Las Vegas Sands Corporation is the USA based resort and one of the best service providers of accommodation, restaurant and exhibition and also largest convention facility owned privately. It is also famous for its charitable activities and environmental programs. The business was founded in the 1970s by Adelson and got its name Las Vegas Sands Corp in 2004. The main objective of this paper is to discuss the foundation and development of the Las Vegas Sands Corporation.
1) The Mission/Vision Statement
Las Vegas Sands Corp. (NYSE: LVS) is the leading global developer of destination properties (integrated resorts) that feature premium accommodations, world-class gaming and entertainment, convention and exhibition facilities, celebrity chef restaurants, and many other amenities. (Sands.com)
a) Items Missing in the Mission/Vision Statement
The vision statement is not clear, since it lacks the main idea that is meant to create a big picture in the minds of community in the corporation. The vision also lacks proper timing. A vision does not refer to what is already achieved but that which cannot yet be seen or existing but that which is to be achieved after sometime of investment. The current mission/vision statement only points to what the corporation currently owned. On the other hand, the mission statement is void of the elements that define it. Since the mission statement is meant to describe how the vision is to be achieved, the statement should begin with “To”. It is also missing the vision which is to be achieved by the fulfillment of this mission. Lastly, the existing statement does not identify the core values to be upheld in the course of working to achieve the mission and vision of the corporation.
b) The Most Effective Elements
These are factors that are building blocks of the of the mission/vision statements. A properly stated vision statement should contain a vision which is precisely the reason why the business was set up. Therefore, there is no mental picture created by the existing mission/vision statement on what is to be accomplished by the corporation. The idea which must be stated in a precise manner is responsible for the creation of the mental picture. The activities of the people are automatically chandelled to achieve the vision when they focus on this big idea.
On the other hand, the mission statement should contain three most effective elements. The core values are also principles and principles are very important to enable the leaders to maintain high level of discipline and integrity, befitting their responsibility. Thus, they will have limits and boundaries within which they will carry out their activities which will facilitate accomplishment of the vision and mission. Such core values include protection, respect of environment and high ethical standards and economically sound business. Also, vision is an effective element in mission statement for it is the reason for the mission to achieve it. It is the standard against which progress and performance are continuously evaluated and rated. A mission is also an effective element, for it provides direction on what is to done in each step to achieve the intended vision (Hofstrand).
c) Shortcomings of the Mission/Vision Statements
The corporation does not ideally have a vision or a mission and the danger lies on its inability to tap all its potential energy and opportunities to achieve more and also avoid many stabling block that may arise from lack of the effective elements of the mission statement.
d) Changes Expected
The vision statement should show us that the corporation believes in proving a safe environment and looking forward to becoming the global preeminent sustainable resort. For a mission statement, Las Vegas Sands Corporation is firmly committed to developing practices that would champion protection of natural resources; therefore, provide a safe and healthy working environment for its team workers. This is to ensure that the experience of the guests on the resort is enhanced and also the quality of life of the communities on the neighborhood which the corporation operates has improved. It is the leading integrated resorts developer of destination properties in the world which is specialized in provision of world class gaming and entertainment, celebrity chef restaurants, convention and exhibition facilities, premium accommodation, just to name a few.
However, even with the existing faulty mission/vision statement, the corporation is deemed successful. The creation of a sustainable development program such as SANDSEco360 gives the corporation a competitive advantage over its rivals, such as Wynn Resorts, which is also ranked to be one of the best hotels in the globe. Las Vegas Sands Corp does this by the incorporation of this program into all their properties in the whole world. One of the brief achievements of the mission is Leadership in Energy and Environmental Design (LEED), which is an internationally accepted benchmark in high performance green building as well as design and construction (Sands Eco 360 Global Sustainability). This means that it has been able to use the strategies of designing buildings and communities in a manner aimed at performance improvement such as saving energy, efficient water use and also better stewardship and environmental quality of resorts.
2) Las Vegas Sands Corporation Strategies
One of the strategies of winning an upper hand in the community over other competitors, the corporation engages in various strategies. The firm is a committed partner in community development through the funds it receives from other companies and donations from employees who do so through Sands Foundation, a non–profit organization. Through numerous philanthropic activities which are possible under the tax exempt laws. Many underprivileged communities have been supported and empowered through promoting health as well as expansion of educational opportunities, especially to the youth.
Adelson and his partners decided to be promoting the conventional meetings as well as the trade shoe industry, while other hotels such as Wynn Resorts concentrated on gambling. The chosen endeavors of Las Vegas Sand were a way of presenting a new opinion to the guests that hotels were not only about gambling but also for holding various meetings and conventions. In this strategy, hotel rooms were converted into luxury suites in which there was comfortable workspace. The strategy led to increased occupancy, especially in the midweek (Sands.com).
The positioning of their business in the Asian market before a move by the American competitors to establish their companies there was a great strategy seen as a potential expansion by the Las Vegas Sands Corp. Macau, for instance, which was a given back to China by the Portuguese in 1999, was the only place where gambling was legal in the whole mainland China. As such, billions of people flocked here daily. To solve the looming crisis a casino similar to the “Las Vegas Strip” was built which brought to life the Sands Macau to life and Venetian Macao Resort Hotel to life.
The enterprise of Adelson continued expanding despite his company facing financial difficulty in 2010. He achieved this by Marina Bay Sands found in Singapore by investing $5.6 billion into this project (Sands.com). This park serves as the main attraction resort for business travelers and locals by displaying a unique feature of the Sands Sky Park which is set at the top of three towers. In addition, the park presents serene environment with a lush vegetation, several restaurants, observation deck and swimming pool. Once again this strategy paid off and became the most successful and profitable investment so far, taking advantage of existence of only one competitor in Singapore.
The company identified most of the customers to be those attending conventions and those inclined to gambling such as tourists.
Casino Mogul Sheldon Adelson is making a new venture of heading to Barcelona as its location and also launching a massive strip style casino resort in Europe. There are also other expansions, which are about to be established in Japan, Taiwan India Korea and Vietnam. Meanwhile, the company continues to expand in the U.S.
The gambling game industry in Macau’s casino grew out of control and soon there were negative reports about the entire social corporate. It must have been associated with committing crimes loss of social contact and in case of excessive gambling it leads to bankruptcy. Therefore, social responsibility must be embraced in all ways, and this has to begin with Macau operators, local operators, governments and gamblers. All these parties take effective by making sure that there is sanity in the business. Responsible game is an investment for the future gaming industry in Macau’s casino.
Barrier to Entry
Barrier into the casino business will help to regulate unnecessary competition in the casino industry. This is done through placing a requirement for the legislative approval of gaming licenses, as well as for the land for building casino resorts. Following high regulations on the industry as well as high taxation, there must be a check on the civil and legal background, financial, educational and litigation officer.
This will ensure that the industry has only positive competition and hence is an advantage to already established companies such as Las Sands or Macau. Finally, the casino business requires very high capital to support which is not less than a certain amount of millions.
Threats of Substitutes
Some betting games attract large amounts of winnings such as in the state lotteries, which only require a very small amount of input such as $1 per ticket. There is also the internet poker, black jack, roulette and others that are alternative pathological gamblers. This kind of erupting alternative gamblers is a challenge to companies such as Las Vegas Sands causing a decline of profits since they also depend on its large influx of customers.
There are many challenges facing the casino as well as resort industries, for instance, Las Vegas market competes directly with Atlantic City and Native American Reservations which are smaller establishments. With further delay in the recovery of economy, people are likely to flock to casinos with lower entry money and time to get the win they want (Sands.com).
Also, there are those industries with equal power and size as the Las Vegas, which, however, have few firms but mount strong rivalries. For instance, the Marina Bay Sands in Singapore is faced with competition from two strong industries.
The company is said to have a successful track record of being in a position to secure major development opportunities in foreign sectors. After the company recovered from the recent recession, LVS now has enough strength especially booming revenue from Macau that can be used to invest in future projects. CEO Sheldon Adelson is already negotiating plans on developing a billion dollar complex in Spain, Barcelona. This way, jobs can be created in foreign lands.
Retirees’ High Earning Level
The famous baby boomer generation starts to retire (from last year, 2011) and statistics indicate that by 2030, about 18% of them will be retired. This means that there is a big opportunity for the gaming industry in various ways such as: they are typically big spenders, they have more leisure time, they have good amount of disposable income and they represent an important segment that of the targeted market.
Restrictions on Internet Gambling
According to the online gaming instructions, there have been efforts aimed at slowing down the growth of an internet gambling due to increased credit card money transfer fees. This means that there will be increased revenue for casino resorts like LVS as online gamblers have no choice, but to find alternative routes.
There have been reports that LVS was recently being investigated for breach of Foreign Corrupt Practice Act in Macau. Since the bribery allegations leave officials to question how LVS has been conducting its business and even whether it has a clean reflection of its financial reporting. There are reports also that connecting Adelson to political support as he was said to have financed the GOP to a tune of $100 million.
Government Regulations and Policies
Different countries have different regulations on how foreign businesses can conduct their trade. For example, Macau has regulated on the number of visas to mainland Chinese visitors as well as restricting the use of credit card spending.
Low Occupancy Rate
This is from the recession impact. LVS is a leisure resort type of business and customer will most likely spend when they have plenty, thus when recession bites, resorts like LVS will feel its effects most.
Strong Liquidity Position
LVS liquidity has been above average for a long time now when compared to its industry. Moreover, the company has enough amounts of cash on their books and this is considered a successful track record. In the year 2012, the company reported cash flow of $2,2 billion from the Macau, US and Singapore subsidiaries.
Strong Market Position
The LVS Company is the biggest in its industry with a market capitalization of 35,1 billion. The expansion will allow LVS to become more progressive and to capture a growing population of middle class customers.
Experienced Management Team
Through the operations in Singapore and Macau, the company has gained knowledge among its competitors. The company as a result is committed to recruiting, employing, and training people of all ages in spite of their affiliations.
Increased Debt Financing
The company incurred large debts during recession that was seen to have brought problems of obtaining funds for further developments. LVS is said to have liabilities in the excess of $14,39 billion with a long-term debt of about $9,58 billion (iStock Analyst).
LVS has one of the best properties in the world, but is restricted in its trade, because it is just but a gaming market. LVS should take cue from other resorts like Wynn and set up other luxury resorts like golf courses, or marine parks to give customers a variety of attractions.
The company has a history of lawsuits that has been of great concern to its management. Furthermore, investigations involving bribery in Macau reflects a rise of its current liabilities.
Horizontal Integration Strategy
LVS utilizes its strong liquidity position, large market, and knowledge of the Asian market by buying smaller firms (like Zynga, maker of Farmville) without the use of real money. By this strategy, the firm gains more monopolistic characteristics without necessary attracting the attention from the government.
Product Development Strategy
As the economy recovers, LVS needs to adjust its services and reflect customer needs. By use of the product development strategy, LVS can offer better deals to its customers during the time when casinos experience low demand.
The aim of this strategy is to refrain from any of the suspicion of some of the allegations including bribery, money laundering, and falsifying its accounts. This is seen as a defensive strategy used to eliminate threats.