HARRAH'S ENTERTAINMENT, INC.: STRATEGIC AUDIT
This paper presents the findings of a strategic audit of Harrah's Entertainment, Inc. The findings of the strategic audit cover the following topic: (a) background information on the company; (b) external analysis of the environment; (c) internal analysis of the company; (d) analysis of company strategies; (e) analysis of organizational structure and control systems; (f) analysis of the company's past performance; and (g) predicted future performance of the company for 2004-2006.
Background Information on the Company
Harrah's Entertainment, Inc. is the world's third-largest gambling company. Harrah's owns, operates, or manages 25 casinos under the Harrah's, Harveys, Players, Showboat, and Rio brands in the United States. The company's operations include casino hotels, dockside casinos, riverboat casinos, and Indian gambling enterprises ("Harrah's Entertainment, Inc. Overview", 2004).
One important and effective strategy followed by Harrah's Entertainment is the company's customer rewards program รน Total Rewards. The conventional growth strategy in the casino segment of the gambling industry is to build ever newer and bigger casinos. The conventional strategy is capital intensive and somewhat risky. Harrah's Entertainment developed the Total Rewards program from a retail perspective to encourage growth at existing facilities. The heart of the strategy is a data mining operation operated by Cognos that locates, sifts, and analyzes customer data to learn what customers want, to provide what customers want through a combination of rewards and new services, and to follow through with customers to assure their satisfaction. The strategy has enabled Harrah's Entertainment to achieve an average 14 percent year-to-year gains at the company's existing facilities.
Harrah's Entertainment, however, also pursues an acquisition strategy when opportunities arise. In 2004, the comp...