Harrah’s entertainment is reportedly close to accepting a $16.7 billion buyout from two private equity-firms.

Much of Harrah’s success (it has outperformed its competitors consistently over the past ten years), is due to its adept use of business intelligence.

Harrah’s competes by deploying technology and the new business intelligence in an industry that traditionally depends on instinct. Competing casinos rely on the perceptiveness (and whims) of pit bosses to grant customer premiums (such as hotel rooms, show tickets, gaming chips). Harrah’s loyalty program is based on decision science. Even the hiring of Loveman, an academic without any gaming industry experience, differs from the typical “work your way from the bottom” Las Vegas career path.

Harrah’s executives felt that return on investments in lavish entertainment palaces would dwindle when the next batch of hotels opened. Rather than splashy entertainment centers, Harrah’s focused on a streamlined, standardized operation designed to create outstanding customer service across a wide geographic area.

Harrah’s Total Rewards is similar to a frequent flyer program. Guests collect points on smart cards. Data on game play, win/loss rates, hours of play, and the like are combined with demographic information to provide a detailed profile of each guest’s activities and preferences. In 2000, Harrah’s estimated that 26% of players provided 82% of its revenues; with the average player spending about $2,000 annually, typically in multiple locations Gary Loveman comments (in Fast Company), “Some people like to demean us by saying we’re the Wal-Mart of gaming. I love that. If I can be the Wal-Mart of gaming, I will feel that I’ve done extremely well for my shareholders.”