areas across the businesses, and many areas reached
the required three percent shift from B to A scores needed to maximize employee service
bonuses. Moreover, waste elimination had generated documented annual cost savings of $3

10. million. After witnessing these positive results and seeing evidence of support from the top,
departments began asking for kaizen events and employees requested opportunities to
participate on kaizen teams. Managers and employees alike viewed the effort as an effective
way of instilling a continuous improve-ment mindset in the organization. An IT manager
observed, “Having done a few kaizen events, I continue to see that this is a true employee
engagement tool.” An accounting clerk who participated in a kaizen event noted, “It was
great to be considered an equal participant and to have input on big decisions that affect our
work and department.” One of the team’s cooks commented, “LEAN ought to be a way of life
here.” And a table games supervisor said, “I wish these kaizens had been implemented a
long time ago. It would have made our jobs easier.” A janitorial team member offered this
perspective: The LEAN program is a fantastic idea. It made my job a whole lot easier and
less stressful. The LEAN two-bin system eliminated the time I had to spend unnecessarily
counting inventory each day. I also feel more valuable to the property because I now play a
role in ensuring my co-workers get what they need to keep our property clean. I still can’t
believe our CEO took the time to call me on my cell phone to ask me about LEAN and
congratulate me on our success.Reflections on the Tunica ExperienceReflecting on the
successful effort at Tunica, Hirsch was cognizant of several important lessons. One was the
vital role of senior leaders. Without their support, Hirsch knew the effort would have
faltered. Their engage-ment—from participating in kaizen events, to routinely leading
gemba walks—was key in demonstrating to the organization that LEAN was real and here
to stay. Still, he observed, there were some leaders, primarily at the middle-management
level, who were at times slower to adopt new operating practices or embrace the LEAN
cultural shift. In many cases, these managers were fearful of departing from long-standing
operational practices they personally designed, and thus were more inclined to defend.
Furthermore, some managers could tend to feel that a decision to abandon an existing
process was a sign that senior leaders lacked confidence in their tech-nical expertise. Hirsch
and the other members of the Regional LEAN Team recognized, early on, the challenge
resistance to change could present and how it must be addressed to move the organization
forward. Another challenge within the organization was obtaining the financial support to
make physical changes (e.g., moving equipment) to implement kaizen recommendations.
Physical changes sometimes required the kaizen event leader to seek higher-level approval
for the release of funds above a department’s current repair and maintenance budget.
Initially, obtaining additional financial support was a challenge because the senior leader-
ship team sought to maintain expense discipline throughout the business. However, once
the kaizens began to yield tangible benefits, much of the hesitation to fund infrastructure
changes diminished. The Tunica experience also convinced Hirsch that the shock-and-awe
implementation philosophy Caesars casinos embraced had been effective. The team
designed the kaizen events to be lightning fast and generate im-mediate results that would
convince the rest of the organization that the initiative had merit. Hirsch observed: “Our
regional leadership team wanted to make it so big that our team members could feel the
earth tremble with operational improvements. This occurred as a direct result of how the
Tunica team began to embrace the intense kaizen spirit and the support we received in
areas from the senior leadership team to Facilities to IT and everyone in between. Everyone

11. played a part.”5 Based on the assumption that 400 employees engaged in at least one five-
day kaizen event in which they invested about 36 hours (4.5 eight-hour days—events
concluded at noon on Friday): 400 employees * 4.5 days * 8 hours/day = 14,400 employee
hours. This document is authorized for use only in Miguel Angel Heras©s 20/21 - Fund.
Excelencia Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to
May 2021.
TB0389 11At the beginning of the LEAN initiative, Hirsch and his leadership team thought
planning and executing the kaizen events would be the most difficult aspect of
implementation. In reality, this had been fairly straightforward and extremely energizing
for Hirsch’s team and workshop participants. What proved especially challenging was
sustaining the gains after a kaizen event. “We were constantly fighting the headwind to go
back to the way things had been done before.” It seemed to be human nature to drift
backward to pre-LEAN behaviors. The post-event emphasis on development of standard
work, the use of KPI boards to monitor performance, and the daily problem solving and
gemba walks had helped to maintain momentum. Follow-up training also played an
important role. According to Hirsch: “Our Human Resources training team did a great job
designing and executing training for all team members affected by process changes
stemming from kaizen events. In a 24/7 business, this proved to be a very good
countermeasure to help with team member buy-in and continuing support.” However,
Hirsch acknowledged that all of these efforts required significant commitment and time.
Hirsch believed the organization had created innovation around, and embraced, the grand
objective of creating a culture where problem solving, waste removal, and customer service
improvement were ongoing parts of everyone’s job. Onward to MetropolisThe Metropolis,
Illinois, casino was opened in 1993 and initially located on the Ohio River along the border
between Illinois and Kentucky.6 Caesars acquired the facility in 2000 and had operated it
since then under the Harrah’s nameplate. In addition to the riverboat that originally housed
the casino, the site also included a con-vention center, several restaurants, and a 258-room
hotel. In a typical year, Harrah’s Metropolis hosted more than 600,000 visitors.In November
2014, Harrah’s Metropolis Casino was relocated from the riverboat to the former
convention center space adjacent to the original land-based hotel. The new facility was a
significant strategic capital project aimed at improving the casino’s competitive position
with a state-of-the art gaming floor, increased entertainment offerings, expanded food and
beverage amenities, and improved accessibility and comfort for customers. The new single-
level gaming floor featured more than 800 slot machines, 23 table games, a World Series of
Poker room, new restaurant, entertainment lounge, and three new bars. Increasing
competition was an important factor in Caesars’ decision to invest almost $9 million to re-
locate and renovate the Metropolis casino. The previous two years had seen the growth of
competing gaming options in both Illinois and Kentucky. In Illinois, recently passed
legislation permitted certain enterprises (bars, restaurants, truck stops, and fraternal
organizations such as the Knights of Columbus or Elks Club) to operate video-gambling
machines. By one estimate, there were more than 15,000 such machines in enterprises
across the state by the end of March 2014. 7 In Kentucky, so-called Instant Racing8 allowed
bettors to place wagers on previously run horse races using a slot machine-like device.

12. Despite issues around its legality,9 instant racing was gaining in popularity. The Caesars
management team recognized that the Harrah’s Metropolis property needed to be seen by
patrons and potential patrons as offering an entertainment experience that went well
beyond the video-gambling options readily available in other venues. The Harrah’s
Metropolis executive team also knew that non-gaming hospitality was becoming
increasingly important in the casino industry. Casinos in Las Vegas were experiencing well-
documented increases in customer non-gaming spending, and Harrah’s Metropolis patrons
indicated a strong desire to enjoy additional non-gaming experiences during their trips.
Taking steps to ensure that the organization efficiently delivered hospitality service that
customers scored as A-level promised to have a positive effect on the bottom line. But what
was the best way to make this happen?6 Metropolis (population 6,500), located in southern
Illinois, was considered part of the Paducah, Kentucky, Metropolitan Statistical Area
(population 100,000).7 Kurt Erickson, “Video Gaining: Illinoisans Get a Piece of the Action,”
Illinois Issues, June 2014.
http://illinoisissues.uis.edu/archives/2014/06/videogaming.html (accessed October 25,
2014).8 A race was randomly selected from a library of more than 50,000 races without
identifying information such as location, racetrack, horses running, or jockey. Based on
limited racing-sheet information, the player placed a bet. The video ran and the outcome
was revealed.9 http://www.kentucky.com/2014/02/20/3099342_kentucky-supreme-
court-sends-instant.html?rh=1.This document is authorized for use only in Miguel Angel
Heras©s 20/21 - Fund. Excelencia Operativa/Found. Operational Exc. (BBA) at ESADE -
Barcelona from Jan 2021 to May 2021.
12 TB0389Hirsch believed that an organization-wide process-improvement effort could
contribute to the financial success of Harrah’s Metropolis. As he walked the new casino
floor, he saw opportunities to eliminate waste—from excited patrons waiting for big jackpot
payouts, to execution of inventory management for the new restaurant. Although any one
improvement might seem trivial, ignoring these small wastes could lay the organization
open to death by a thousand small cuts. The Harrah’s Metropolis executive team had
delivered a successful construc-tion project and opening, and the move to the new location
seemed an ideal time to make a renewed push for continuous operational improvement.One
thing that puzzled Hirsch, however, was the best approach to take. The initiative he led in
Tunica had demanded significant time commitments from all levels of the organization. An
alternative for Metropolis was to deploy a small group of highly skilled process-excellence
experts who were experienced in the application of LEAN principles and tools. These
individuals would be charged with improving internal processes and procedures, although
all employees would be expected to contribute improvement ideas through various means
(employee focus groups, suggestion systems, and other avenues). This approach could offer
a more efficient route to ongoing improvement because it would not take employees away
from their work responsibilities for extended periods of time. With expertise-based process
improvement, Hirsch’s team would not have to train line employees to analyze and improve
processes. He believed the cost and time involved would be significantly less than at
Tunica.The resource challenges associated with leading a single property also argued for a
more top-down approach at Metropolis. At Tunica, Hirsch had access to regional resources

13. from three properties, enabling him to borrow employees from other facilities to cover the
work responsibilities of those participating in kaizen events. That would not be as easy at
Metropolis, with only 600 employees and a single facility—high-involvement kaizen event
activities could result in insufficient coverage of key service areas. A dedicated team of
LEAN experts would take the load off of employees and keep services running. On the other
hand, he remembered how energizing it was for employees to be involved in making their
own work better. As Hirsch scanned the gaming floor, he wondered what his next steps
should be.This document is authorized for use only in Miguel Angel Heras©s 20/21 - Fund.
Excelencia Operativa/Found. Operational Exc. (BBA) at ESADE - Barcelona from Jan 2021 to
May 2021.
TB0389 13Appendix A: Background on LEAN ConceptsLEAN management, adapted in the
West from the Toyota Production System, is a philosophy of continuous improve-ment that
seeks to increase the competence with which an organization’s processes can deliver value
to customers. Its core aim is to eliminate waste that occurs in the form of waiting, rework,
excess production, and so forth. Womack and Jones in their seminal book, Lean Thinking,
describe the essence of lean in five key principles.1 These principles, which originated in
manufacturing contexts, had been successfully translated to the service sector.1. Determine
what the customer wants. Begin by understanding what the customer values in the product
or service. 2. Eliminate waste from the value stream. Determine how value is currently
delivered to customers by studying the value stream and identifying and eliminating
wasteful steps and activities. 3. Wherever possible, use continuous flow. After eliminating
wasteful activities, with the steps that remain, keep the work flowing, without delay, from
step to step. This involves locating successive operations in close proximity (a concept
associated with work cells) to produce items or serve customers one at a time, with each
item or customer passed immediately to the next step without interruption or delay. In
manufacturing contexts, this is known as one-piece flow. Continuous flow eliminates the
delays and inventory associated with producing in large batches, where the entire batch is
completed at one step before any of the items in the batch move to the next step. The
concepts apply just as easily to services: customers flow seamlessly from one step to the
next without delay, and do not find themselves inventoried in long queues or waiting
areas.4. Use pull (not push) to govern how material flows between steps. Where continuous
flow is not possible, let customer demand govern how much and when to produce.
Individual supplier steps should produce only what is required to replenish what has been
used by the consuming step. In some service settings, pull is a given because custom-ers
(e.g., patients, legal clients, restaurant patrons, casino guests,) can’t be processed in advance
of their arrival or expressed desire for the service. But, in more production-oriented
activities such as restaurant services, pull implies accumulating food supplies at levels that
meet demand, avoiding the waste of spoilage or the risk of serving unfresh food to
customers.5. Manage toward perfection: Continuously improve every process. In LEAN
parlance, a value stream is all the steps required to complete a product or service from
beginning to end. Although LEAN has traditionally been applied to the transformation of
physical goods, value streams exist in any pro-ductive effort. A customer’s journey inside a
casino—from arrival to departure—involved many different value streams, each of which

14. delivered a product or service experience: valet parking, hotel check-in, food and beverage
services, gaming, housekeeping operations, retail activities, spa services, and so on. Each of
these value streams was a potential target of op-portunity where waste could be identified
and eliminated with the objectives of improving the customer experience—and the
organization’s profitability—by delivering a product or service better, faster, and at lower
cost. 1 J. Womack and D. Jones, Lean Thinking: Banish Waste and Create Wealth in Your
Corporation (New York: Free Press, 2003).This document is authorized for use only in
Miguel Angel Heras©s 20/21 - Fund. Excelencia Operativa/Found. Operational Exc. (BBA)
at ESADE - Barcelona from Jan 2021 to May 2021.
QSO 325 Final Project Guidelines and Rubric
Overview Continuous improvement processes are used to solve problems in multiple types
of businesses and industries, including manufacturing and production, service, office
environments, and the military. Continuous improvement processes are important because
they allow organizations to identify problems, develop and implement solutions, and then
evaluate the solutions for their effectiveness in solving the identified problems. Continuous
improvement tools and techniques are used to help organizations reduce costs, improve
effectiveness and efficiency, and increase productivity. In this assessment, you will analyze a
company in a comprehensive case study (“Implementing LEAN Operations at Caesars
Casinos” in your custom Textbook/Case Study Bundle) and write a report of your findings
(review the Case Study Introduction document). You will begin by identifying a problem
facing the company in the case study. Next, you will interpret the data (found in an Excel
spreadsheet) related to the problem and create a graphical representation of the data.
Finally, you will apply the plan-do-check-act (PDCA) cycle to the problem. This assessment
will address the following course outcomes: Solve operations management problems in
real-world contexts by applying continuous improvement tools andtechniques Propose
solutions to operational issues that support sustainable operations through use of
continuous improvement best practices Promote organizational effectiveness by applying
the phases of the continuous improvement cycle to operations andresourcemanagement
Create graphical interpretations of data that promote continuous improvement and inform
decision making for meetingorganizationalgoals Prompt Your report should answer the
following prompt: You will submit a report in which you analyze the company in the
Caesars Casinos case study using the plan-do-check-act (PDCA) cycle. Your report will
include an introduction where you provide an overview of the company and identify a
problem the company is facing. Then, you will interpret the data provided to you and create
a graphical representation of the data. As part of your application of the PDCA cycle, you will
identify a solution to the problem you identified, develop a plan for testing the solution,
analyze the results of the changes implemented to test the solution, and, finally, evaluate the
solution.
Specifically, the following critical elements must be addressed: I. Introduction A. Company:
Which company is discussed in the case study? What are the company’s goals? Who are the
company’s stakeholders? Describe the company, its goals, and its stakeholders. B. Problem:
Describe a problem that the company in the case study is trying to solve. How is the

15. problem preventing the company from meeting its goals? How does the problem affect the
company’s stakeholders? C. Resources: Analyze the company’s resource management. In
other words, is the company managing its resources effectively? How is the effectiveness of
the resource management related to the problem youidentified? II. Data: Interpret the
initial data provided in the case study. How does the data relate to the problem the
company is trying to solve? How does the data show you that the company is not meeting
itsgoals? III. Graphical Representation A. Creation: Create a graphical representation of the
initial data provided in the case study. For example, you could create a Pareto chart, an X-
bar and R chart, or a histogram. Make sure your graphical representation is clearlylabeled.
B. Explanation: Explain the graphical representation. What does it show? How will it help
the stakeholders make informeddecisions? IV. Continuous Improvement Cycle: Use the
PDCA cycle to address the problem in the case study. A. Plan 1. Solution: Identify a solution
in the case study that addresses the problem and supports the sustainable operations of the
company. Which continuous improvement best practices can you apply to the solution
youidentified? 2. Plan: Develop a plan to implement the solution. Explain how the plan
supports organizationaleffectiveness. B. Do: How can the company in the case study test the
solution? Describe the changes that the company could implement to test the solution. What
data could be collected to show the effectiveness of the changes the company implements to
test the solution? C. Check 1. Analysis: Analyze the data produced after the company
implements changes to test the solution (the data collected could be qualitative or
quantitative). Does the data support the proposed solution to the problem? Why or why
not? 2. Graphical Representation: Create a graphical representation of the data collected
after changes were implemented to test the solution. For example, if your data is qualitative,
you could create a pie chart. If your data is quantitative, you could create an X-bar and R
chart or a p-chart. Make sure your graphical representation is clearly labeled. D. Act 1.
Evaluation: Evaluate the solution. Did the solution address the problem you identified? Why
or whynot? 2. Adjustments: What adjustments could the company make to the solution
based on the data collected after changes were implemented to test the solution? If the
solution was not completely successful, what new solution could beproposed?
3. Reflection: Reflect on the company’s choices in applying
continuous improvement tools and techniques. What decision(s) would you have made that
differ from the decisions the company made? How can the company continue to apply
continuous improvement tools and techniques to promote organizational effectiveness?
Provide examples to support yourreflection. Rubric Guidelines for Submission: The report
should be submitted as a Word document and should follow standard APA guidelines.
Critical Elements Exemplary (100%) Proficient (85%) Needs Improvement (55%) Not
Evident (0%) Value Introduction: Company Meets “Proficient” criteria, and description is
exceptionally clear and detailed Comprehensively describes company, goals, and
stakeholders Describes company, goals, and stakeholders, but description is cursory or
inaccurate Does not describe company, goals, and stakeholders 7 Introduction: Problem
Meets “Proficient” criteria, and description shows keen insight into effect of problem on
company’s goals and stakeholders Clearly describes problem and its effect on the
company’s goals and stakeholders Describes problem, but does not describe effect of

16. problem on the company’s goals and stakeholders, or description lacks clarity Does not
describe problem 7 Introduction: Resources Meets “Proficient” criteria and draws clear
connection between effectiveness of resource management and identified problem
Accurately analyzes the company’s resource management and relates effectiveness to
identified problem Analyzes the company’s resource management, but does not relate
effectiveness to identified problem, or analysis is inaccurate Does not analyze the
company’s resource management 7 Data Meets “Proficient” criteria, and interpretation is
exceptionally logical and detailed Accurately interprets data and relates data to problem
and goals of company Interprets data, but does not relate data to problem and goals of
company, or interpretation is inaccurate Does not interpret data 7 Graphical
Representation: Creation Meets “Proficient” criteria, and graphical representation is
exceptionally clear and contextualized Creates clearly labeled graphical representation of
data Creates graphical representation of data, but graphical representation is not clearly
labeled Does not create graphical representation of data 7 Graphical Representation:
Explanation Meets “Proficient” criteria, and explanation is exceptionally clear and detailed
Clearly explains graphical representation and how it will help stakeholders make informed
decisions Explains graphical representation, but does not explain how it will help
stakeholders make informed decisions Does not explain graphical representation 7
Continuous Improvement Cycle: Plan: Solution Meets “Proficient” criteria, and application of
continuous improvement best practices shows nuanced insight into relationship between
proposed solution and identified problem Proposes a solution that addresses the problem
and supports the sustainable operations of the company by applying continuous
improvement best practices Proposes a solution that addresses the problem, but solution
does not support the sustainable operations of the company by applying continuous
improvement best practices Does not propose a solution that addresses the problem 7
Continuous Improvement Cycle: Plan: Plan Meets “Proficient” criteria, and plan and
explanation are exceptionally logical and detailed Develops a plan to implement the
proposed solution andclearly explains how the plan supports organizational effectiveness
Develops a plan to implement the proposed solution, but does not explain how the plan
supports organizational effectiveness, or explanation lacks clarity or detail Does not
develop a plan to implement the proposed solution 7 Continuous Improvement Cycle: Do
Meets “Proficient” criteria, and description includes specific examples that connect the
changes that could be implemented to test the solution to the data that could be collected
Clearly describes changes that could be implemented to test the solution and data that could
be collected to show the effectiveness of the changes Describes changes that could be
implemented to test the solution, but does not describe data that could be collected to show
the effectiveness of the changes, or the description lacks clarity or detail Does not describe
changes that could be implemented to test the solution 7 Continuous Improvement Cycle:
Check: Analysis Meets “Proficient” criteria and draws clear connections between the data
and the proposed solution Accurately analyzes the data produced after company
implements changes and explains how the data supports the proposed solution to the
problem Analyzes the data produced after the company implements changes, but does not

17. explain how the data supports the proposed solution to the problem, or analysis is cursory
or inaccurate Does not analyze the results of the small-scale study 7 Continuous
Improvement Cycle: Check: Graphical Representation Meets “Proficient” criteria, and
graphical representation is exceptionally clear and contextualized Creates a clearly labeled
graphical representation of the data collected after changes were implemented to test the
solution Creates graphical representation of data collected after changes were implemented
to test the solution, but graphical representation is not clearly labeled Does not create
graphical representation of the data collected after changes were implemented to test the
solution 7 Continuous Improvement Cycle: Act: Evaluation Meets “Proficient” criteria, and
evaluation is qualified with specific details and examples Accurately evaluates the solution
and explains how it addresses the identified problem Evaluates the solution, but does not
explain how it addresses the identified problem, or evaluation is cursory or inaccurate Does
not evaluate the solution 7 Continuous Improvement Cycle: Act: Adjustments Meets
“Proficient” criteria, and adjustments are qualified with insightful examples Identifies
appropriate adjustments the company could make to the solution based on data Identifies
adjustments the company could make to the solution, but the adjustments are not based on
data or are not appropriate Does not identify adjustments the company could make to the
solution based on data 7
Continuous Improvement Cycle: Act: Reflection Meets “Proficient” criteria, and
supporting examples show insight and understanding of company and continuous
improvement tools and techniques Discusses company’s choices in applying continuous
improvement tools and techniques and provides supporting examples Discusses
company’s choices in applying continuous improvement tools and techniques, but does
not provide supporting examples Does not discuss company’s choices in applying
continuous improvement tools and techniques 7 Articulation of Response Submission is
free of errors related to citations, grammar, spelling, syntax, and organization and is
presented in a professional and easy-to-read format Submission has no major errors
related to citations, grammar, spelling, syntax, or organization Submission has major
errors related to citations, grammar, spelling, syntax, or organization that negatively
impact readability and articulation of main ideas Submission has critical errors related to
citations, grammar, spelling, syntax, or organization that prevent understanding of ideas 2
Earned Total 100%