Harrahs Entertainment Case Study Analysis


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Background and Facts

Harrahs Entertainment an office supplies seller for little and moderate sized businesses has lately been associated with planning for a merger with its competitor Home Deport, which has actually influenced performance levels in departmentswith the elderly manager involved in legal problems put forth by the federal Trade Compensation. With the Marketing Head advancing the information of his departure from the firm in one year, Jeannie Lewis, the present head of operations has been asked to take the function in the future. With difficulties in the type of a prospective cultural change and low staff member spirits, the company needs a complete reengineering initiative at the advertising division.

Problem Statement
Porter's 5 Forces Analysis
The possible social adjustment at the advertising and marketing division of Harrahs Entertainment is enhancing unpredictability in the workplace leading to various challenges for the Jeannie Lewis who would certainly be changing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a major role in influencing calculated decisions since Stapes Inc. had to abandon its strategies of merging with Workplace Deport after the Federal Profession Compensation's intervention in the process. Given the fact that the store has an international existence with branches in UK, USA, Canada and also Germany, political factors in each of these nations might be able to impact performance or critical goals. Federal Profession Compensation's antitrust suit versus the merger occupied beneficial time of the company's senior monitoring recommending that 'political' factors can have major effects for a global business.

Economic Factors: Financial factors such as the development of small companies in the global situation recommend that Harrahs Entertainment is flourishing in a setting where there is possible development of services. Along with this, truth that shop consumers are primarily trying to find office supplies for home offices suggests that the market has a rising pattern of business owners as well as home based businesses.

Social factors: Social fads in the economic situation show that consumers are looking for comfort as well as appealing prices. Market research demonstrates how the customer for Harrahs Entertainment lacks awareness concerning discovering services which can provide a mix of benefit and affordable.

Technical factors: Innovation plays a crucial role in Harrahs Entertainment's service strategy particularly as the company is piloting Modern technology facilities which would certainly offer technology sales and also support in the kind of memory upgrades, peripheral installations. (Summary of PEST in appendix 2).

OB Issues and also Effects.

A number of underlying Organizational Habits concerns can be seen in Harrahs Entertainment's case as highlighted in this section.

Uneasiness regarding social modification: There is concern regarding a cultural adjustment that would take place when Todd Krasnow leaves from his setting as the Exec Vice President of Advertising with most of the personnel currently showing discontent over this potential step. This expected modification has produced stress and anxiety in the workplace which has actually been combined with the past tension of preparing the company for a possible merging with Home Deport.
Pest Analysis
Demanding Job Setting for Newcomers: There is scarcity of employees that can match the stressful environment of a fast-paced organization. Not just does this result in problem in locating the ideal individuals, it puts tension on brand-new hires as can not withstand the rate as well as stress that the organization anticipates them to birth.

Dual Coverage Lines: Novices find this business society troublesome and difficult to deal with especially as populated line connections are implied to be weaker as a whole as well as unbiased setting and performance examination is still done by the strong line manager. This indicates that novices can shed clarity regarding their respective functions as well as objectives specifically as populated line coverage does not keep them in straight communication with the strong line supervisors.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor as opposed to Bridget Coles despite the fact that it had actually been hypothesized that the latter would certainly take Krasnow's placement came as a blow to her morale. Lewis may have been qualified and proper for the work however the reality that Kransnow's separation would certainly make Coles a straight report to Lewis may have been the factor for Coles' resignation from solutions.

Anxiety & Work Insecurity: Fear and also instability can be determined as two major concerns that Lewis would certainly be managing particularly as the merger has actually now be terminated as well as two elderly execs of the advertising division would be leaving. The entire responsibility of the department would be falling on Lewis's shoulders who would not just be in charge of brining concerning a cultural adjustment yet would also have to prove herself in her new role.

Incompatible Administration Style of Leader: Lewis's monitoring design and its conflict with the marketing division's function can likewise be seen as an OB obstacle especially as she has actually been utilized to dealing with issues in the procedures division where workers are taught to concentrate on processes and obtain them. The marketing department on the various other hand can be viewed as a group of people who are used to being nurtured by Krasnow that concentrated more on outcome than procedures.

Interdepartmental Differences: Interdepartmental arguments in between 3 departments, advertising, merchandizing and procedures respectively over the allowance of the advertising and marketing mix can be identified as one more OB problem. Although the marketing division does not share the very same vision as the various other two divisions pertaining to the aloocation of the advertising mix twoards promotions and also advertsing, the merchandizing as well as procedures divisions do not agree over the advertising mix appropriation among each other either.

Disintegration in Advertising Department: Disintegration in between the marketing and advertising divisions can be recognized as another OB concern which could need additional interest. The reality that the marketing and advertising sections in the advertising and marketing division are disconnected is preventing both divisions from getting from each various other's experience and know-how. Combination of advertising and marketing with merchandising and operations would come to be more difficult if the advertising division itself is degenerated which can be another prospective OB concern.

Harrahs Entertainment Analysis

Different theories have actually been utilized to describe the scenarios to obtain additional clarity about the scenario at hand.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, many managers think that staffs are passive and careless, have little aspiration and also withstand modification. The difficult version of this theory stressed threat, tight controls, risks and also punishments. With time it generates low productivity, subtle sabotage and also rivalry (Offer, 2003). The circumstance at Harrahs Entertainment is not entirely following Theory X, it can be seen that new hires are locating this setting instead difficult which may eventually lead to a better inclination of the management towards Concept X. Based on McGregor's advocated view, which he called Concept Y, the necessary job of the monitoring is to set up business problems to make sure that people can attain their very own goals best by directing their initiatives in the direction of business benefits. If individuals discover no complete satisfaction in their work, the monitoring would certainly have little selection but to rely on concept X and also outside control (Offer, 2003). Even while examining Lewis's monitoring design, concept X might have been suitable in the procedures department to some extent yet the Advertising department would certainly call for dependence on Theory Y to get the imagination and also originality from the groups.

Tuckman's Synergy Theory: As far as Lewis's problem about bringing harmony between the marketing and advertising department is concerned, this would initially lead to contrast as talked about by Bruce Tuckman in his 'Synergy Theory'. (Tuckman, 1965). Based on Tuckman's concept displayed in appendix 3, during the first stage of group development, individuals might not bond, as they are active finding their place in the group. By combining the marketing and advertising division's job, there might coincide first detach which might lead to the second phase of 'storming' where the teams test one another. Nonetheless, it is only during the 3rd phase or 'norming' when they would certainly collaborate to share ideas before the team can cause harmony in the 4th stage 'performing'.

Bridges' Change Version: As per William Bridge's theory (appendix 4), individuals are quite uncomfortable with change, which is evident by the situation at Harrahs Entertainment The scenario can be seen as a regular training course of life if is researched based on Bridge's theory where he describes that individuals experience 3 phases of shift when they experience change. 'Ending, losing and Letting go', The Neutral Zone as well as 'The New Beginning' (Bridges, 2004). When individuals exist with change, they go into phase one and so there may be emotions like unhappiness, uncertainty, irritation, anger, worry, rejection as well as disorientation.The circumstance at the advertising department of Harrahs Entertainment is comparable so Lewis can get comfortable with the suggestion that it is not amazing behavior. In the second phase, there may be a demand to connect the void between the new and also old society so Lewis might have to encounter this experience as soon as Krasnow leaves. There might be low morale and also low efficiency at this phase which ought to not be taken as a setback. It is during this phase that Lewis will have to provide support to the department to ensure that they can discover an orientation. It can be seen exactly how Krasnow has already made this transition easier by making Lewis obtain associated with the department a year prior to his actual departure. Based on Bridges' Model, phase 3 will bring about visibility to learning, High energy and also commitment as people will certainly welcome the modification (Bridges, 2004).
Vrio Analysis
Abraham Maslow in his Theory of 'Demands Pecking order' (appendix 5) has talks about the relevance of 'safety needs as being a lower degree demand of a human for triggering motivation. As seen in the pyramid shared in appendix 3, we can see how 'the need to really feel safe and out of danger' is at the second degree of requirements. Prior to an employee can be made to develop psychologically, he requires to have his 'Physiological 'as well as 'Security' needs satisfied.

SWOT Analysis for Harrahs Entertainment Case Study

Effects of Analysis.

The OB analysis has actually checked out various theories to recognize just how to deal with the current circumstance available. The following three alternatives have actually been suggested to help Lewis handle the organizational obstacles in the marketing division. Each of these choices has actually been recommended for alleviating the change required to bring the marketing division according to the needs of the market as well as for making the cultural modification that would certainly comply with as soon as the current leader leaves.

Combination of marketing and advertising features. Separating Adverting and Manufacturing features. Combination of Advertising with Procedures.

Examination of Alternatives.

Combination of Advertising & Advertising And Marketing Functions: The internal advertising company of Harrahs Entertainment is currently toughness for the company in terms of saving up on expenses associated with advertising and promotion. Given that no brand-new recruitment has actually been done after Bridget Cole's departure with the coverage line being straight designated to Krasnow for the advertising feature, this is a beneficial opportunity for incorporating the advertising and marketing features. Judith Shapiro that has earlier been interviewed by Lewis during the earlier merging days has know-how in business-to-business advertising and marketing together with agency and retail advertising experience. When Krasnow leaves, Lewis can work with Shapiro as an EVP for advertising to manage both marketing and advertising features.

The advantage of this strategy is that it will incorporate the two features while reducing the demand for employing an extra resource for advertising. In addition to this, Lewis would certainly be heading the advertising and marketing division and also all the same her replacement would certainly be required for the current role that she is executing. The negative aspect of this choice is that outside hiring may bring about bitterness from interior personnel who may be looking at the position of EVP after Lewis takes control of Krasnow's setting.

Separating Adverting as well as Production: Provided the competitive pressures as well as high quality job required from the advertising agency, it is advised that Lewis should allow the production system to be a separate feature from the advertising device. Because most advertising agencies had these 2 functions as different devices, it makes even more sense to comply with the norm. Both features might be able to concentrate on their core turns on more successfully. The negative aspect of this technique would be that additional expenses would have to be borne for setting up different manufacturing functions. A manufacturing head may have to be worked with which might boost expenses for the organization.

Assimilation of Advertising And Marketing with Operations: Given that Lewis is already looking after the advertising and operations divisions concurrently; it makes sense to integrate the two functions given that she has been successfully dealing with both ends. The truth that both departments currently have major differences over allocation of sources suggests that this integration might have the ability to cause consistency especially as Lewis would be heading both ends.However there are different drawbacks of this move especially as it would certainly put too much burden over Lewis's shoulders. The fact that Lewis has to adapt her management style for the marketing division suggests that these 2 divisions would certainly be culturally varied. In addition to this, Lewis may not be able to apply one kind of leadership design to both departments which could cause inadequacy in either among the two features.


An evaluation of the three options suggests that assimilation of marketing as well as operations would certainly not be a viable step due to the large distinctions in between the two departments despite the reality that currently Lewis is taking care of both. While splitting up of the manufacturing feature may have been a positive action for the advertising division, the reality that it would indicate positioning a 3rd function under Lewis's wing indicates this ought to be avoided.

Action Plan.
Lewis will certainly take control of the role of EVP Advertising after Krasnow leaves.

Advertising and Marketing features would be combined.

Judith Shapiro will be worked with to take Lewis's location as SVP of marketing and advertising.

Manufacturing function will remain component of marketing under marketing feature.

Lewis will divide herself from operations.

A democratic management style with employee empowerment will be used in advertising and marketing division.

Open door policy and focus on cross department communication will certainly be targeted at eliminating dissonance.

Backup strategy.

If the combination does not exercise as planned, a backup strategy would comply with which would divide the manufacturing feature from the advertising and marketing feature to decrease the lots on the SVP of advertising and marketing. In case Judith Shapiro does not get worked with, Lewis will be heading the marketing department without an SVP. In that case the production function will certainly be divided by putting it under an SVP manufacturing.