1. RRC operates as a single firm quite simply to provide better service to their guests. Big Horseshoe Slots, Nell’s Loung and Grill, and Sunnyside Motel operate as three separate firms, and as stated in the case study, serve a lower class clientele. By operating as one unit, RRC can provide cross-services to their guests with one stop, as opposed to having them take the time to coordinate their stay in three separate locations.
There are however, some important keys to success that RRC needs to achieve their goal of providing the best service to a high class clientele. First, they must have one focal goal that they all agree to and abide by, customer service being the top priority. Secondly, it is important for the management team to have synergy, without it, internal conflict and varying opinions could prove to be detrimental to their success.
Finally, RRC should look for ways to continually improve by soliciting feedback from their gusts. The weighted average cost of capital is in my opinion fair, and provides an easier accounting method for RRC. If these costs were varied, where hotel would pay a higher percentage, and entertainment a lesser percentage, the sum of its parts would still have the same outcome, and as RRC rolls up to one total profit center as a whole of its parts, this method makes sense and should prove successful for RRC. 2.
While RRC operates as a single firm with three divisions, for it’s accounting and administrative structure, it is in my opinion that they should roll up into one overall structure on an organizational chart. For example, payroll can operate as one entity to save capital; however, each division should have its own payroll administrator to assist employee’s with their unique needs across each individual division, these three individuals should report up to one payroll director who has a better overall understanding of RRC, while maintaining knowledge of the three divisions separately.
Accounting, HR, and management itself should also operating on a similar roll up into one overall RRC leadership team, with each division having supervisors to manage each firms unique needs. This is especially true for accounting, the financial interior kings of each division would certainly need their own team to focus on them as individuals as the inter workings of financial reporting will vary from entertainment to hotel to gaming; however, they should still roll up to one central reporting packet for the shareholders to review.