Controls at the Bellagio Casino Resort

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Synopsis of the Situation The Bellagio was one of 23 properties of MGM MIRAGE, one of the world's leading hotel and gaming companies. Located in the heart of Las Vegas, The Bellagio was widely recognized as one of the premiere casino resorts in the world. Richly decorated, the resort featured a conservancy filled with unique botanical displays, and eight-acre lake featuring over 1,000 fountains that performed a choreographed ballet of water, music, and lights, top-notch amenities and entertainment options, and 200,000 square feet of convention space. In the casino operations area, the Bellagio operated 2,409 coin-operated gaming devices (slot machines), and 143 game tables. Approximately 1,000 people were employed in casino operations. As in most companies in this industry, the gaming (casino) and nongaming operations were run as separate profit centers. The unique feature of a casino resort organization, as compared to that in most organizations, is the relatively large size of the finance staff. In the Bellagio, about 1,000 of the total of approximately 4,000 employees were in the finance organization Key Issues Organizations can supplement or replace results controls with other forms of controls that serve the sames purpose: make it more likely that employ ees will act in the organization's best interest. The management control systems used by the Bellagio Casino Resort represent a control system that is dominated by action and personal controls, rather than result controls. While the managers interviewed for the case may seem justified in being proud of their company's control system, one needs to keep in mind that managers are not going to be apt to openly admit to weaknesses when these interviews may be read by their competitors, government regulators, or simply a slick gambler. Controls Action controls (involve ensuring that employees perform (do not perform) certain actions known to be beneficial (harmful) to the organization): Physical --Strict...
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