Beijing Olympics 2008 - Effectiveness of Management - Case Study Example

? Beijing Olympics 2008 – Effectiveness of Management 0 Executive Summary The effectiveness of sport events can be evaluated using a series of criteria. The lack of failures in regard to the management of these events’ financial and operational needs is usually set as the basis for deciding whether a particular sport event has been successful or not. In certain cases, failures related to sport events may not be clear, especially if the events can affect the image of a whole country. In addition, the potential implications of sport events should not be considered as failures. As all project, sport events also can face a series of barriers and delays without this phenomenon to lead to the assumption that a particular sport event has not been successful. Such dilemma has appeared in the case of Beijing Olympic Games of 2008. The findings of studies developed on this event seem to be controversial. The effectiveness of the above event is evaluated in this paper by referring to the literature and the empirical studies that have published in this field. The key finding of the study is that the specific event can be characterized as successful even if the problems appeared during the development of the event’s Strategic Plan have been many, as analyzed below. 2.0 Introduction The effectiveness of 2008 Beijing Olympic Games is reviewed in this paper. A qualitative research approach has been used for reviewing the various aspects of the specific event. A series of studies published in the academic literature has been reviewed in order to check whether the above sport event has been successful or not. Specific aspects of the particular event are set as priorities in this study: Marketing, Operations Quality and Performance, Legal and Ethical issues, Finance, Human Resources and Media. Certain articles published in the local and international press have been also employed, for providing additional information, where necessary, on the issue under examination. The main body of this study has been divided into two parts: Discussion and Findings. In the first of these parts, the Discussion part, the findings of the literature related to this study’s subject are presented, being categorized in order for the coherency of the study to be secured. These findings are then evaluated in the second part of the main body, the Findings section, in order to decide whether the management techniques used for managing the above sport event have been successful or not. The findings of the literature review are supported by graphs included in this study’s Appendix. Conclusions in regard to the issues discussed through the paper are provided in the Findings section; in this way, all conclusions are appropriately supported while any gaps, as revealed through the literature, are highlighted. 3.0 Discussion 3.1 Marketing Marketing, as part of the 2008 Beijing Olympic games, can be evaluated by referring to two, different, facts: the popularity of the specific event as it was in progress and the popularity of the city after the end of the particular event. The Beijing Olympic Games of 2008 can be considered as a major event for China’s public image. In fact, since the end of the Olympics the number of tourists that have visited the region has reached impressive levels; in 2011 about 4.61 million people visited the city, a number that it is quite high (Blanchard and Fan 2012). Gibson, Qi and Zhang (2008) tried to identify the level at which a major sport event can be used as a tool for improving the image of the hosting country. The case of Beijing Olympics is used as an example. A survey was developed in Athens among college students during the Athens Olympic Games of 2004. The objective of the survey was to show whether the intention to travel to China could be influenced by the Olympics in Beijing. It was proved that, indeed, a relationship could exist between the hosting of a major sport event and the intention to travel to the hosting country. The above relationship is presented in the graph included in Figure 1, Appendix. The particular graph has been developed using the findings of the survey mentioned above. The findings of the research developed by Gibson, Qi and Zhang (2008) reveal a series of important facts in regard to the relationship between Olympics and marketing: a) Olympics can be used for marketing purposes, b) the involvement of Olympics in marketing is usually indirect; Olympics contribute in the improvement of the image of the hosting country and c) the potentials of Olympics, as a marketing tool, to secure long term benefits for the hosting country are not standardized. China has tried to use the Olympics of Beijing as a means for ‘building a National image’ (Ni 2008, p.1). Even if this target has been partially achieved the actual benefits, in monetary terms, of the above project are still unclear, a view that it is verified by the financial aspects of the project, as presented in section 3.4 below. From a similar point of view, Zhang and Zhao (2009) trying to identify the terms of city branding and the use of the specific marketing strategy in the case of Beijing. The above researchers developed two surveys, one before the beginning of the Games and one shortly after their end; a questionnaire was distributed to people in two random places that gather a high number of tourists. Also, interviews were developed with officials worked in the Games’ marketing department. The findings of the above research were compared with the findings of literature review, related to the particular sport event. The findings of the research are summarized in table in Figure 1a (Appendix). In regard to the branding potentials of Beijing the following issue should be highlighted: Beijing may has a series of impressive buildings and stadiums, as a result of the recent Olympics; the ‘absence of a two-way communication process’ (Zhang and Zhao 2009, p.252). Indeed, the success of a town, in terms of branding, is not related only to its infrastructure but also to its social and cultural dynamics (Zhang and Zhao 2009). In Beijing, where different cultures co-exist, the lack of common social and cultural initiatives and ideas is quite clear (Zhang and Zhao 2009). 3.2 Operations Quality and Performance The infrastructure needs of the Olympics have been extensive. In fact, about ‘37 stadiums and venues’ (Business Today 2010) had to be developed for hosting the various events of the Olympics. In addition, emphasis had to be given on the training needs of the athletes. About ‘59 training centers were built’ (Business Today 2010) for ensuring that the athletes participated in the Games would have access to advanced training venues. The impressive stadium, Bird’s Nest, had reached a cost of $450 million (Business Today 2010). All stadiums, venues and facilities developed for the Olympics were carefully designed so that they can fully respond to the needs of athletes and the public (Business Today 2010). In this context, as of its quality, the infrastructure used in the Olympics of Beijing can be characterized as excellent (Business Today 2010). 3.3 Legal and Ethical issues The preparation of the Olympics of Beijing has been based on the Beijing Olympic Action Plan. (Beijing 2008, Olympic Games). The specific plan shows all phases of the relevant project. In this way the monitoring of the project have become easier. In addition, this plan would prove that the activities that take place in the context of the Olympics are fully aligned with existing laws and ethics. The following issue should be highlighted: The preparation of the Olympics could be considered as aligned with the local and international legal rules and the athletic standards related to such projects. Still, the actual criteria used for deciding on the funds required for these Games could be possible reviewed, as of their alignment with ethics. Investing quite high amount of funds for preparing and developing an event that could not payback the investment made cannot be characterized as ethical behavior. In fact, today most of the venues developed for the Beijing Olympics are of no use (Wen 2012). No plan has been announced for the management of these venues in the future, a fact that leads to concerns in regard to the ethical standards used for the preparation of the above Games. 3.4 Finance The effective management of the financials of sport events can be identified by reviewing not only the balance between expenses and income, as created during a particular sport event, but also by checking the payback of the event in the long term. For example, using the infrastructure of a sport event for many years after can be considered as a payback of the cost made for constructing/ developing this infrastructure. From this point of view, in sport events reference should be made to both direct and indirect profits. In the case of Beijing the specific issue is made clear. The transport facilities developed for the 2008 Olympic Games that were held in Beijing have been used up today for covering the daily transport needs of citizens (Blanchard and Fan 2012). A problem seems to exist though in regard to the use of the sport facilities developed for the Games. Reference can be made, as for example, to the Bird’s Nest Stadium the cost of which reached the $471 million (Byrnes 2012). The time required for covering the cost of the particular stadium has been estimated to, at least, 30 years (Byrnes 2012). Of course, using the best possible materials for developing the Olympics’ facilities has been an ethical rule, which the planners of the particular Olympics had to respect. However, another issue that should be taken into consideration when designing and constructing the infrastructure of the Games would be the following: this infrastructure should not be prepared only for covering the needs of the Game but for responding to the local needs in the long term (Byrnes 2012). However, the officials of the Olympics did not use this approach; they just focused on the hosting of the Games and not on the future use of the infrastructure involved (Byrnes 2012). As a result today, a significant part of the infrastructure prepared for the Beijing Olympics is left abandoned (Byrnes 2012). The photo in Figure 2 (Appendix) shows the current status of the venue used for hosting the kayaking competition of the Games. As for the Bird’s Nest stadium, it is currently used as a Fun Park under the title ‘Happy Ice and Snow Season’ (Wines 2010). The income from the above use of the stadium is quite low; it will take many years until the funds invested on the construction of the particular stadium are paid back (Wines 2010). The financial implications of Olympics in Beijing can be made clear by reviewing the table presented in Figure 3 (Appendix). In the particular table the budget of the Olympics in Beijing is presented. In the two tables that follow, important details of the particular Olympics are revealed: a) the investment on the construction projects of the Olympics has been quite high (Figure 3a), b) the amount that Beijing spent on the Olympics has been higher than any other Olympic city (Figure 3b) and c) the highest part of the funds required for the development of the Olympics have been offered by the State, at a percentage of 85%, while the participation of the private sector has been just 15%; the distribution of cost of the Olympics in Beijing between the public and the private sector has been different than any other Olympic city (Figure 3b). This fact can reduce concerns in regard to the financial implications of the particular Olympics. The government has been able to locate the funds required for the Olympics without any implications to exist for the state’s other financial obligations (Figure 2b). Probably the potentials of the Olympics to payback this investment even in the long term have been identified by the Chinese officials involved in the planning of the particular sport event. 3.5 Human Resources The Beijing Olympic Games have resulted to the creation of an extended workforce, for covering the HR needs of the particular event (Wines 2010). The specific staff has been also used in supporting the businesses (such as hotels, restaurants, leisure facilities etc.), which were established because of the Games (Wines 2010). However, immediately after the end of the Olympics the number of tourists in Beijing was radically decreased (Wines 2010). This has led to the closure of many of the businesses that were depended on the Olympics (Wines 2010). The expectations for impressive number of tourists during and after the Olympics were proved unfeasible (Wines 2010). The effects of Beijing Olympics on employment are presented in Figure 4 (Appendix). According to the relevant table, the unemployment rate in Beijing tends to be increased, continuously, from 2000 up to 2010, despite the Olympics of 2008. In addition, the percentage of employees hired for covering the needs of the Olympics seems to be at its peak point at 2005, being declined then in 2006 and 2007. From 2008 onwards the employment made for the Olympics is presented as zero percentage, indicating probably the stabilization of the job market and the termination of the employment contracts signed in the context of the Olympics (Figure 4). 3.6 Media At this point, particular emphasis should be given to the role of media during and after the Olympics of Beijing. As already explained the Olympics of Beijing, as also any such project, have been used for improving the image of the hosting country, i.e. of China. Media has not particularly favoured China in regard to the preparation and the development of the Olympics. Rather, strong criticism has been developed for any negative aspects of the Olympics. This fact is verified through the articles presented in this study, as these articles have been published in quite popular media worldwide. Reference is made, for example to the following articles: Wen (2012), Business Today (2010), Wines (2010), Byrnes (2012) and Blanchard and Fan (2012). The research developed by Preuss and Alfs (2009) reveals an important fact in regard to the media coverage of Beijing Olympics; according to the above researchers, the press in USA ranked first in covering the above event (Figure 5); the Chinese press ranked third (Figure 5). This means that the event was not adequately covered, in terms of media by the hosting country. 4.0 Findings According to the issues discussed above the Olympics of Beijing have failed to respond to the expectation of their planners. The Olympics were supported by extensive and of high quality infrastructure so that their success to be secured. In addition, the hosting country has used the particular event in order to improve its image worldwide. As proved through relevant empirical findings (Zhang and Zhao 2009) the use of the city for branding purposes has not been successful; the city’s infrastructure network, as resulted from the Olympic Games, may be impressive but the communication between cultures is absent. In addition, the financial aspects of the above event can also lead to concerns: the actual cost of the Games cannot be paid back, at least for a long period of time. This fact leads to doubts in regard to the effectiveness of the criteria used by the event’s planners; it has been made clear that the Chinese officials involved in the project aimed to create a unique athletic event but failed in identifying a plan for the future use of the Games’ infrastructure. On the other hand, the performance of the Games in regard to the enhancement of the local employment has been rather low; this is another fact that leads to concerns in regard to the Games’ actual benefits. Finally, the coverage of the Games by the local press has been quite limited, a fact denoting the lack of effective cooperation between the individuals worked in the project’s marketing plan. The benefits of the Beijing Games could take quite a lot of time to appear, if there would be such case. 5.0 References Beijing 2008 Olympic Games (2008) Beijing Olympic Action Plan. Available at http://en.beijing2008.cn/59/80/column211718059.shtml Blanchard, B. and Fan, H. (2012) (2012) Beijing's deserted Olympic sites. May 2, 2012. The Globe and Mail Available at http://www.theglobeandmail.com/sports/olympics/beijings-deserted-olympic-sites/article4106854/ Brunet, Ferran; Zuo Xinwen (2008): The economy of the Beijing Olympic Games: an analysis of first impacts and prospects [online article]. Barcelona: Centre d’Estudis Olimpics UAB. Business Today (2010) Post-Olympics Beijing. Available at http://www.businesstoday.org/magazine/temporarily-cancelled-running-bull/post-olympics-beijing Byrnes, M. (2012). Beijing's Olympic Ruins. The Atlantic Cities. Available at http://www.theatlanticcities.com/jobs-and-economy/2012/07/beijings-olympic-ruins/2499/ Gibson, H., Qi, C. and Zhang, J. (2008) Destination Image and Intent to Visit China and the 2008 Beijing Olympic Games. Journal of Sport Management, 22, pp.427-450. Available at http://www.humankinetics.com/AcuCustom/Sitename/DAM/067/224_Gibson_Destination_and_.pdf Guo, W. (2009) A Case Study on the Tourist Impact Perception of Chinese Residents about Beijing Olympic Games. Fudan University, Shanghai, China. Available at http://jpkc.fudan.edu.cn/picture/article/179/6d/63/5a38fccc40e3b453b4c5df39a418/28646af1-6004-49df-9658-8e8091bf68ae.pdf Jianping, N. (2008) The Beijing Olympics and China’s National Image Building. Shanghai Institute of American Studies. Hong Kong , May 28, 2008. Avaiable at http://www.cctr.ust.hk/materials/conference/workshop/14/nizp_olympics.pdf Preuss, H. and Alfs, C. (2009) The Perception of the 2008 Beijing Olympic Games in China and the World. Working Paper Series. Mainzer Papers on Sports Economics & Management. Available at http://www.sport.uni-mainz.de/Preuss/Download%20public/Working%20Paper%20Series/Working_Paper_No_1_Signaling_Beijing_2008_091123.pdf Wen, W. (2012) Olympic venues could be 'white elephants' without more revenue. Jan 16, 2012. China Daily. Available at http://www.chinadaily.com.cn/business/2012-01/16/content_14450850.htm Wines, M. (2010) After Summer Olympics, Empty Shells in Beijing. Feb 6, 2010. The New York Times. Available at http://www.nytimes.com/2010/02/07/weekinreview/07wines.html?_r=0 Zhang, L., and Zhao, X. (2009) City branding and the Olympic effect: A case study of Beijing. Cities 26 (2009), pp. 245–254. Available at http://www.iprsc.com/research/city_branding_and_the_olympic_effect_a_case_study_of_beijing.pdf 6.0 Appendix Figure 1 – Relationship between tourist characteristics, destination image and intention to travel (source: Gibson and Zhang 2008, p.441) Figure 1a – Beijing’s attributes (source: Zhang and Zhao 2009, p.250) Figure 2 – Photo of the venue for kayaking competition of Beijing Olympics (source: Byrnes 2012) Figure 3 – Budget of Beijing Olympics (source: Brunet and Xinwen 2008, p.6) Figure 3a – Construction costs of Beijing Olympics (source: Brunet and Xinwen 2008, p.7) Figure 3b – Investment on Olympic cities (source: Brunet and Xinwen 2008, p.7) Figure 4 – Beijing Employment Dynamics (source: Brunet and Xinwen 2008, p.20) Figure 5 – News reports on Beijing Olympics (source: Preuss and Alfs 2009, p.10) Read More