Operations Management Activities at Disneyland Paris - Essay Example

Individual report on Disneyland Paris Disneyland Paris opened in the year 1992, on 12th of April. At that time called thelargest investment in the history of France. A number of reasons led to financial difficulty between 1992 and 1994 which posed an enormous fiscal burden on the park. Europe’s recession resulted to lower tourist spending. A huge fiscal reorganization took place to reduce the debt in 1994. A consortium of 60 banks agreed to arrange for buyers who would be used to pay the debt. In the same year, the park’s name was changed to Disneyland Paris to attract more visitors from the European region. Disneyland Paris targeted a market that focused on generating images, experiences, and products to customers that highlighted fun, service, and imagination. Its intended to offer a place where visitors could escape the concerns of the actual world through the magic of the mythical fairy tale and characters of the Disney family Introduction The Walt Disney Company has struggled to remain faithful to its commitment to producing unmatched experiences of entertainment. The company is built on a rich legacy of quality content that is creative and exceptional telling of stories since its founding in the year 1923. Disneyland was the most expensive single project of construction in Europe’s history and it remains the largest and most ambitious development of its type in the history of Europe (Sehlinger, 2010). It has a single exception of the channel that connects England and France. It took five years to be completed, costing more than 2.79 billion euros. It opened in 1992. Disneyland is a collection of adventures and shows drawn from Disney cartoons and films. However, according to Sehlinger (2010), Disneyland Paris has faced numerous challenges before its inception. One of them was seducing the government of France. A mob of protestors pelted Michael Eisner, the Disney chief executive with farm products from Brie, the day that the stock in Euro Disney was first offered on the Paris stock. Brie was one of the regions next to the future resort site. Moreover, young French communists shouted and heckled. Even citizens who were less radical expressed dismay on the Marne-la-Vallee beet farmers forced displacement. What markets was Disneyland Paris aiming for and how was this delivered through their operations? Disneyland Paris was aiming for a market that focused on generating images, experiences and products to customers that highlighted fun, service and imagination. It intended to offer a place where visitors could escape the concerns of the actual world through the magic of the mythical fairy tale and characters of the Disney family. Disneyland Paris targeted families and children, and it had already built a widespread brand that related to wholesome entertainment of the family (Case study Disneyland Resort, 2013). What were Disney’s main mistakes from the conception of the Paris resort in 1992 through to 2006? The first mistake was the site because the culture, lifestyle and ideas of the French were entirely different from the American culture that caused many people to be opposed to the idea. Initially, the site seemed ideal because of its location that could offer access to millions of people, it is an extremely attractive destination and the Europeans are taking over more vacation generally. However, the company did not expect the backlash it faced as a result of the significant difference in the culture. Cases in point were different eating behaviors, intolerance of long queues of the French visitors and perceived strictness on Disney’s grooming standards by its employees that were met with protests. Additionally, Disneyland Paris did not have adequate housing for the employees, which forced the company to construct rent rooms and apartments in local homes (Case study Disneyland Resort, 2013). Secondly, estimates of yearly attendance figure were being cut considerably from eleven million to just over 9 million by August 1992. Disneyland Paris misfortunes were further compounded in late 1992 when property prices dropped sharply due to a European recession. Consequently, the company admitted serious fiscal hitches due to interest payments it took on the large start-up loans. Moreover, as stated by Raj (2015), the cheap dollar resulted in more individuals taking their holidays in Florida at Walt Disney World. The company’s problems did not halt there, after being criticized for having numerous rides, two roller coasters were opened in July, Indiana Jones and the Peril Temple. However, just a few weeks after their opening, the emergency brakes locked on during a ride resulting in some guests being injured and the ride was temporarily shut down to pave the way for investigations. Additionally, the proposed Disneyland Paris phase 2 was canceled in 1993 due to fiscal problems. It meant that the MGM studios of Disney in Paris and thirteen thousand hotel rooms would not be constructed to the original deadline of 1995, as agreed upon initially by the Walt Disney Company. There were circulating rumors by the start of 1994 that the park was on the verge of bankruptcy. The Walt Disney chief executive Michael Eisner gave an ultimatum to the banks during an emergency crisis talks that were held by the banks and the backers. He said that the company would provide adequate capital until month end. However, unless the banks consented to restructure the one billion dollar debt advanced to the park, the company threatened to close the park and walk away from the whole European venture. This action would have left the banks with a park that had a bankrupt theme and a huge expanse of the almost worthless estate. Walt Disney’s chief executive announced that the company had plans of pulling the plug on the European venture in 1994 at the end of March unless the banks were ready to streamline the loans. The banks succumbed to the company’s pressures. Additionally, in 2003 Andre Lacroix from Burger King was appointed as CEO of Disneyland Paris to take on the challenge of a failing Disneyland Paris and turn it around (Raj, 2015). In your opinion, which aspects of operations management does Disneyland Paris need to improve for its future success and why? Operations management is how companies produce goods and services. Functions of operation are central to a company since it produces the goods and services, the reason for its existence. Of course, Disney Paris land understands its market and its customers. It manages the operations network that design, produce and deliver its products and services in a way that is right for its markets. If customers are not served efficiently, then an organization cannot survive in the long term. Operations management is about designing, producing and delivering products and services that satisfy the needs of the market (Slack, Chambers & Johnston, 2010). One aspect of operations management that Disneyland Paris needs to focus on is on the Gap model. The present day consumer has become more and more demanding. Apart from demanding high-quality products, they also require customer service of high quality. The customer service is considered very much part of the product (Sara, 2009). Providing higher value to the consumer should be a priority for the Disneyland Paris management team. It does not include the authentic physical product, but also service to the consumer as well. Products that do not provide good quality service to the customer that meets his or her expectations are hard to stand in a competitive market. Gap model is a tool that can be used by Disneyland Paris product managers. They can use this model to locate the gaps between the expectations of the customer and the actual services offered at various stages of service delivery. They should also close the gap and advance the customer service (Sara, 2009). Additionally, a theme park development and management needs proactive strategies and reactive responses to adapt to the future. The significant aspect is the managers’ perceptions as regard the alterations that are taking place constantly in the business environment. That is why it is significant to develop the scale of the changes, the factors that can be seen to be affected greatly by them and which subsequently will have to be altered and the expenses related to the foreseen changes. Accordingly, provided there be no obstacles, adaptations can take place in the company. Examples of adaptations are product’s nature, the strategy for communication, commercialization channels, systems of financial management and the systems of information management (Anton-clave, 2007). Operational management of the Parks takes on the importance of the microenvironment. The company’s viability as well as profitability, are in line with their ability to dispose of finances, technology, and instruments to satisfy what the customers requires of them. There is the need for constant refurbishment, re-launching, and remodeling of the current attraction and regular investments since theme parks are very expensive to build and run as well as the cost of site acquisition. Additionally, a skilled human resource will be useful to avoid judgment errors and to manage the park successfully. The company’s concept is to attract millions of customers. The company should invest more both directly and indirectly by renewing the infrastructure and investing in a novel tourism strategy that will enhance the attractiveness of the city as an international tourist destination. For the company to exceed guest expectations, they should have sections of the parks consistent with certain themes. They should also offer immediate guest service recovery or promise an experience that will be magical which the visitors will never forget. The company should offer low-season prices and all-inclusive packages for a less expensive entrance fee due to a lower than anticipated number of guests during the months of winter. Additionally, in order for the company to stay in touch with the communities that it operates in, Disneyland Paris can make use of an efficient media tool such as magazines of high quality, television and posters, since the company has a high budget to spend on advertisement. In April 2012, Disneyland Paris celebrated its 20th anniversary. What advice would you give them for the next 20 years? It should be acknowledged that Disneyland Paris has quickly evolved over the years. However, alterations on the company will have various impacts, according to the geographical area, the park’s characteristics, the operators’ nature and strategies and the type of products and services they will offer. The motivations perception and expectation of the customers will change of the growing significance of the value of the money concept in the decision-making process of the customers (Anton-clave, 2007). Additionally, as part of the business development and planning teams, the Disneyland Paris employees should ensure the future is even brighter than the present legacy through working with the dynamics of the industry. They should also oversee global implications of the Disneyland Paris business strategy. Furthermore, the company’s teams of investor relations and corporate communications should work in identifying growth opportunities that will help it propel to greater heights in terms of success. Opportunities comprise of brand management and strategic planning and may be responsible for reviewing major capital projects, acquisitions, operating performance assessment and earnings and cash-flow forecasting. Conclusion Disneyland Paris should pinpoint and close gaps. This will provide high quality customer service to the customer, and help the company attain their objectives at the same time make the most of their position in the market, market share and fiscal results through the satisfaction of the customer. Furthermore, it will assist the Disneyland Paris managers identify areas of weakness and make improvements to the service delivery of a company. Additionally, since its conception, Disneyland Paris has contributed almost 50 billion euros to the French economy. Moreover, the fact that Disneyland offers high job numbers that hardly need any education has an advantage that there are low levels of unemployment in the area around the theme parks. Reference Anton-clave, S. 2007. The Global Theme Park Industry. CABI North American, Massachusetts. Case Study Disneyland Resort Paris. 2013. StudyMode.com. Retrieved 07, 2013, from http://www.studymode.com/essays/Case-Study-Disneyland-Resort-Paris-1829780.html Raj, M 2015, Disneyland Resort Paris Case Study. Academia.edu Raj, M 2015. Disneyland Resort Paris Case Study. Academia.edu Sara, 2009, The Customer Service Gap Model. Product Management Training and Expertise Sehlinger, B 2010, Unofficial Guide to Disneyland Paris, John Wiley & Sons Ltd, The Atrium, Southern Gate. Slack, NC & Johnston, R 2010, Operations Management. 6th Ed, Prentice Hall, Canada Read More