People Innovation Excellence

Case Study Disney in France for Cross Culture Management

Until 1992, the Walt Disney Company had experienced nothing but success in the theme park business. Its first park, Disneyland, opened in Anaheim, California, in 1955. Its theme song, It’s a Small World After All, promoted an idealized vision of America spiced with reassuring glimpses of exotic cultures all calculated to promote heartwarming feelings about living together as one happy family. There were dark tunnels and bumpy rides to scare the children a little but none of the terrors of the real world. The Disney characters that everyone knew from the cartoons and comic books were on hand to shepherd the guests and to direct them to the Mickey Mouse watches and Little Mermaid records. The Anaheim park was an instant success.

In the 1970s, the triumph was repeated in Florida, and in 1983, Disney proved the Japanese also have an affinity for Mickey Mouse with the successful opening of Tokyo Disneyland. Having wooed the Japanese, Disney executives in 1986 turned their attention to France and, more specifically, to Paris, the self-proclaimed capital of European high culture and style. “Why did they pick France?” many asked. When word first got out that Disney wanted to build another international theme park, officials from more than 200 locations all over the world descended on Disney with pleas and cash inducements to work the Disney magic in their hometowns. But Paris was chosen because of demographics and subsidies. About 17 million Europeans live less than a two-hour drive from Paris. Another 310 million can fly there in the same time or less. Also, the French government was so eager to attract Disney that it offered the company more than $1 billion in various incentives, all in the expectation that the project would create 30,000 French jobs.

From the beginning, cultural gaffes by Disney set the tone for the project. By late 1986, Disney was deep in negotiations with the French government. To the exasperation of the Disney team, headed by Joe Shapiro, the talks were taking far longer than expected. Jean-Rene Bernard, the chief French negotiator, said he was astonished when Mr. Shapiro, his patience depleted, ran to the door of the room and, in a very un-Gallic gesture, began kicking it repeatedly, shouting, “Get me something to break!”

There was also snipping from Parisian intellectuals who attacked the transplantation of Disney’s dream world as an assault on French culture; “a cultural Chernobyl,” one prominent intellectual called it. The minister of culture announced he would boycott the opening, proclaiming it to be an unwelcome symbol of American clichés and a consumer society. Unperturbed, Disney pushed ahead with the planned summer 1992 opening of the $5 billion park. Shortly after Euro-Disneyland opened, French farmers drove their tractors to the entrance and blocked it. This globally televised act of protest was aimed not at Disney but at the US government, which had been demanding that French agricultural subsidies be cut. Still, it focused world attention upon the loveless marriage of Disney and Paris.

Then there were the operational errors. Disney’s policy of serving no alcohol in the park, since reversed caused astonishment in a country where a glass of wine for lunch is a given. Disney thought that Monday would be a light day for visitors and Friday a heavy one and allocated staff accordingly, but the reality was the reverse. Another unpleasant surprise was the hotel breakfast debacle. “We were told that Europeans ‘don’t take breakfast,’ so we downsized the restaurants,” recalled one Disney executive. “And guess what? Everybody showed up for breakfast. We were trying to serve 2,500 breakfasts in a 350-seat restaurant at some of the hotels. The lines were horrendous. Moreover, they didn’t want the typical French breakfast of croissants and coffee, which was our assumption. They wanted bacon and eggs.” Lunch turned out to be another problem. “Everybody wanted lunch at 12:30. The crowds were huge. Our smiling cast members had to calm down surly patrons and engage in some ‘behavior modification’ to teach them that they could eat lunch at 11:00 AM or 2:00 PM.”

There were major staffing problems too. Disney tried to use the same teamwork model with its staff that had worked so well in America and Japan, but it ran into trouble in France. In the first nine weeks of Euro-Disneyland’s operation, roughly 1,000 employees, 10 percent of the total, left. One former employee was a 22-year-old medical student from a nearby town who signed up for a weekend job. After two days of “brainwashing,” as he called Disney’s training, he left following a dispute with his supervisor over the timing of his lunch hour. Another former employee noted, “I don’t think that they realize what Europeans are like… that we ask questions and don’t think all the same way.”

One of the biggest problems, however, was that Europeans didn’t stay at the park as long as Disney expected. While Disney succeeded in getting close to 9 million visitors a year through the park gates, in line with its plans, most stayed only a day or two. Few stayed the four to five days that Disney had hoped for. It seems that most Europeans regard theme parks as places for day excursions. A theme park is just not seen as a destination for an extended vacation. This was a big shock for Disney. The company had invested billions in building luxury hotels next to the park-hotels that the day-trippers didn’t need and that stood half empty most of the time. To make matters worse, the French didn’t show up in the expected numbers. In 1994, only 40 percent of the park’s visitors were French. One puzzled executive noted that many visitors were Americans living in Europe or, stranger still, Japanese on a European vacation! As a result, by the end of 1994 Euro-Disneyland had cumulative losses of $2 billion.

At this point, Euro-Disney changed its strategy. First, the company changed the name to Disneyland Paris in an attempt to strengthen the park’s identity. Second, food and fashion offerings changed. To quote one manager, “We opened with restaurants providing Frenchstyle food service, but we found that customers wanted self-service like in the US parks. Similarly, products in the boutiques were initially toned down for the French market, but since then the range has changed to give it a more definite Disney image.” Third, the prices for day tickets and hotel rooms were cut by one-third. The result was an attendance of 11.7 million in 1996, up from a low of 8.8 million in 1994.

Analysis:

Many mistakes have been made in the realization of the Euro Disney entertainment park in France. They literally transplanted US culture in France without taking into consideration the cultural clash that this might have caused. US imposed their culture over the French one, and this was seen as an attack to French traditions and customs, resulting in protests from local residence and farmers.

First of all, there was a general misunderstanding of the French culture both under the lifestyle and legal aspects. The top management made wrong assumptions, which led them to take wrong management decisions. In fact, French habits and traditions were not taken in to account. For example, breakfast at the park was not served; instead in the French culture breakfast is one of the most important “moments” of the day. Moreover, alcoholic drinks were not allowed in the park: contrary French always have a glass of wine during their main meals. In addition, also the dress code requirements did not meet the French standards in work environments. And the fact that they were supposed to be always smiling and kind did not reflect the French attitude and the staff was not comfortable with these policies. Furthermore, the top management positions were al given to American, which made the situation even worse because they were incapable to fix the mistakes made from the very start. Instead, if they had hired French people to manage the park, they would have been able to assess these cultural differences in a more efficient way, avoiding such a cultural clash.

Second, it was given for granted that French entertainment culture was as the US one. Thus, staff and resources were allocated in the wrong way, because the peek days were not the same as the US Disney Land. This led to a lack of staff in crowded days and a surplus of staff in empty days affecting efficiency and profitability of the park negatively. Moreover, they assumes French would have gone to the park with their private transportation, thus they built many car parks which were most of the time empty, instead the parking were not big enough for buses, which was the more used transport used to get to the park.

Third, recession signs were not taken into consideration and too high expectations were placed in the profitability of this new Euro Disney. Thus, too high revenue expectations were set and the park did not even manage to sell the tickets available also due to the quite high price imposed. Moreover, the wrong allocation of staff and resources made the situation even worse and the park’s expenses almost were more than its revenues.

From this case study, many lessons can be learned. First of all, never give for granted that if one project is successful according to the parameters of one society and culture, this does not mean that if we export it else where this success will remain unchanged. Cultural factors are crucial for the success of any business and to disregard and to “attack” others traditions and customs can be destructive. Before opening a business already well established in another country, the company has to do a very deep and targeted market research in order to better understand both the culture and how that same business can adapt to the different kind of need clients in the country might have. Moreover, the success of an organization depends on how united the organization is especially the executive, and it is essential to resolve workplace issues, make employees happy with policies and have excellent communication tools. In conclusion, a company should make use of cultural differences to have a competitive advantage over other entertainment parks and make it unique, not only a copy of the already existing ones.

References:

http://www.depa.univ-paris8.fr/IMG/pdf/Disney_Case_Study.pdf

https://geert-hofstede.com/national-culture.html

https://en.wikipedia.org/wiki/Hofstede%27s_cultural_dimensions_theory

https://www2.gwu.edu/~umpleby/recent_papers/2003_cross_cultural_differences_managin_international_projects_anbari_khilkhanova_romanova_umpleby.htm


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