Implementing Lean Operations at Caesars Casinos

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One of the main tools used almost universally in LEAN operations is the Kaizen event. Kaizen means “continuous improvement.” “A kaizen event is a focused analysis of a particular activity or set of activities to discover ways to improve efficiency and effectiveness in meeting customer needs.” (Pesch, 2016) A Kaizen event typically extends several days in duration. The Kaizen is almost like the Master Tool in which several other tools are utilized during the Kaizen event.

Many of the subset of tools intertwine with one another and may help the different segments of using the tools. In LEAN terms, for example a Gemba walk may lend itself to utilizing a Spaghetti diagram. A Gemba Walk is when “the LEAN team visits the physical site and studies/takes notes on the activities at the site.” (Pesch, 2016) “Value - added and non-value-added activities (waste, delays, duplication, etc.) can be observed during the walk.” (Pesch, 2016)

A Spaghetti Diagram developed and utilized as part of the Gemba Walk often leads to pinpointing wasted travel. “A team member uses a copy of the area layout and draws a line that follows a product or person through the facility from beginning to end.”(Pesch, 2016) By doing so, one can more readily see where duplication of movement might be eliminated and thereby improve process by eliminating waste.

Harrah’s also utilized ‘try-storming’. While there has been questioning by some outside of LEAN as to the difference between brainstorming and try-storming, we tend to believe they are very distinct differences between the two. Brainstorming may stop at tossing out ideas. Try-storming, by contrast, may actually try and develop quick, perhaps model scale or mini work areas, to actually implement the suggested solutions. These mini experimental trial solutions may help finding larger problems the solution might create if fully implemented as well as truly develop the best techniques suggested by the team.

Finally, we would be remiss if we did not introduce the 5S concept. For LEAN, the Japanese 5S words do not translate exactly into English but the concepts are maintained using 5 similar S words for concepts. These are:

- Sort: “If in doubt, throw it out”. By sifting through all of the accumulated materials, keeping only what is necessary and discarding the rest, waste is eliminated.

- Set in Order: “A place for everything, everything in its place.” Make all work areas neat, orderly, and labeled in such a manner that a stranger could come to work and know where things go or where to get supplies.

- Shine: Clean everything and make sure all areas are supplied and in working order.

- Standardize: Create and enforce policies to make the 5S’s a daily practice.

- Sustain: Memorialize or institutionalize the above 4S’s. “Training, communication, ongoing measurement, and promotion of 5S are essential building blocks of Sustain.” (Pesch, 2016 for #’s1-5)

Hirsch’s management team recognized the great strides in value added customer service that came about from using the LEAN process. They also realized that sustaining the improvements and keeping the staff from reverting back to what they knew and were accustomed to would take continued effort. Harrah’s built a sustaining culture using 3 pillars of LEAN culture.

- Standard work is when Kaizen events develop routine work activities, write them up and explain or train people how to continue the new way of doing things.

- Key Performance Indicators are a way to continuously assess the improvement in order to make sure the solution is working.

- Daily problem solving may be Gemba walks in combination with Executive Engagement so that everyone knows LEAN is the goal from the top down.

There should be no doubt that Caesar’s Entertainment was pleased with the work previously done by Hirsch and they were looking for him to replicate that work in Metropolis.

RECOMMENDATIONS:

We believe that Hirsch and his suggested group of “highly skilled process-excellence experts” can achieve the goal addressed in the problem statement. Hirsch has a proven track record of success and experience that will assist him in identifying previously recognized trouble areas and solutions. The assistance of the experts will also help them to have multiple skill sets and solutions that can be transferred from prior experience to the new facility.

One place we do find fault, however, is that the implementation of previously proven performance enhancements are not mentioned as already being implemented. It’s true that the Metropolis location may have differences from the Tunica facilities, but this shouldn’t negate inclusion of those best practices being implemented from day one at the new location.

Even if they have utilized many of their previous improvements, LEAN will still need to be worked through numerous times for several reasons. First, the new facility will have new obstacles that need to be addressed. Second, and perhaps most importantly, to overcome resistance from current employees they will need to have some involvement in the process. In order for employees to take ownership of the LEAN way and the solutions that come from it, they must be engaged in the process and understand it as well as feel as if they are valued team members contributing to the betterment of customer service and elimination of waste.

DISCUSSION AND ANALYSIS

We are fairly confident that the plan initially suggested by Hirsch and recommended by us is the best course of action to take at Metropolis. Caesars’s is no longer semi-monopolistic for gaming and must provide value-added service for their customers. Using LEAN has worked for them in the past and they can utilize their experience and previous successes to get a head start on addressing many issues.

Having said that, however, we believe there is a risk in not going into a full LEAN program like was used in Tunica. Employee participation leads to buying into the program and the solutions. Being part of the solution gives everyone a feeling of ownership and a greater willingness to internalize the solutions rather than resist them. When we talk about customer service, there is no greater asset, or liability, than the frontline employee. They have the ability to make the company great in the customer’s eyes or sabotage all the previous foundational customer service work in an instant. It is imperative, we believe, that not only should there be customer assessment, but there should