American businesses make assumptions about the transferability of their business, management, marketing, economic and structural models of organizing which frequently fail to take into consideration cultural differences. An example of the consequences of such an approach to intercultural business practice can be found in the Disney Corporation's recent Chinese venture, now called Disneyland, Hong Kong. Lack of cultural sensitivity and the negative infiltration strategy used by the Disney Corporation resulted in a great loss of time, money and reputation for which the corporation has only recently begun to compensate.
After examining many struggles in Japan and France, especially in France, this paper examines how the strategy Disney used when entering China, a crucial venture for Disney’s success worldwide. Did Disney learn from the mistakes it made in Japan and France and implement those strategies in China? It is the primary aim of this paper that the initial losses experienced by the Disney Corporation in Tokyo, Paris and Hong Kong may have been prevented if only its representatives had known then what they know now: that organizations are not distinct, separate entities capable of functioning outside their physical, social and cultural environments. This calls for a different approach to Disney’s international business strategy , one which begins with the most basic aspect of human organizations, namely effective, meaningful, communicative interactions between people.
1. The Walt Disney Company
The Walt Disney Company is the second largest media and entertainment corporation in the world, after Time Warner, according to Forbes. Probably most noted for its cartoon-like movies and ostentatious theme parks, Disney has become a worldwide venture. Founded on October 16, 1923 by brothers Walt and Roy Disney as a small animation studio, it has become one of the biggest studios worldwide, and is noted as having eleven theme parks worldwide and several television networks, including the American Broadcasting Company (or ABC). Disney's corporate headquarters and primary production facilities are located in California at the Walt Disney Studios (Burbank) and its primary theme park (Disneyland) is also located in Anaheim, California. The company is a component of the Dow Jones Industrial Average. It had revenues of $34.3 billion in 2006. 2. Disney Theme Parks Worldwide
Walt Disney Parks and Resorts is the division of The Walt Disney Company that conceives, builds and manages the company's theme parks and vacation resorts, as well as a variety of additional family-oriented leisure enterprises. It is one of the four major units of the company, the other three being Consumer Products, Media Networks and Studio Entertainment. The Parks and Resorts division was founded in 1971 as Walt Disney Attractions when Disney's second theme park, the Magic Kingdom at the Walt Disney World Resort in Florida, opened, joining the original Disneyland in California. The chairman of Walt Disney Parks and Resorts is James A. "Jay" Rasulo, formerly the chairman of Disneyland Resort Paris. 2.1 Success in Japan
Tokyo Disney Resort, located in Urayasu, Chiba, Japan, opened in 1983. In 2001 the resort expanded with Tokyo DisneySea. There are several resort hotels on site, but only two are actually owned by the resort, which boasts the largest parking structure in the world. Tokyo Disney Resort is fully owned and operated by The Oriental Land Company and is licensed by the Walt Disney Company. The resort was built by Walt Disney Imagineering, and Disney maintains a degree of control; Nick Franklin leads the Walt Disney Attractions Japan team at the Walt Disney Company, which communicates with the Oriental Land Company over all aspects of the Resort, and assigns Imagineers to the Resort. Standardization and transference of the American culture worked beautifully in Japan, turning it into a highly profitable venture, which...