Native American Tribes in Casino Business
MGMT5003 Culture and Ethics in Business
Let’s narrow down the scope (what we mean by indigenous culture and business in this assessment task). We have deliberately made it broad to begin with!
You have three options as follows:
1. Indigenous businesses like the two examples below:
- Native American Tribes Venture Out Of Casino Business https://www.npr.org/2013/02/21/172630938/native-american-tribes-venture-out-of-casino-business (a good one to use, a solid example of an indigenous business);
- Strong sense of cultural identity drives boom in Māori business, https://www.sbs.com.au/nitv/article/2018/02/27/strong-sense-cultural-identity-drives-boom-maori-business
2. Indigenous programs (developed by non-indigenous businesses and corporations) in targeting at indigenous employment. Check out these videos:
- Indigenous Careers at Accor – What it’s really like https://www.youtube.com/watch?v=8D4Qu7unGjU
- Indigenous careers at the NRMA https://www.youtube.com/watch?v=nz0yUDdbmao
- Indigenous Careers at Westpac Group https://www.youtube.com/watch?v=q-_8HO_FxDw
3. Impact of business on indigenous rights and cultures:
- Adani coal port under threat of stop order amid concern for sacred sites https://www.theguardian.com/environment/2018/jun/28/adani-coal-port-under-threat-of-stop-order-amid-concern-for-sacred-sites?CMP=Share_iOSApp_Other
- The impact of business on ethnic minority groups in Myanmar (see under The Myanmar case (embedded in Module 10)
Therefore, the focus for this assessment should be on one of the three options as discussed above.
Native American Tribes Venture Out of Casino Business
Introduction
Every region in the world has indigenous people with diverse cultures, languages, and histories that define their ways of life. The indigenous people were once colonized by imperialists who sought to increase their territories, leading to a significant loss of lives, resources, and interference with economic activities and cultural practices and norms (Mankiller 2009). The communities faced systematic destruction of their social, cultural, and economic systems (Szczepzniec 2018). As a result, they continue to live in deplorable conditions characterized by extreme poverty, high level of unemployment, and increased mortality rate. Indigenous communities have taken radical measures to practice entrepreneurship to address their socio-economic needs (Wilson 2013). For example, indigenous casino businesses have been initiated in different states in the U.S. to boost socio-economic development and empowerment of the communities (Anderson and Dana 2007). The purpose of the report is to assess the essence of business diversification by Native American tribal casino businesses in the United States due to increased competition.Background of The Indigenous Businesses in The Casino Business Industry
The casino business has been a critical source of livelihood for most Native American tribes. It is approximated that half of the population depends on income from gaming services across the US. Tribes that own casinos have more improved standards of living. For example, the revenue from the gaming industry is used to improve recreational infrastructure, health facilities, and community infrastructure like schools (Oddo, Walkinshaw, and Jones-Smith 2019). The success of the Indian casinos in most states like Minnesota and Nevada has resulted from their monopoly. However, the federal and state have since developed stringent measures to govern this industry an eliminate monopoly.
Different non-indigenous companies have entered the lucrative casino business that was once considered the primary source of income for the native tribal communities. The indigenous casino businesses are under significant threats from stiff competition posed by non-Native casino businesses (Schaap 2010). As a result, most indigenous tribes are seeking opportunities to diversify their investments. For instance, a group of Native Americans sought to purchase 50 percent of hotel rooms in Minnesota to diversify their streams of income amid the increased competition in the casino business industry.
A major gaming company owned by the Indian indigenous community, Grand Casino Mille Lacs, has faced a significant loss of customers to close competitors (Ponting and Ponting 2016). However, the loss of business due to intense competition has been detrimental to the community’s economic growth. As a result, the company’s managers have been forced to rethink their business models to adopt diversification. For example, the Mille Lacs Band planned to acquire two hotels in Minnesota to diversify its business and continue generating revenue to the community. The Indian gaming company has been reinvesting the casino profits in the hotel industry to enable the Indian tribes to become economically secure. The proceeds from the new business ventures are to be used to improve infrastructures such as schools, clinics, and community centers that enhance the quality of life among the Native American tribes.Other indigenous tribes in the U.S. are also diversifying their investments to cushion them from the threatened revenue source in the casino business. Tribes such as Winnebago in Nebraska currently owns companies in different states and abroad through a holding company, Ho-Chunk Inc. (Wilson 2013). The firms use casino business revenue to invest in multiple businesses, including construction, marketing, and advertisements leading to improved income. A tribal Potawatomi Business Development Corporation formed in 2003 using proceeds from casino business in Milwaukee has increased its revenue potential through wise investments. The company aims at expanding the asset base of the Potawatomi tribe to cushion it from expected losses in revenue from the highly competitive casino business.
Literature Review
Cultural Theories
Hofstede Cultural Framework
The Hofstede cultural dimension theory introduces the nationalistic culture of collectivism and individualism. A society with a high individualism score is characterized by a low level of interpersonal association among the people (Agodzo 2015). Individuals in this society have limited responsibilities for the welfare of others through their actions and results. However, a collectivist society is characterized by an increased level of interpersonal relationships (McInerney and Ali 2013). Every member of a community is responsible for the welfare of others. They are expected to express their loyalty to the group by pursuing shared interests. Indigenous societies in America have a collectivist culture where individuals are interdependent in their groups.
Indigenous businesses are undertaken by members of the community who are seeking ways of improving the economic status of the native population. The enterprises are established through a collective approach to benefit indigenous people rather than meeting individual goals (Mrabure 2019). As a result, indigenous entrepreneurs are not self-oriented but engage in activities that will help the community. For instance, the indigenous American tribes are diversifying their investments from the casino proceeds to promote their economic sustainability.
Most indigenous casino companies are reinvesting income in lucrative sectors such as the hotel industry to raise more revenue for the community. As a result, the businesses are run from a collective approach with emphasis on meeting the long-term community goals, such as improvement in infrastructure (Wilson 2013). The Hofstede cultural dimension is critical in understanding the objectives of the indigenous community businesses. It shows how individuals within the community are interdependent.
Trompenaars Cultural Dimension Theory
The Trompenaars model offers different dimensions to the culture among communities and countries. The model provides communitarianism as an essential dimension that defines a society (Reis, Ferreira, and Santos 2011). Indigenous tribes have a high level of communitarianism because of people’s perception of the importance of groups. Members of a community seek ways of belonging to a group by showing their loyalty in exchange for support and safety.
The indigenous tribal American communities have shown a high level of communitarianism. For example, entrepreneurs seek alternative ways of diversifying investments to enhance the financial security of the society. The indigenous communities perceive non-native casino businesses as potential threats to their economic development. (Expert Program Management 2017). They strive to find ways of remaining economically prosperous as a community. There is a belief that the quality of life will be better when individuals support each other. The indigenous communities organize themselves in groups leading to a high sense of group cohesion.
Economic Dimension
Indigenous communities participate in business to achieve economic liberation. They aim at achieving socio-economic objectives of gaining greater control of their resources and achieving self-sufficiency (Anderson et al. 2008). The group has a history of historical injustices where government policies have not addressed their rising concerns. Thus, they participate in entrepreneurship as a means of generating income to support the welfare of every member.
Casino businesses are significant economic activities among the indigenous Americans in tribal regions. For instance, communities with casinos have improved health systems and quality of life. The proceeds from casino businesses are used to develop infrastructures such as schools and roads (Oddo, Walkinshaw, and Jones-Smith 2019). The Indian Gaming Regulatory Act passed in 1988 requires that revenue from the indigenous casino businesses should be used in tribal governance. The Act stipulates that casino incomes should be used for enhancing the welfare of members of the indigenous communities, financing the indigenous governments, and promoting economic development.
Diversification Strategy
Diversification is a significant growth opportunity for indigenous enterprises in the contemporary business environment. Diversified companies are expected to gain more returns compared with enterprises that do not change their business models (Verma, Sharma, and Kumar 2017). For instance, companies that adopt diversification strategies are expected to dominate the market, enhance profitability, and decrease business risks (Ravichandran and Bhaduri 2015). Diversification has a significant contribution to sustainability. Diversified businesses can adequately manage external business pressures, such as economic changes, competition, and cultural influences.It is estimated that over 459 tribal casinos owned by the indigenous communities registered a rapid decline in income because of increased competition from non-native casino businesses. Statistics presented by the National Indian Gaming Commission indicated a fall in revenue among the native casino firms after the opening of 24 new casino businesses. For example, there was a 2.5% decrease in casino revenue for tribal communities in Michigan since 2012-2014 after the establishment of 10 new casinos (Friess 2015). As a result, most corporate leaders in the casino business have raised concerns about the limited sustainability of casino businesses in different states. For instance, the managers of tribal Nottawaseppi Band casino have recognized the increased market competition and maturity in the Detroit casino business.
Recommendations
The market competition presents a growing threat to the dependency of indigenous communities on the casino business. Therefore, the tribal governments should use a significant portion of gaming income to diversify into other sectors of the economy, such as agriculture and manufacturing, to ensure sustainability (Friess 2015). The diversification will ensure income flows to the communities in the long term. The seed money should be reinvested in innovation and technology to make the community businesses competitive in the contemporary business environment.
Furthermore, the federal and state governments should initiate ways of protecting indigenous casinos from market competition. The tribal casinos have been the primary source of economic development for the native Indian communities. Thus, they should be protected from unfair competition posed by large non-indigenous firms. The government-created monopolies are likely to improve the sector performance for the benefit of the indigenous society (Thompson, Prentice, and Palace 2013). The state governments can pass legislation that prohibits the multiple licensing of casino businesses to promote the monopoly of the indigenous casinos. The monopoly status will pose a potential barrier to new entrants in the casino business, thus protecting the indigenous casinos from the market competition.
References
Agodzo, Divine. 2015. Six approaches to understanding national cultures: Hofstede’s cultural dimensions. Spring Arbor University.
Anderson, Robert, and Léo‐Paul Dana. 2007. “Indigenous Entrepreneurship as a Function of Cultural Perceptions of Opportunity.” International Handbook of Research on Indigenous Entrepreneurship. Edward Elgar: Cheltenham (U.K.): 249-258.
Anderson, Robert, S. MacAulay, Bob Kayseas, and K. Hindle. 2008. “Indigenous communities, entrepreneurship, and economic development in the new economy.” Non-market Entrepreneurship Interdisciplinary Approaches: 89-123.
Expert program management. 2017. “Trompenaars Cultural Dimensions – The 7 Dimensions of Culture.” Expert Program Management. https://expertprogrammanagement.com/2017/10/trompenaars-cultural-dimensions/.
Friess, Steve. 2015. “Indian Tribes Look Beyond Casinos for Income.” The New York Times. https://www.nytimes.com/2015/10/24/business/indian-tribes-look-beyond-casinos-for-income.html.
Mankiller, Wilma. 2020. “Being Indigenous in the 21st Century.” Cultural Survival. https://www.culturalsurvival.org/publications/cultural-survival-quarterly/being-indigenous-21st-century.
McInerney, Dennis M., and Jinnat Ali. 2013. “Indigenous motivational profiles: do they reflect collectivism? A cross-cultural analysis of similarities and differences between groups classified as individualist and collectivist cultures.” Indigenous Peoples: 211-232.
Mrabure, Ruth Omonigho. 2019. “Indigenous business success: a hybrid perspective.” Journal of Enterprising Communities: People and Places in the Global Economy: 3-6.
Oddo, Vanessa M., Lina Pinero Walkinshaw, and Jessica C. Jones-Smith. 2019. “Peer Reviewed: Casino Ownership and Health-Related Community Resources Among Native American Tribes in California.” Preventing Chronic Disease 16.
Ponting, Sandra Sun-Ah, Jess Ponting, and Katherine Spilde. 2016. “Identifying opportunities to inform and inspire: Tribal casino employee perceptions of tribal self-sufficiency and philanthropy.” UNLV Gaming Research & Review Journal 20(2): 85-104.
Ravichandran, Archana, and Saumitra Bhaduri. 2015. “Diversification and firm performance: A study of Indian manufacturing firms.” Munich Personal RePEc Archive: 1-27.
Reis, Nuno Rosa, Manuel Portugal Ferreira, and João Carvalho Santos. 2011. “The cultural models in international business research: A bibliometric study of I.B. journals.” Center of Research in International Business & Strategy: 1-31.
Schaap, James I. 2010. “The growth of the Native American gaming industry: What has the past provided, and what does the future hold?” American Indian Quarterly 34(3): 365-389.
Szczepzniec, Kristin. 2018. “Indigenous People of Western New York.” Cornell University ILR School: 1-23.
Thompson, William N., Catherine Prentice, and Caesars Palace. 2013. “Monopolies or Open Markets for Casino Industries?” UNLV Gaming Law Journal 4(1): 39-72.
Verma, Pratima, R. R. K. Sharma, and Vimal Kumar. 2017. “The sustainability issues of diversified firms in emerging economies context: A theoretical model and propositions.” International Journal of Process Management and Benchmarking 7(2): 224-248.
Wilson, Conrad. (2013). “Native American Tribes Venture Out of Casino Business.” NPR.org. https://www.npr.org/2013/02/21/172630938/native-american-tribes-venture-out-of-casino-business.