Disneyland Paris Case Study Analysis
This unique image Walt Disney portrayed and provided for the customers at Disneyland Resorts and parks have a highly controlled management systems and an ethnocentric style, to deliver the a high grade of service and product, which is part of their core competencies, for their competitive advantage. Disney’s entry strategy to France was also centred on control. Euro Disney had entered France using their organisational culture some variations to adapt to the French cultural mannerisms. Although both countries are westernised they both have very different national cultures. 4)
Mead (2005) stated that when a subsidiary is located in a different country the need to coordinate the organisational aims and direction, is high, if it is centralise. This is because in different countries the likelihood of becoming disengaged with the headquarters is high. Euro Disney follows a dependent subsidiary as the management team hired to control Euro Disney under direction of Walt Disney. The decisions made were central to Walt Disney to coordinate the hospitality and services. An example of the measures taken, were the creation of handbooks that gave strict instructions of the code of conduct and the rigorous standards.
This direct mechanism system for control, provided clear expectations, and what was expected of. Furthermore training was provided to give basic knowledge and behaviours to staff while employed to Disney. Although this was appropriate for Disney USA the French may not find it as useful. Hoelick (1995) suggested that French culture is acute to the implicit nature. Consequently, French nationals may take offence to the basic structure of requirements and think the Americans believe they incompetent. Furthermore it doesn’t address the practical issue that may occur, during work.
Another Direct mechanism Euro Disney used was the opening of the Euro Disney Branch of Disney University, which further trained workers, via the use of indirect mechanisms. Walt Disney coordinates all theme parks to have a high level of homogeneity. Coordination was very important factor to implement. The way Disney attempted this was by focusing on Sales, attendance rates and financial performance and out put data, which indicated the use of indirect coordination Mechanisms. Euro Disney accommodated the rates of inflation as the external environment influences. Direct control mechanisms are proactive in controlling and coordinating.
Egelhoff (1986) found this is a common process used by American businesses, through a study conducted. More Americans subsidiaries where found to report using quantitative data. Furthermore, Europeans where found to use direct mechanisms of coordination of which was mostly qualitative data. An example of this is having appropriate training or meetings with employees for first hand issues within the subsidiary. These mechanisms anticipate risk and reduce the likelihood of it occurring. This method is focused on an individual subsidiary’s needs consequently making it highly difficult to compare and contest with another.
Euro Disney management are likely used the indirect method for ease of comparison with headquarters and other subsidises however this may have produced an inaccurate and distorted presentation of Euro Disney. Deresky (2011) stated that indirect Mechanisms do not account for economic factors of inflation, which is beyond internal control. On many occasions Euro Disney projected losses however, it is possible that the indirect method of coordinating control failed to show Euro Disneyland management may have increased it long-term stability and profitability.
In a nation where direct methods are commonly used, external variables are a significant factor, especially in the case of Euro Disneyland. Furthermore to achieve the require standard of the homogenous ‘magic’ of the Disney experience, use of the more direct methods would provide control of service and intangible aspects. Mead (2005) Additionally having high coordination ensures that subsidiaries are meeting the requirements. Operations in various different countries have alternate work processes for productivity, which need to be measured and evaluated.
Doing this help managers to identify what needs to be altered change of modified to reach the goal expect from the subsidiary. Walt Disney standards need high control as it tries to reflect the same experience at all parks that meet and exceed customer expectations. Their aim is create a unique and one-of-a-kind where the customer feels as though it is ‘magical’. Furthermore all Resorts and parks try to emulate this, as it is part of the customer appeal and competitive advantage. Therefore the coordination between parks needs to be high, as does the reporting accuracy.