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Nee help!! I left out part of the instructions on this one that I
submitted the other day so the paper is not the correct company.
I need a new one with the correct company ASAP!!
This week’s paper is required to be approximately 4 -6 pages in
length, not including the title page and the reference page. No
paper should be fewer than 1400 words.
Double space your work, cite your work,
limit quotes
, and edit your work well for spelling, grammar, and
punctuation errors. If you have quotes included in your paper,
you should have more than 1400 words to compensate. Your
work will be automatically reviewed by Turnitin upon
submission. Please make sure you have cited your work
properly. Utilize the APA resource material provided in the
lessons section of the classroom under course materials.
After reading chapters 9 & 10 from week 6 and reading chapters
11 & 12 from week 7 you should have an understanding of the
types of strategic control, the need for balance between rewards,
culture, and boundaries, the pros and cons of different
organizational structures, the elements of effective leadership,
ethics programs, the types of risk a company may take.
Give examples using the terms and concepts in your textbook
and your research articles. (Terms to choose from from text:
strategic control
,
traditional approach to strategic control
informational control
,
behavioral control
,
organizational culture
reward system
,
boundaries and constraints
,
corporate governance
corporation
,
agency theory
,
board of directors
shareholder activism
external governance control mechanisms
,
market for corporate control
,
takeover constraint
,
principal-principal conflicts
,
expropriation of minority shareholders
,
business groups
,
organizational structure
,
simple organizational structure
,
functional organizational structure
,
divisional organizational structure
,
strategic business unit (SBU) structure
,
holding company structure
,
matrix organizational structure
,
international division structure
,
geographic-area division structure
,
worldwide matrix structure
,
worldwide functional structure
,
worldwide product division structure
,
global start-up
,
boundaryless organizational designs
,
barrier-free organization
,
modular organization
,
virtual organization
,
horizontal organizational structures
,
adaptability
,
alignment
,
ambidextrous organizational designs
,
A. Select a company from Part 5 of our text (Cases). (
USE CASINO INDUSTRY BELOW
). This must be original research. In addition to the
information in your text, research this company using at least
(2) outside scholarly articles. Do not use a website as a
reference. Your reference source must have an author. Give
examples using the terms and concepts in your textbook and
your research articles.
Discuss six selected topics from our studies throughout weeks
six and seven (chapters 9 – 12)(
HERE THEY ARE
: building a strong and effective culture; setting boundaries and
constraints; creating an effective structure; creating an ethical
organization; staffing to capture value from innovation;;
motivating with rewards in incentives;
Discuss these six topics in relation to your company and also
incorporate the issue of managerial economics within your
company and how the economic situation of today influences
the strategic decisions your company is making. Each of the six
topics discussed should be in
bold
print. For example, one topic you may choose may be how
your company attains
balance between culture, rewards, and boundaries
. Another topic may be your company’s
organizational structure
and why they have the structure they have.
B. What is the importance of each of the six topics within your
company?
C. What is the usefulness of understanding this topic in today's
corporate structure?
D. How does managerial economics fit into your topic?
Paper Format (no abstract is necessary):
-Title Page - Include a title page with your name, student
number, title of your paper, course number, course name, &
date.
-Introductory Paragraph - Include an introductory paragraph
that states your company and your six topics and why you
selected them.
-Font and Spacing - Use Times New Roman 12 pitch font with
double-spaced lines.
-Length - Write a 4 to 6 page essay not including the title page
and citation page. Make sure you have at least 1400 words, not
including the title and reference page.
-Reference Page - Include all sources including your textbook
on a separate reference page. Use references with authors, not
websites. All references must have citations within your paper.
-Utilize the APA Style for documenting sources. You will need
to include at least 2 sources in additional to your textbooks.
- Finally, remember Wikipedia is NOT a scholarly source.
-
Punctuation, essay format (thesis, supporting paragraphs with
transition and topic sentences, and summary) grammar and
documentation count toward your grade.
THE CASINO INDUSTRY
*
On February 21, 2013,
Revel
, the only new casino built in Atlantic City in almost a decade,
was preparing to file for bankruptcy. The $2.4 billion
megaresort built on 20 acres of beachfront had opened only
eight months earlier. “We will continue to improve customer
service and roll out new amenities for our guests,” said Kevin
DeSanctis, the casino’s chief executive officer.
1
The fate of the
Revel
has reflected the effect of the recent economic crunch on
casinos, particularly in places like Las Vegas and Atlantic City,
as people have been forced to cut back on their spending.
Even as casinos struggle to show profits, there are growing
concerns about the growth potential of places such as Las Vegas
and Atlantic City over the longer term (see
Exhibit 1
). The economic slowdown forced potential visitors to put off
their travel plans and find some type of casino activity closer to
where they live. As economic conditions improve, it is not clear
how many of these patrons will return to these two major casino
destinations. With some form of casino now allowed in over
half of the states (see
Exhibit 2
), competition is developing all over
EXHIBIT 1 U.S. Casino Industry Gaming Revenues
*
Billions of Dollars
2012
†
36.71
2011
35.64
2010
34.60
2009
34.28
2008
36.22
2007
37.52
2006
35.27
2005
32.77
2004
31.17
2003
28.72
2002
28.07
*
Gaming revenues include the amount of money won by casinos
from various gaming activities such as slot machines, table
games, and sports betting.
†
2012 figure is author estimate, based on recent industry trends.
Source: State Gaming Regulatory Agencies
*
Case developed by Professor Jamal Shamsie, Michigan State
University, with the assistance of Professor Alan B. Eisner,
Pace University. Material has been drawn from published
sources to be used for purposes of class discussion. Copyright ©
2013 Jamal Shamsie and Alan B. Eisner.
EXHIBIT 2 Breakdown of Gaming Revenues by State, 2012
State
Revenue (billions of dollars)
Number and Type of Casinos
NEVADA
10.70
*
256 land-based
NEW JERSEY
3.32
†
11 land-based
INDIANA
2.72
1 land-based, 10 riverboats, 2 racetrack casinos
MISSISSIPPI
2.24
30 land-based dockside
LOUISANA
2.37
1 land-based, 13 riverboats, 4 racetrack casinos
PENNSYLVANIA
3.02
4 land-based, 6 racetrack casinos
MISSOURI
1.81
12 riverboats
ILLINOIS
1.48
10 riverboats
IOWA
1.42
7 land-based, 7 riverboats, 3 racetrack casinos
MICHIGAN
‡
1.42
3 land-based
NEW YORK
1.26
9 racetrack casinos
WEST VIRGINIA
0.96
4 racetrack casinos
COLORADO
0.75
40 land-based
DELAWARE
0.55
3 racetrack casinos
RHODE ISLAND
0.51
2 racetrack casinos
NEW MEXICO
0.25
5 racetrack casinos
FLORIDA
0.38
5 racetrack casinos
SOUTH DAKOTA
§
0.10
35 land-based (limited stakes)
OKLAHOMA
0.10
2 racetrack casinos
MAINE
0.06
1 racetrack casino
KANSAS
0.05
2 land-based
*
$5.50 billion of this revenue comes from the Las Vegas strip.
†
All of this revenue comes from Atlantic City.
‡
All of this revenue comes from Detroit.
§
All of this revenue comes from Deadwood.
Source: 2012 AGA Survey of Casino Entertainment.
C12
the country, led by riverboat casinos and Native American
casinos (see
Exhibit 3
).
Similar concerns are being raised about the growth of
competition in various locations outside the United States. Over
the years, casinos have been developed in various parts of
Europe and Asia, and these compete for the high rollers who
have been frequent visitors to Las Vegas and Atlantic City in
the past. In 2007, Macau replaced Las Vegas as the leading
casino gambling center, after the opening of
Sands Macao
, Macau’s first Las Vegas-style casino, three years ago. Other
Las Vegas-based casinos have also entered this market with
lavish properties, such as
MGM Macau
and
Wynn Macau
.
EXHIBIT 3 States With Native American Casinos, 2012
State
Number of Casinos
Alabama
3
Alaska
2
Arizona
25
California
70
Colorado
2
Connecticut
2
Florida
8
Idaho
8
Iowa
1
Kansas
4
Louisiana
3
Michigan
24
Minnesota
38
Mississippi
3
Missouri
1
Montana
13
Nebraska
6
Nevada
3
New Mexico
22
New York
7
North Carolina
2
North Dakota
10
Oklahoma
114
Oregon
9
South Dakota
11
Texas
1
Washington
34
Wisconsin
29
Wyoming
4
Source: 2012 AGA Survey of Casino Entertainment.
For years, casinos in Las Vegas and Atlantic City have fought
back by developing extravagant new properties. But it has been
harder to obtain financing as the latest additions, such as the
Revel
in Atlantic City and the
Palazzo
in Las Vegas, have failed to draw enough clients. MGM Mirage
had to search for new partners to push ahead with its ambitious
City Center
, which was completed in 2012, although work on one of the
luxury hotel towers has been abandoned. Covering 67 acres, this
$8.5 billion minicity includes luxury hotels, condominium units,
a convention center, and retail space.
Most indicative of the downturn in Las Vegas is the half-
completed
Echelon Place
, on which work has been suspended since 2009. At more than
$4 billion, the 5,000-room hotel and retail complex was
expected to be far more expensive than the previous record for a
single casino, which was set when Steve Wynn built his $2.7
billion
Wynn Las Vegas
. “The last four or five years showed our dependence on the
national economy. We always knew it, but this is the first time
it really hit us,” said Billy Vassiliadis, the head of an
advertising agency that represents the Las Vegas Convention
and Visitors Authority.
2
Riding the Growth Wave
Although some form of gambling in the United States can been
traced back to colonial times, the recent advent of casinos began
with the legalization of gaming in Nevada in 1931. For many
years, this was the only state in which casinos were allowed. As
a result, Nevada still retains its status as the state with the
highest revenues from casinos, with annual gambling revenues
rising to over $10 billion by 2004. After New Jersey passed
laws in 1976 to allow gambling in Atlantic City, the large
population on the East Coast gained easier access to casinos.
The further growth of casinos to other areas has occurred since
1988, as more and more states have legalized the operation of
casinos because of their ability to help generate commercial
activity and create jobs, in large part by increasing tourism.
The greatest growth has come in the form of waterborne casinos
that have begun to operate in six states that have allowed
casinos to develop at waterfronts such as rivers and lakes. By
2012, over 80 such casinos were generating about $10 billion in
annual revenues. Several of the casinos along the Gulf Coast
were destroyed or severely damaged by Hurricane Katrina. To
encourage casinos to rebuild, Mississippi lawmakers passed a
law in 2005 allowing casinos to operate up to 800 feet from the
shore, allowing them to have a stronger foundation to withstand
future hurricanes. Most of the damaged casinos in the area had
reopened by early 2007.
C13
As casinos have spread to more states, there has also been a
growing tendency to regard casino gambling as an acceptable
form of entertainment for a night out. Although casinos have
tended to draw players from all demographic segments, a recent
national survey found that their median age was 47 and their
median household income was around $50,000. On the whole,
casino gamblers tended to be better educated and more affluent
than those who bought lottery tickets. In fact, the bigger casinos
attracted a high-roller segment, which could stake millions of
dollars and included players from all over the world. Many of
the casinos worked hard to obtain the business of this market
segment, despite the risk that the sustained winning streak of a
single player could significantly weaken the earnings for a
particular quarter.
The growth of casino gambling has also been driven by the
significantly better payouts that they give players compared
with other forms of gambling. Based on industry estimates,
casinos typically keep less than $5 of every $100 that is
wagered. This compares favorably with racetrack betting, which
holds back over $20 of every $100 that is wagered, and with
state-run lotteries, which usually keep about $45 of every $100
that is spent on tickets. Such comparisons can be somewhat
misleading, however, because winnings are put back into play in
casinos much faster than they are in other forms of gaming.
This provides a casino with more opportunities to win from a
customer, largely offsetting its lower retention rate.
Finally, most of the growth in casino revenues has come from
the growing popularity of slot machines. These coin-operated
slot machines typically account for almost two-thirds of all
casino gaming revenues (see
Exhibit 4
). A major reason for their popularity is that it is easier for
prospective gamblers to feed a slot machine than to learn the
nuances of various table games. Slot machines were also less
labor intensive than table games. Major slot machine
manufacturers, such as International Game Technology, have
been making the transition to cashless or coin-free gaming by
switching to the use of tickets. With the advent of new
technology, server-based gaming will allow games on these
machines to be changed or updated from a central system.
EXHIBIT 4 Top Five Favorite Casino Games, 2012
Game
Slot machines
53%
Blackjack
23%
Poker
7%
Roulette
3%
Craps
3%
Betting on a Few Locations
Although casinos have spread across much of the country, two
cities still dominate the casino business. Both Las Vegas and
Atlantic City have seen a spectacular growth in casino gaming
revenues over the years. Although Las Vegas has far more hotel
casinos, each of the dozen casinos in Atlantic City typically
generates much higher revenues. Over the last couple of
decades, these two locations accounted for almost a third of the
total revenues generated by all forms of casinos throughout the
United States.
Las Vegas clearly acts as a magnet for the overnight casino
gamblers, offering several high-end casino hotels with many
choices for fine dining, great shopping, and top-notch
entertainment. This allows the casinos to generate revenues
from offering a wide selection of activities apart from
gambling. At MGM Mirage, for example, revenue from
nongaming activities has typically accounted for almost 60
percent of net revenue in recent years. Visitors find it easy to
travel to Las Vegas, as it is linked by air to many major cities
both in the United States and around the world.
During the 1990s, Las Vegas tried to become more receptive to
families, with attractions such as circus performances, animal
reserves, and pirate battles. But the city has been very
successful with its recent return to its sinful roots, with a
stronger focus on topless shows, hot night clubs, and other adult
offerings that have been highlighted by the new advertising
slogan: “What happens in Vegas, stays in Vegas.” Paul
Cappelli, who creates advertising messages, believes that Las
Vegas lost its way with the effort to become family friendly.
“People don’t see Vegas as Jellystone Park. They don’t want to
go there with a picnic basket,” he explained.
3
For the most part, Las Vegas has continued to show a consistent
pattern of growth in visitors. “We still compete with Orlando
and New York,” said Terry Jicinsky, head of marketing for the
Las Vegas Convention and Visitors Authority. “But based on
overnight visitors, we’re the top destination in North America.”
4
In order to accommodate this growth, several of the major
resorts, such as
Bellagio, Venetian
, and
Mandalay Bay
, have added new wings. Even some of the older properties have
been given expensive renovations, such as
Caesars Palace
, which was expanded to include a new Colosseum and a new
Roman Plaza.
By comparison, Atlantic City cannot compete with Las Vegas in
terms of the broad range of dining, shopping, and entertainment
choices. It does, however, offer a beach and a boardwalk, along
which its dozen large casino hotels are lined. Atlantic City
attracts gamblers from various cities in the Northeast, many of
whom arrive by charter bus and stay for less than a day.
Atlantic City officials point out that one-quarter of the nation’s
population lives sufficiently close so that they can drive there
with just one tank of gas.
The opening of the much-ballyhooed
Revel
was part of a drive to try and make Atlantic City much more
competitive with Las Vegas. But it failed to replicate the
success of
Dess, Gregory, G.T. Lumpkin, Alan Eisner, Gerry McNamara.
Strategic Management: Text and Cases, 7th Edition
. McGraw-Hill Learning
Solution
s, 09/2013. VitalBook file.

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Nee help!!  I left out part of the instructions on this one that I s.docx

  • 1. Nee help!! I left out part of the instructions on this one that I submitted the other day so the paper is not the correct company. I need a new one with the correct company ASAP!! This week’s paper is required to be approximately 4 -6 pages in length, not including the title page and the reference page. No paper should be fewer than 1400 words. Double space your work, cite your work, limit quotes , and edit your work well for spelling, grammar, and punctuation errors. If you have quotes included in your paper, you should have more than 1400 words to compensate. Your work will be automatically reviewed by Turnitin upon submission. Please make sure you have cited your work properly. Utilize the APA resource material provided in the lessons section of the classroom under course materials. After reading chapters 9 & 10 from week 6 and reading chapters 11 & 12 from week 7 you should have an understanding of the types of strategic control, the need for balance between rewards, culture, and boundaries, the pros and cons of different organizational structures, the elements of effective leadership, ethics programs, the types of risk a company may take. Give examples using the terms and concepts in your textbook and your research articles. (Terms to choose from from text:
  • 2. strategic control , traditional approach to strategic control informational control , behavioral control , organizational culture reward system , boundaries and constraints , corporate governance corporation , agency theory , board of directors shareholder activism external governance control mechanisms , market for corporate control , takeover constraint , principal-principal conflicts , expropriation of minority shareholders , business groups , organizational structure ,
  • 3. simple organizational structure , functional organizational structure , divisional organizational structure , strategic business unit (SBU) structure , holding company structure , matrix organizational structure , international division structure , geographic-area division structure , worldwide matrix structure , worldwide functional structure , worldwide product division structure , global start-up , boundaryless organizational designs , barrier-free organization , modular organization , virtual organization , horizontal organizational structures , adaptability ,
  • 4. alignment , ambidextrous organizational designs , A. Select a company from Part 5 of our text (Cases). ( USE CASINO INDUSTRY BELOW ). This must be original research. In addition to the information in your text, research this company using at least (2) outside scholarly articles. Do not use a website as a reference. Your reference source must have an author. Give examples using the terms and concepts in your textbook and your research articles. Discuss six selected topics from our studies throughout weeks six and seven (chapters 9 – 12)( HERE THEY ARE : building a strong and effective culture; setting boundaries and constraints; creating an effective structure; creating an ethical organization; staffing to capture value from innovation;; motivating with rewards in incentives; Discuss these six topics in relation to your company and also incorporate the issue of managerial economics within your company and how the economic situation of today influences the strategic decisions your company is making. Each of the six topics discussed should be in bold print. For example, one topic you may choose may be how your company attains balance between culture, rewards, and boundaries . Another topic may be your company’s organizational structure and why they have the structure they have.
  • 5. B. What is the importance of each of the six topics within your company? C. What is the usefulness of understanding this topic in today's corporate structure? D. How does managerial economics fit into your topic? Paper Format (no abstract is necessary): -Title Page - Include a title page with your name, student number, title of your paper, course number, course name, & date. -Introductory Paragraph - Include an introductory paragraph that states your company and your six topics and why you selected them. -Font and Spacing - Use Times New Roman 12 pitch font with double-spaced lines. -Length - Write a 4 to 6 page essay not including the title page and citation page. Make sure you have at least 1400 words, not including the title and reference page. -Reference Page - Include all sources including your textbook on a separate reference page. Use references with authors, not websites. All references must have citations within your paper.
  • 6. -Utilize the APA Style for documenting sources. You will need to include at least 2 sources in additional to your textbooks. - Finally, remember Wikipedia is NOT a scholarly source. - Punctuation, essay format (thesis, supporting paragraphs with transition and topic sentences, and summary) grammar and documentation count toward your grade. THE CASINO INDUSTRY * On February 21, 2013, Revel , the only new casino built in Atlantic City in almost a decade, was preparing to file for bankruptcy. The $2.4 billion megaresort built on 20 acres of beachfront had opened only eight months earlier. “We will continue to improve customer service and roll out new amenities for our guests,” said Kevin DeSanctis, the casino’s chief executive officer. 1 The fate of the Revel has reflected the effect of the recent economic crunch on casinos, particularly in places like Las Vegas and Atlantic City, as people have been forced to cut back on their spending.
  • 7. Even as casinos struggle to show profits, there are growing concerns about the growth potential of places such as Las Vegas and Atlantic City over the longer term (see Exhibit 1 ). The economic slowdown forced potential visitors to put off their travel plans and find some type of casino activity closer to where they live. As economic conditions improve, it is not clear how many of these patrons will return to these two major casino destinations. With some form of casino now allowed in over half of the states (see Exhibit 2 ), competition is developing all over EXHIBIT 1 U.S. Casino Industry Gaming Revenues * Billions of Dollars 2012 † 36.71 2011 35.64 2010 34.60 2009 34.28 2008 36.22 2007 37.52 2006
  • 8. 35.27 2005 32.77 2004 31.17 2003 28.72 2002 28.07 * Gaming revenues include the amount of money won by casinos from various gaming activities such as slot machines, table games, and sports betting. † 2012 figure is author estimate, based on recent industry trends. Source: State Gaming Regulatory Agencies * Case developed by Professor Jamal Shamsie, Michigan State University, with the assistance of Professor Alan B. Eisner, Pace University. Material has been drawn from published sources to be used for purposes of class discussion. Copyright © 2013 Jamal Shamsie and Alan B. Eisner.
  • 9. EXHIBIT 2 Breakdown of Gaming Revenues by State, 2012 State Revenue (billions of dollars) Number and Type of Casinos NEVADA 10.70 * 256 land-based NEW JERSEY 3.32 † 11 land-based INDIANA 2.72 1 land-based, 10 riverboats, 2 racetrack casinos MISSISSIPPI 2.24 30 land-based dockside LOUISANA 2.37 1 land-based, 13 riverboats, 4 racetrack casinos PENNSYLVANIA 3.02 4 land-based, 6 racetrack casinos MISSOURI 1.81 12 riverboats ILLINOIS 1.48 10 riverboats IOWA 1.42
  • 10. 7 land-based, 7 riverboats, 3 racetrack casinos MICHIGAN ‡ 1.42 3 land-based NEW YORK 1.26 9 racetrack casinos WEST VIRGINIA 0.96 4 racetrack casinos COLORADO 0.75 40 land-based DELAWARE 0.55 3 racetrack casinos RHODE ISLAND 0.51 2 racetrack casinos NEW MEXICO 0.25 5 racetrack casinos FLORIDA 0.38 5 racetrack casinos SOUTH DAKOTA § 0.10 35 land-based (limited stakes) OKLAHOMA 0.10 2 racetrack casinos MAINE 0.06 1 racetrack casino
  • 11. KANSAS 0.05 2 land-based * $5.50 billion of this revenue comes from the Las Vegas strip. † All of this revenue comes from Atlantic City. ‡ All of this revenue comes from Detroit. § All of this revenue comes from Deadwood. Source: 2012 AGA Survey of Casino Entertainment. C12
  • 12. the country, led by riverboat casinos and Native American casinos (see Exhibit 3 ). Similar concerns are being raised about the growth of competition in various locations outside the United States. Over the years, casinos have been developed in various parts of Europe and Asia, and these compete for the high rollers who have been frequent visitors to Las Vegas and Atlantic City in the past. In 2007, Macau replaced Las Vegas as the leading casino gambling center, after the opening of Sands Macao , Macau’s first Las Vegas-style casino, three years ago. Other Las Vegas-based casinos have also entered this market with lavish properties, such as MGM Macau and Wynn Macau . EXHIBIT 3 States With Native American Casinos, 2012 State Number of Casinos Alabama 3 Alaska
  • 14. 7 North Carolina 2 North Dakota 10 Oklahoma 114 Oregon 9 South Dakota 11 Texas 1 Washington 34 Wisconsin 29 Wyoming 4 Source: 2012 AGA Survey of Casino Entertainment. For years, casinos in Las Vegas and Atlantic City have fought back by developing extravagant new properties. But it has been harder to obtain financing as the latest additions, such as the Revel in Atlantic City and the Palazzo
  • 15. in Las Vegas, have failed to draw enough clients. MGM Mirage had to search for new partners to push ahead with its ambitious City Center , which was completed in 2012, although work on one of the luxury hotel towers has been abandoned. Covering 67 acres, this $8.5 billion minicity includes luxury hotels, condominium units, a convention center, and retail space. Most indicative of the downturn in Las Vegas is the half- completed Echelon Place , on which work has been suspended since 2009. At more than $4 billion, the 5,000-room hotel and retail complex was expected to be far more expensive than the previous record for a single casino, which was set when Steve Wynn built his $2.7 billion Wynn Las Vegas . “The last four or five years showed our dependence on the national economy. We always knew it, but this is the first time it really hit us,” said Billy Vassiliadis, the head of an advertising agency that represents the Las Vegas Convention and Visitors Authority. 2 Riding the Growth Wave Although some form of gambling in the United States can been traced back to colonial times, the recent advent of casinos began with the legalization of gaming in Nevada in 1931. For many years, this was the only state in which casinos were allowed. As
  • 16. a result, Nevada still retains its status as the state with the highest revenues from casinos, with annual gambling revenues rising to over $10 billion by 2004. After New Jersey passed laws in 1976 to allow gambling in Atlantic City, the large population on the East Coast gained easier access to casinos. The further growth of casinos to other areas has occurred since 1988, as more and more states have legalized the operation of casinos because of their ability to help generate commercial activity and create jobs, in large part by increasing tourism. The greatest growth has come in the form of waterborne casinos that have begun to operate in six states that have allowed casinos to develop at waterfronts such as rivers and lakes. By 2012, over 80 such casinos were generating about $10 billion in annual revenues. Several of the casinos along the Gulf Coast were destroyed or severely damaged by Hurricane Katrina. To encourage casinos to rebuild, Mississippi lawmakers passed a law in 2005 allowing casinos to operate up to 800 feet from the shore, allowing them to have a stronger foundation to withstand future hurricanes. Most of the damaged casinos in the area had reopened by early 2007. C13 As casinos have spread to more states, there has also been a growing tendency to regard casino gambling as an acceptable form of entertainment for a night out. Although casinos have tended to draw players from all demographic segments, a recent national survey found that their median age was 47 and their median household income was around $50,000. On the whole,
  • 17. casino gamblers tended to be better educated and more affluent than those who bought lottery tickets. In fact, the bigger casinos attracted a high-roller segment, which could stake millions of dollars and included players from all over the world. Many of the casinos worked hard to obtain the business of this market segment, despite the risk that the sustained winning streak of a single player could significantly weaken the earnings for a particular quarter. The growth of casino gambling has also been driven by the significantly better payouts that they give players compared with other forms of gambling. Based on industry estimates, casinos typically keep less than $5 of every $100 that is wagered. This compares favorably with racetrack betting, which holds back over $20 of every $100 that is wagered, and with state-run lotteries, which usually keep about $45 of every $100 that is spent on tickets. Such comparisons can be somewhat misleading, however, because winnings are put back into play in casinos much faster than they are in other forms of gaming. This provides a casino with more opportunities to win from a customer, largely offsetting its lower retention rate. Finally, most of the growth in casino revenues has come from the growing popularity of slot machines. These coin-operated slot machines typically account for almost two-thirds of all casino gaming revenues (see Exhibit 4 ). A major reason for their popularity is that it is easier for prospective gamblers to feed a slot machine than to learn the nuances of various table games. Slot machines were also less labor intensive than table games. Major slot machine manufacturers, such as International Game Technology, have
  • 18. been making the transition to cashless or coin-free gaming by switching to the use of tickets. With the advent of new technology, server-based gaming will allow games on these machines to be changed or updated from a central system. EXHIBIT 4 Top Five Favorite Casino Games, 2012 Game Slot machines 53% Blackjack 23% Poker 7% Roulette 3% Craps 3% Betting on a Few Locations Although casinos have spread across much of the country, two cities still dominate the casino business. Both Las Vegas and
  • 19. Atlantic City have seen a spectacular growth in casino gaming revenues over the years. Although Las Vegas has far more hotel casinos, each of the dozen casinos in Atlantic City typically generates much higher revenues. Over the last couple of decades, these two locations accounted for almost a third of the total revenues generated by all forms of casinos throughout the United States. Las Vegas clearly acts as a magnet for the overnight casino gamblers, offering several high-end casino hotels with many choices for fine dining, great shopping, and top-notch entertainment. This allows the casinos to generate revenues from offering a wide selection of activities apart from gambling. At MGM Mirage, for example, revenue from nongaming activities has typically accounted for almost 60 percent of net revenue in recent years. Visitors find it easy to travel to Las Vegas, as it is linked by air to many major cities both in the United States and around the world. During the 1990s, Las Vegas tried to become more receptive to families, with attractions such as circus performances, animal reserves, and pirate battles. But the city has been very successful with its recent return to its sinful roots, with a stronger focus on topless shows, hot night clubs, and other adult offerings that have been highlighted by the new advertising slogan: “What happens in Vegas, stays in Vegas.” Paul Cappelli, who creates advertising messages, believes that Las Vegas lost its way with the effort to become family friendly. “People don’t see Vegas as Jellystone Park. They don’t want to go there with a picnic basket,” he explained. 3
  • 20. For the most part, Las Vegas has continued to show a consistent pattern of growth in visitors. “We still compete with Orlando and New York,” said Terry Jicinsky, head of marketing for the Las Vegas Convention and Visitors Authority. “But based on overnight visitors, we’re the top destination in North America.” 4 In order to accommodate this growth, several of the major resorts, such as Bellagio, Venetian , and Mandalay Bay , have added new wings. Even some of the older properties have been given expensive renovations, such as Caesars Palace , which was expanded to include a new Colosseum and a new Roman Plaza. By comparison, Atlantic City cannot compete with Las Vegas in terms of the broad range of dining, shopping, and entertainment choices. It does, however, offer a beach and a boardwalk, along which its dozen large casino hotels are lined. Atlantic City attracts gamblers from various cities in the Northeast, many of whom arrive by charter bus and stay for less than a day. Atlantic City officials point out that one-quarter of the nation’s population lives sufficiently close so that they can drive there with just one tank of gas. The opening of the much-ballyhooed Revel was part of a drive to try and make Atlantic City much more
  • 21. competitive with Las Vegas. But it failed to replicate the success of Dess, Gregory, G.T. Lumpkin, Alan Eisner, Gerry McNamara. Strategic Management: Text and Cases, 7th Edition . McGraw-Hill Learning Solution s, 09/2013. VitalBook file.