Bally Manufacturing Establishments

In mid1988, Bally Manufacturing owned four casinohotels. The establisments were located in Atlantic City, New Jersey, and in both Las Vegas and Reno, Nevada. Bally also manufactured slot machines, lottery ticket machines, German wall machines, and exercise equipment. Bally also owned and operated a nationwide chain of fitness centers (under the names Jack LaLanne, Health & Tennis Center, and Scandanavian Health Spa), and the Six Flags theme park chain.

By self definition (according to the case), Bally Manufacturing was in the gaming business. This business, for Bally, included both the operation of gambling establishments, and the manufacture of gaming equipment. In spite of Bally's self definition as being in the gaming business, the company also conducted major operations in games manufacture, and in the operation of leisure activities, such as fitness centers, and theme parks.

The recommended strategies for Bally as of mid1988 were to: (1) divest the arcade game operations; (2) sell that part of its gambling equipment business segment involving the development and production of lottery games; (3) continue in the hotel/casino business; (4) maintain both Nevada and New Jersey hotel/casino establishments; (5) continue to target high rollers for some hotel/casino operations; and (6) continue to target low rollers for some hotel/casino operations.

With respect to divesting the company's arcade game operati

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h Spa), and the Six Flags theme park chain. Current Corporate Mission By self definition (according to the case), Bally Manufacturing was in the gaming business. This business, for Bally, included both the operation of gambling establishments, and the manufacture of gaming equipment. In spite of Bally's self 5 definition as being in the gaming business, the company also conducted major operations in games manufacture, and in the operation of leisure activities, such as fitness centers, and theme parks. Management At the time of the case, management at Bally Manufacturing was, in effect, Robert Mullane. At the time of the case, he had been Bally CEO for 10 years, and had been with Bally for a total of 14 years. Mullane's management philosophy was focused on two personallyheld axiomsbiggest is always best, and lucky is better than good. The combination of these axioms led to the development and implementation of policies, which, while they might produce success from time to time, the often also produce instability, chaotic situations, and over leveraged financial positions. Financial During the 19851987 time period, Bally's revenues increased 80.1 percent, while net profits increased by 122.9 percent. The
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Approximate Word count = 2594
Approximate Pages = 10 (250 words per page)