Category: Disney

Executive Summary

Visitors are the key factors of the theme parks and therefore the management must take into consideration the major influencing factors. Theme parks in Europe receive over 60 million visitors annually but this number is considerably low compared to U.S. This is attributed to geographical factors and national appeal. In addition, there is considerably high competition from the local museums and historical parks.

In order to gain competitive advantage new theme park must get it right on it’s marketing and staffing strategies. Disneyization is used to describe the process through which Disney Company has been able to penetrate different markets globally and forms parts of its marketing and human resource strategy.

Introduction

Overview

Clave (2007) defines theme park as a gated attraction that includes rides and shows in a themed surrounding, offering ticket price for its visitors and attracts at least a half a million visitors annually. A more comprehensive definition of theme parks was given by Economic Research Associates (2008, p. 5).

They define a theme parks as a capital exhaustive, highly developed, self-sufficient space which charges admission invariably. Theme park facilities are normally arranged in a thematic fashion and may represent physical or historical features.

These themes are important to the operations of the park since they generate a feeling of attachment in a setting which is a complete contrast of the real world. However, it should be noted that there is a distinction between the commercial theme parks and the outdoor museums or historic theme parks.

The latter focuses less on commercial aspects and there main goal is to preserve historical/national heritage and for public education. Theme parks are more intricate than the normal city parks or recreational spots. Theme parks have a blend of attractions which can be classified into a number of categories.

They include ecstasy rides, family rides, water attractions, dark rides and roller coasters. The main source of revenue for the theme parks comes from the gate charges. There are also standard admission for pay-one-price Park and charges for some services excluded from the admission charge (Davis, 1996, p. 400).

Visitors are the key factors of the theme parks and therefore the company must take into consideration the major influencing factors. The most frequent visitors in the theme parks are normally families and friends (Clave, 2007, p. 5). According to Jafari (2000, p. 683) Theme parks in Europe recorded more than 60 million attendance which represented a 3 percent growth compared to the previous year.

However, these European parks are stagnant compared to their counterparts in U.S. This is attributed to geographical factors and national appeal. Each European country has a unique park and a lead market. Besides Disney parks, European theme parks are local ones.

Brief Account of the Disney Company

The company was established in 1923 in Burbank as a cartoon studio by the two Disney brothers (Walt Disney and Roy Disney). Three years later the company created two movies and purchased a studio in Hollywood, California. Logistic problems nearly led to the demise of the company but it was saved by the designs of Mickey Mouse and Donald Duck.

Later on the company managed to secure merchandise licensing, complete animated pictures, TV programs, live action movies and ,of course, one of the company’s grand project, a theme park by the name Disneyland (Bryman, 1995, p.3).

The first Disney Park was opened in Anaheim in 1955. The company maintained its success and became under the control of Roy after Walt died. In the past few years, the company has expanded its market through cables and creating subdivisions such as Touchstone to make films instead of the typically family-oriented fare.

During 70s and 80s the company was on the edge of being taken over but everything got well thanks to the team of experts who have ensured that the company maintains its traditions of brilliance to date. Walt Disney is a global company operating four major commercial divisions: Media Networks, Studio Entertainment, Parks and Resorts and Consumer products (Bryman, 1995, p.5).

The company’s main challenges are: exceptionally large workforce, repeated change in leadership and towering operating costs. Company’s expansion means increased number of employees and complex structure. This becomes even more complicated with the company’s tendency to change its corporate officers now and then (Davis, 1996, p. 403).

Even though there are very many positive elements associated with expansion and change is leadership, this can also result in too much struggle and massive expenditure. Large number of workforce and fixed assets normally leads to increased operating costs and this cost is passed to the consumers.

No visitor will be willing to pay for a ticket price that is above $35 and therefore the company must strictly regulate their operating cost to match the price customers are willing and able to afford for their goods and services (ERA, 2008, p. 16).

Walt Disney Company has experienced abundant external opportunities, for instance, governments’ attitudes towards their operations, barriers of entry, massive number of loyal visitors and the entertainment industry. Officials and government forces have been identified through experience as being part of the negative external aspects of the company (Weinraub, 1995, p. 12).

However, some governments have even helped to fund a number of the company’s project; for instance, French government donated $1.2 billion to help the company build transport facilities and even offered it tax reliefs (Smith & Clark, 1999, p. 59).

The purpose of the Report

The main purpose of this report is to come up with a staffing and marketing requirements needed to create a new Walt Disney theme park in Slovakia to attract more tourists from Eastern Europe. The report will act as a guide during staff recruitment and deciding on the best marketing strategies.

Marketing Disney Theme Parks in Eastern Europe

The term ‘Disneyization’ has been used to refer to the process through which principles of the Disney theme parks dominates all aspects and different sectors of the society. Disneyization is presented as encompassing four facets: dedifferentiation of consumption, merchandising, theming the society and emotional staff. The origin of Disneyization in theories of consumerism and consumer culture is the concept of McDonaldization.

McDonalization is a term that has been used to refer to how the McDonald restaurants managed to incorporate their culture in the U.S. society and the rest of the world (Ritzer, 1993).

According to Ritzer (1993) McDonalization comprised of four dimensions and these are efficiency, calculability, predictability and control. These dimensions were drawn from Disney parks and other theme parks. However, the idea of Disneyization was introduced to reflect and build upon the proposition that there is more to theme parks than McDonald institutions (Ritzer, 1993).

Theming is the first and obvious element of Disneyization and involves theming different areas of economic life. There are numerous themed recreational facilities, which draw on famous and accessible cultural themes as hip-hop and other types of music, sports, movies, personalities, geography and history.

Examples of the theme restaurants include Hard Rock Cafe, Planet Hollywood, Harley Davidson Cafe, and Fashion Cafe among others. Most of these themed restaurants are not sought after because of their food, but because of the sounds ands sight that are constitutive of the themed environment (Ritzer, 1993). Themed pubs and restaurants are very popular in U.S., Europe and a number of Asian countries.

Theming can also be extended to famous landmarks in the country, transport facilities, shopping malls, supermarkets, schools and other social facilities. These have helped to incorporate Disney principles and culture into the society and can be adopted in Slovakia and other countries in Eastern Europe to market the company’s theme park (Davis, 1996, p. 399).

The company’s founder used theming as a device for differentiating his vision from tasteless and mucky amusement parks to which he had taken his children. He noticed that many parents like him visited these parks just to appease their children. As a result of this, he felt the urge to create a park that would also accommodate adults.

As a matter of fact, he was more successful to this regard since the number of adults who visits the park at the moment has more than tripled the number of children. Therefore, the goal of the company’s founder and his successors was to use theming as a mechanism of appealing to both adults and children and to differentiate Disneyland from amusement parks.

For that reason the New Disney Park in Slovakia should lace many of the attractions and environment with captivating nostalgia that would have direct appeal to both adults and children (Bryman, 1995, p. 15).

Theming accomplishes two major things. First, it creates a connection between the park facilities and attractions and the environment in which it is located. Second, the designs of rides and attractions are placed on their themes instead of the thrill factor which was common in the traditional amusement parks.

Disney ‘lands’ (distinctive subdivisions in the park) should be presented through structural design, scenery, costuming, live entertainment, attractions, products and food and beverages that reflects the local/regional cultures and historical/national sites. In each land, theme intrusions and distractions should be minimised to ensure visitors becomes totally submerged in its ambience (Davis, 1996, p. 404).

Dedifferentiation of consumption denotes the broad-spectrum trend whereby the forms of consumption and institutional principles are interlocked together and increasingly become very hard to differentiate. The new Disneyland can be used as vehicle for selling food and several goods. It should not only act as a house of attractions but also a context for shopping.

This will help to market the theme park far and beyond Slovakia (Bryman, 1995, p. 16). Disney theme park concepts have been used to optimize the mix of goods in stores within the theme parks and are highly profitable and can achieve the maximum sales per square metre for retail stores. Therefore, tendency for shopping, eating, hotel accommodation and theme park visiting should become inescapably entangled.

Dedifferentiation of consumption should encompass main terminals, national museums and heritage attractions where visitors are forced to exit through miniature theme parks with Disney products and services.

The company should also engage local restaurants in a form of dedifferentiation, for instance linking there range of foods with Disney Cartoon characters and films. Some of them should attach themselves to the opening of the new Disney theme parks by offering free gifts to the visitors (Davis, 1996, p. 410).

Merchandising is also another marketing strategy that can be used by the company. Merchandising refers to the marketing of products in the form of or bearing patent images and logos of Disney Corporation. This is a realm in which the company has been most excellent and can be replicated in Slovakia and the whole Eastern Europe.

Instead of using Disney cartoon characters, the company can chose to promote some of the products and services offered in the theme park in this manner (Davis, 1996, p. 408).

Merchandising is one of the most effective marketing tools since it enhances the emotional attachment among the Disney funs and has long term advertising effect. Disney merchandise range from clothing, to books, sweets, watches, and other domestic products (Johnson, 1991, p. 40).

The company’s Studio and Entertainment division can also play a significant role in marketing the new theme park. They can produce and distribute animated action films, music recordings, home entertainments with local and regional contents. Use of local and regional scenes, music and culture will make the Slovaks and other citizens of the Eastern Europe to feel like being part of the larger Disney family.

The company can also resort to the conventional advertising and marketing strategies to complement Disneyization. These include the use of billboards and other local and international mass media (Jafari, 2000, p. 685).

Staffing On New Disney Theme Park in Slovakia

The changing nature of the global economy requires new innovations and strategies in organizations so as to continue with competitive advantage. These comprise training and development of the human resource to enhance productivity and overall business performance.

Organizations are taking huge risks by spending greatly on human resource training and development. Business executives analyze innovation as one of their top most challenges. Innovation in this case refers to upgrading the human resources to meet the new challenges posed by the dynamic global economy (Dessler, 2008).

Strategic human resource management is considered as a method of management which aims at managing the employees with the motive of achieving an efficient competitive advantage.

Strategic human resource management is considered as the supervision of the contributions of the employees to the organization in order to accomplish a desired objective, therefore, an organization with well organized and reliable staff members is in a good position to achieve a competitive edge.

Cortese (2003) recommended that organizational strategies must take the form of a process of continuous learning, in which at the limit, preparation and execution becomes impossible to tell apart.

He proposes that organizations should generate, develop and maintain excellent business designs capable of taking advantage of its strategic landscape and business environment beyond the lifetime series of changes in an organization. This can only be achieved through self-organizing process of the individual employees.

He acknowledges the role of strategic planning and the formation of networks since individual errors may have severe impact in the organization as a whole.

The resource based theory, also known as the resource based view of the firm, is one of the latest strategic management concepts to be enthusiastically embraced by marketing scholars (Dessler 2008). This theory focuses mainly on the resource base a firm has other than the finished products of the firm. A firm gains competitive advantage by suitably employing its resources in production.

Competitive advantage here refers to the state where the firm adopts strategies of production which add value to the resources and these strategies are not common in the competing firms. Hill et al (2006) confirm that resource diversity and resource immobility are the two main hypotheses that the resource based theory of the firm are based on.

Many authors have been relatively silent about the nature of work in Disney theme parks. But it clear from Ritzer (1993) that since the company incorporates scientific management and principles of the Ford Corporation, working in the theme park tend to be dehumanizing and isolating. He emphasized that there is more to theme park jobs than simple clerical jobs found in many industries.

Ritzer drew attention to the fact that besides the normal desk skills, service work also entails self control through emotional labour, which he defines as ‘an act of articulating socially desires emotions during service transactions’. According to Leidner (1993) besides controlling how these workers interact with the clients, the company should also control how they view themselves and their feelings.

However, there are still uncertainties on how far emotional labour is associated with theme park jobs. Leidner (1993) stress that service sector such as theme parks demands employees who are amusing, jovial, ever smiling, and courteous and those who take pride in their work. Therefore, this type of job requires overt behaviours and less of introverts.

Emotional labour should be epitomized by Disney theme parks. The character of employees in the theme park should be managed in many ways and regulated through a scripted interactions and promoting of emotional labour should be one of the principle aspects (Davis, 1996, p. 412). Friendliness and helpfulness among the Disney theme park employees is well-known all over the world and has been praised by many visitors.

The conduct coupled with distinctive language of the company is intended among other things to express the impression that the workers are also having fun and therefore are not taking part in real work. Therefore, the new Disney theme park in Slovakia should ensure that the staff hired have the attributes typical of the Disney employees and satisfactorily trained to master and improve on the necessary skills.

Walt Disney University was specifically built to inculcate the essential training and teaching of Disney vocabulary to the new recruits. According to the founders of this institution, the fundamental element of the early training approach was to inculcate friendly phrases in addition to a friendly smile (Clave, 2007, p. 6).

Conclusion

Visitors are the principle component of the theme parks and therefore companies must ensure all the influencing factors are taken into consideration. Sustainability of the theme parks can only be ensured if they maintain the existing clients and attract more visitors. Theme parks in Europe receive considerably high number of visitors annually but this number is relatively low compared to U.S theme parks.

This is attributed to geographical factors and socio-economic factors. In addition, there is considerably high competition from the local museums and historical parks. Therefore, marketing and staffing policies for the new theme park must be set right.

Disneyization is used to describe the process through which Disney Company has been able to penetrate different markets globally and forms parts of its marketing and human resource strategy. In addition, the company can use the conventional marketing strategies to complement Disneyization. These may include use of billboard, wall paintings, printed fliers and advisements through local and regional mass media.

References

Clave, A. (2007). The global theme park industry. Oxfordshire: CABI.

Cortese, A. D. (2003). The critical role of higher education in creating a sustainable future. Planning for Higher Education, 31(3), 15-22.

Bryman, A. (1995). Disney and his Worlds. London: Routledge.

Davis, S.G. (1996). The theme park: global industry and cultural form. Media Culture and Society, 18, 399-422.

Dessler, G. (2008). Human resource management. New Jersey: Prentice-Hall, Englewood Cliffs.

ERA. (2008). Theme Park Attraction Attendance Report 2007, Burbank, p.16.

Hill, C.W.L. Jones, G.R., & Galvin, P. (2006). Strategic management: an integrated approach. Milton, Australia: John Wiley and Sons.

Jafari, J. (2000). Encyclopaedia of Tourism. London/New York: Routledge, pp.683-690.

Johnson, R. (1991). A strategy for service-Disney style. Journal of Business Strategy, 12, 38-43.

Leidner, R. (1993). Fast Food, Fast Talk. Berkely, CA: University of California Press.

Ritzer, G. (1993). The McDonaldization of Society. Thousand Oaks, CA: Pine Forge.

Smith, D., & Clark, S. (1999). Disney: The first 100 years. New York: Hyperion, 59-60.

Weinraub, B. (1995, April 9). Clouds over Disneyland. The New York Times, p. 12.

Introduction

Euro Disney chose variety of appealing themes to its parks and other business entities, the choice encompasses variety of tastes and interests. Disney market opportunity in Europe is considered ripe because of the vast population present, favorable per capita spending and long vacation periods.

The complex extension of Disney requires wise choice of markets within various European countries. Their movies represent symbol of American culture which are accepted worldwide without any discrimination (Price, 2000).

Disney Corporation is planning to move its operations to other parts of the world because of its diverse services. For the company to compete favourably in these markets it has to come up with workable marketing strategies. The targeted market is in the far- east and Europe specifically Tokyo and Paris.

Disney has a burning desire to serve as many cultures as possible all over the world. The Company’s unique sense of creativity and imagination can be well utilized to conform to the culture of both Asia and Europe communities (Burgoyne, 1995).

Compare Disney’s Approach in the Japanese and French Markets

Disney has been considered successful in Japan as far as international marketing is concerned. This is because it provides the real extension of services from America, the quality of guest service and imagination. It is a pure replica of the American Disney service delivery systems. However, the difference in culture makes it tricky for the penetration of Disney brand of entertainment into Japanese lifestyle.

Also the per capita spending in Japan is a bit high since there is clear trend towards leisure and recreation. This is contrary to the French market where leisure is considered a lifestyle and vocational practice. The French market has received support from the well built and connected infrastructure put in place by the French government and further boosted Disney by providing tax incentive.

The government built new railway line for the purposes of helping Disney land transport tourists to the Park. Disney built a complex in France that was reflecting more of western American culture; this was contrary to the original idea which was meant to accommodate the preferences of visitors of European origin and certain French cultural requirements (Cateora & Graham, 2006).

The approach Disney used in France was meant to target the visitors that had been to United States Disneyland who currently leaves in Europe. The design of the theme parks focused on attracting the visitors and create impression that could enable them desire to be back more often for the wonderful experiences.

Disney did market research in France where they involved the vocal French intellectuals and government officials to assist in adopting Disney Park design to suite the cultural requirement. In France Euro Disney provide foods from around the world at its theme parks and hotels while in Japan they use American flavor in most of the occasions.

The services rendered by Disney employees in Japan is quite different from that of Europe, this is because of the success in Japanese culture which focuses in obedience to management and teamwork. The level of efficiency achieved by Japanese staff is owed to their character of being polite and obedient.

Quality of service and the way it is delivered to customers form the primary concern of Disney in Tokyo and also the teamwork spirit (Cateora & Graham, 2006).

Political stability in both countries is an important contributor to the stability of Disney investment since it helps in providing peaceful environment that favors business in the theme Parks. The stability makes mode of entry for Disney to be smooth lowering the chances of risk factors.

Why the Euro Disney Marketing plan has not succeeded in France?

The joint venture that Disney made with the French government proved to be good investment especially on the side of risk coverage. On the other hand it has made it very difficult for Disney during low seasons whenever visitors are less than the targeted number.

It makes it very difficult to exit the market in case of subsequent losses. There is also the difficulty of incorporating the cultural diversity within the parks, there is the question on whether the American theme park can attract and please people of different ages and nationalities as it does within Tokyo (Mujtaba, 2006).

The service adaptation at the Disney parks within France has not so much reflected cultural requirements, French eating habits and park design. The management should have Disney’s investments protected through legal laws to ensure easy recovery in case of losses. The company did not do enough intensive quality control and thorough check up on products.

The failure was also attributed to several factors some of which are failure to assign the right personnel for the right job at the start of the business. There was miscalculation done on the drinking characteristics of the French population. The start of operations in Europe was marked by services devoid of alcohol drinks since it was one of the Company’s working policies in America and Japan.

This alone caused some negative attitude towards Disney in France, since the people believe in being served with alcohol after meals. There was also little understanding by the management on the French breakfast and food culture (Keegan, 2002). The trip to Paris had also been considered expensive due to changes in currency hence trip to Orlando was preferred by most guests.

Critique of the CEO’s salvation plan

The combination of American design with the European preference destroyed the American spirit and culture within the theme parks. Disney Corporation’s CEO should have first of all monitored at a close range the performance of other companies offering the same services in these areas.

This is of advantage since it could give Disney the chance to evaluate and set its investment priorities right. It should first of all start by building a theme park to assess the market potential then include other projects like hotels later. Some governments regulate the number of films released in their market environment annually which is a big challenge to Disney’s animated films (Keegan, 2002).

Disney Corporation’s CEO should also first of all test the market’s worth through the building of parks. This may help in determining the actual size and status of the market since it serves both local population and foreigners.

It is easier to influence local community and foreigners to visit parks than hotels or buy animated films. In addition Disney should put strategies on how to attract through their services, the large number of tourists that visit these areas. The amount of money it costs to put up these projects should be calculated based on the level of risks involved (Keegan, 2002).

Euro Disney Today

The implementation of teamwork and total quality system is not utilized in Euro Disney due to cultural differences. The attitude training undertaken by Disney University could not be successful in Europe, especially France, since the citizens are used to entertainment that is more intellectual in nature.

This made it difficult to change to change the employees’ attitude on the concept of entertainment towards guest which is more oriented to pleasing guests (Burgoyne, 1995).

Disney failed in Europe in the area of Human resource management because of their lack of awareness on culture differences and lack of familiarity with the French Laws and the traditional practices of the French citizens (Burgoyne, 1995). Disney used ethnocentrism marketing approach in Europe, there was no significant differences made in the kinds of Parks that were built in other countries.

Hence, the absence of long-term strategies and factors that promote partnership presented a set-back to the success of Euro Disney. They failed to recognize local employees’ efforts towards the success of Disney, which contributes to employees’ low self-esteem (Mujtaba, 2007a).

The Euro Disney operations were started with no alcohol service at their parks. This extension worked well in other destinations like Japan, Florida and California but not in France. This is because alcohol is so much valued in France such that a glass of wine is mandatory for meals.

This was later allowed and is now used in Euro Disneyland theme parks (Burgoyne, 1995). Euro Disney reveals the fact that cultural awareness is an important determinant on the extent to which business venture can succeed internationally.

Tokyo and Hong Kong Disneyland Today

Hong Kong Disneyland is still in its prime stages, currently still has only one park that requires only a day tour. Most of the attractions within Hong Kong Disney are replica of the original Disneyland in the USA, it experiences low number of visitors compared to Tokyo parks and their services are a bit more modest compared to Tokyo’s.

The city of Hong Kong offers unique destination for full culture exploitation though it still has few opportunities for variety of diversions. Hong Kong Disneyland requires improvement on its cultural impact in the process of delivering their services. Their films are considered of abuse to cultural integrity (Hofstede, 1980).

There is the challenge of using meaningful scribbles to suit every local culture served, this seem a challenge especially when it comes to Chinese way of writing. The use of magic does not interest at all, majority of the cultures in the far-east. There is big target market for Disney in Hong Kong and China as well.

The problem lies in long waiting lines and the issue of Chinese visitors not tolerating the kind of waste from snacks served in waiting queues. In the case of Shanghai, there are some elements that must be considered to generate an idea on how to plan and approach the market. The population in Hong Kong should be considered in order to determine the amount of space required to establish the operations.

Majority of the young population within this area like products with cartoon pictures on them, this provides a good market base (Hofstede, 1980).

The urban population is considered the wealthiest; however they should be grouped according to their financial ability. The criterion to be used to estimate the economic status of the market should be addressed. However, the city is reach in domestic tourism which provides Disney Corporation with a sure and available market.

Tokyo Disneyland presents perfect example on cultural fit for Asian cultural needs. Tokyo Disney is regarded as having some sense of prestige to the Asian culture and also shows good example of societal status (Keegan, 2002). It creates a good feeling for the Asians finding association in American culture which is contrary to what Europeans crave for.

Creation of Tokyo Disney is based on original Disney Park themes in United States of America, the parks are characterized by unique attractions and it’s famous for hosting lavish events found in any Disney branches all over the world. The park is uniquely and expensively built characterized by Disney Sea which provides an exclusive concept of theme park, making it the most beautiful in the world.

Conclusion

Disney use socioeconomic factors to determine the right market segments to invest. The level of consumption for Disney products and services are controlled by the consumer’s level of income and the country’s economic development. This has made Europe one of the best alternative markets to United States since most of the products from US form part of the Global marketing strategy.

The five week vacation in Europe forms a greater market base for Disney compared to period of only three weeks in United States. Euro Disney provides clear description on how failure can be realized whenever the HR department fails to perform its duties. It also gives a number of practices that should be put into consideration for attaining the company’s strategic goals.

References

Burgoyne, L. (1995). Walt Disney Company’s Euro Disney Venture: A Study in Corporate Foreign Expansion. Hidden Mickeys. Web.

Cateora, P.R., & Graham, J.L., (2006). International Marketing. (13th Ed.). New York, NY: The McGraw-Hill Companies, Inc.

Hofstede, G. (1980). Culture’s consequences: International differences in work related values. Beverly Hills, CA: sage publishers.

Keegan, W. (2002). Euro Disney Case (A). Global Marketing Management. 7^th Ed. Prentice Hall, New Jersey, USA.

Mujtaba, B. G. (2006). Cross Cultural Change Management. Tamarac, Florida: Llumina Press.

Mujtaba, B. G. (2007a). Cross Cultural Management and Negotiation Practices. ILEAD Academy Publications; Florida, United States.

Price, A. (2000). Human Resource Practices at Disney, HRM Guide. Web.

Introduction

Marketing can simply be defined as business activities aimed at ensuring smooth flow of goods and services from one destination to another (Kotler & Armstrong, 2001, p. 4). In order for any business to carry out marketing functions successfully they have to adopt the following marketing concepts:

1. consumer orientation,
2. integrated marketing,
3. consumer satisfaction.

To achieve this businesses have to plan, organize, and control their marketing operations (Pulendran, Speed & Widing, 2003, p. 476). Generally, marketing concepts are realized through product, communication, distribution, and pricing strategies. A combination of the above four elements is what in commonly known as marketing mix (Kotler & Armstrong, 2001, p. 5).

For global marketing everything remains the same except that business activities take place across borders. In global marketing, physical movement of goods and services is not always necessary. In other words, global marketing takes place any time marketing decisions are made between two or more countries (Keegan, 2002, p. 23).

According to Van Mesdag, 2000, p. 75) global marketing is almost synonymous with the term multinational. Multinational refers to business entities that own business operations in more than one country. Therefore, he defines global marketing as business entities that operate across different borders, whose marketing strategies varies from country to country (Van Mesdag, 2000, p. 75).

Global marketing is a specific form of cross-border marketing which, in its unadulterated form, does not exist. Basically global marketing has a wide scope (geographically) and strives to homogenize marketing strategy in different countries (Van Mesdag, 2000, p. 75). Most of the marketing strategies at the present are still based for the most part on culture-sensitive adaptations in different markets across borders.

The geographical, cultural, linguistic, and regulatory differences among countries are so immense that using harmonized marketing mix is almost impossible. Still, global marketing always strive to harmonize all aspects of marketing mix as much as possible (Nina & Simintiras, 2000, p. 3).

Culture sensitivity in Global Marketing

There are numerous definitions of culture; however, the term culture is normally used to depict a decisive process. According to Gullien & Garcia –Canal (2009, p. 24), culture refers to shared values, attitudes, and behaviours that are passed on over time in a steady, but vibrant process. Nobody is born with culture; rather it is acquired through interaction with the surrounding.

The most significant aspect of culture is the fact that it is an ingenious process that is hard to comprehend its effect on values, attitudes and behaviours. Cultural shocks, at times, may cause psychological disorientation because they may lead to misunderstanding and negative feeling (Gullien & Garcia –Canal, 2009, p. 25).

Since international marketing entails contact and movement of goods, services and ideas across borders, appreciation of cultural diversity is very essential ((Hofstede, 1991, p. 4). Most studies on global marketing focuses on how local cultures affect companies’ practices in the host countries.

Domestic cultures may be considered to be values, attitudes, norms, and perception orientations characteristic of members of a given society. Introduction of systems and practices that are inconsistent with the local culture can result in failure of the system, not to mention conflicts between the company and its clients and possibly, the stakeholders at large (Usunier & Lee, 2005, p.61).

According to De Mooij (2005, p. 8), multinational companies have always found it hard to establish, develop, and maintain successful long-term relationship with far-off clients. He stresses that the success of any business in the global market depends on its ability to overcome cultural barriers and maintain long-term relationship with the clients.

Therefore, cultural sensitivity plays a very big role in building long term relationship with the clients. Most studies have been conducted to establish the relationship between cultural sensitivity and ethnocentrism. These studies have been based on relationship quality between exporters and their foreign importers (Jap, Manolis & Weitz, 1999, P. 303).

According to Smith (1998, p. 76), relationship quality entails general evaluation of strengths and level of relationships that meets the expectation or needs of the parties involved based on historical successes/failures. Strong collaborative relationship between transnational companies and clients helps in minimising effects of stiff competition in the current global environment (Pulendran, Speed & Widing, 2003, p. 379).

The collaborative relationships strongly depend on relationship quality, characterized by high level of commitment, approval, trust, and nominal exploitation. Commitment, satisfaction, trust and minimal exploitation are the principle dimension of relationship quality. The above key dimensions have been supported strongly by numerous relationship marketing literatures (Smith, 1998, p. 77).

Usunier & Lee (2005, p. 13) states that cultural sensitivity entails responsiveness, cultural understanding, minimization of cultural bias. Nina & Simintiras, 2000, P. 3) defines cultural sensitivity as a company’s learning and adaptation to foreign business environment/ practices.

A few studies have explored the relationship between relationship quality and cultural sensitivity (Harich & LaBahn, 1997; Usunier & Lee, 2005, p. 13.

Cultural sensitivity not only refers to cultural adaptation but also great concern for the consumer’s wellbeing. These tend to enhance trust among companies and their clients and as a result companies are able to overcome business challenges in foreign environment (De Mooij, 2005, p. 10).

A study conducted by Kraft and Kae (1992, p.60) on the perception of Korean importers to Japanese and US industrial goods, found out that the rating of these goods were based on cultural sensitivity. The study concluded that cultural sensitivity in that particular case could be improved through increasing awareness of the Korean culture, trade regulations and negotiation patterns.

These initiatives would enhance the relationship between US/Japanese exporters and Korean importers. According to Pulendran, Speed and Widing (2003, p. 380) defines cultural sensitivity as the company’s capability to customize its approach to culture. They stress that cultural sensitivity starts with company’s knowledge of cultural difference between it and its foreign associates.

Multifaceted Dimensions of Cultural Sensitivity

Some studies on effect of cultural sensitivity on the nature of global relationships have regarded cultural sensitivity as a single-dimensional construct (LaBahn & Katrin, 1997, p. 30; Skarmeas, Constantine & Bodo, 2002, p. 760). However, most studies view cultural sensitivity in a multi-dimensional perspective (Hartmut & Stottinger, 2001, p. 598; Shankarmahesh, Ford & La Tour, 2004, p. 424).

Based on wider literature coverage, key dimensions to cultural sensitivity are open-mindedness, adaptation tendencies, local business experience, global business experience, on going experience, and negotiation style (LaBahn & Katrin, 1997, p. 31; Skarmeas, Constantine & Bodo, 2002, p. 762; Hartmut & Stottinger, 2001, p. 598; Shankarmahesh, Ford & La Tour, 2004, p. 425).

Open-mindedness refers to the receptiveness of the marketing agents/ sales representatives to foreign information and new developments including cultural differences. This the only dimension identified by LaBahn & Katrin (1997, p. 30). Open-mindedness is tied to individuals acting on behalf of the company in the foreign markets.

It entails the ability to appreciate cultural differences, empathizing with local norms, and working styles. Therefore, ethnocentric attitude is undesirable for individuals working or operating in a foreign environment.

Many studies show that people from different cultural backgrounds tend to misinterpret each other because of their cultural differences. Therefore, an open-minded individual is best suited in such scenario (LaBahn & Katrin, 1997, p. 31).

The ability to adapt business style is significant in ensuring global marketing success (Cravens & Piercy, 2006, p. 33). Business adaptability depends with the ability and predisposition of its representatives in the foreign country. Adaptation of style of business is normally motivated by objective of minimizing cultural differences and increasing acceptance in the foreign market.

Business adaptation results in achievement of company’s targets with bare minimum challenges and mix-ups that may arise as a result of cultural differences.

Sales representatives must adapt their marketing approach to a wide range of marketing situations and in accordance to the consumers’ responses (Kotler & Armstrong, 1991, p. 121). Additional qualities required for individual adaptations include business etiquette and adherence to business procedures (Cravens & Piercy, 2006, p. 33).

Keegan (2002, p. 145) argues that adaptive marketing is synonimous with problem solving aproach. Problem solving approach denotes negotiation style that focuses on exchange of information and collaboration with foreign partners.

Negottiation is our case refers to the process of overseeing global relationships and resolving differences that may arise. Just like business style, netotiation style should also be adapted in accordance with the prevailing conditions (Kotler & Armstrong, 1991, p. 75). Global negotiations are among the most challanging tasks for transnational companies.

This is because they involve extremely culturally sensitive circumstances. They are not only based on the legal and business requirements of the host nations, but also on the quality of relationship between the exporter and the importer (Keegan, 2002, p. 146).

Most global marketing literatures focus too much on company’s experience. However, what is most important is the experience of the marketing staff in the foreign countries (Hartmut & Stottinger, 2001, p. 599). Experience is different from objective knowledge (classroom knowledge) since it is acquired through interaction with different stakeholders.

Both types of knowledge are important in global marketing. For instance, objective knowledge can be used to collect and analyze data that are vital in future decision making.

However, objective knowledge does not provide more insight on how to conduct business in foreign country. Many studies have established that objective knowledge is less significant in the process of globalizing marketing (Hartmut & Stottinger, 2001, p. 600).

Ongoing business experience refers to the time interval of a business in progress and the experience acquired in relation to particular aspects of the business in question. Global marketing representatives through interactions may acquire advanced knowledge in specific areas. Ongoing business experience may also entail experience on how similar businesses are run in the foreign land (Keegan, 2002, p. 146).

On the other hand, local experience is experienced acquired through partnership with local businesses dealing with similar products or services. Extensive knowledge of the local scenario is very important to succeed in such markets (Keegan, 2002, p. 147).

Lastly, global experience refers to wider experience of a particular multinational corporation given its massive exposure to diverse cultures and countries (Hartmut & Stottinger, 2001, p. 602). Companies with huge wealth of experience can deal with numerous numbers of challenges.

Similarly, individuals with global experience are those who have been exposed to many markets and have enough experience to tackle any form of challenge in the global market. Global experience enhances an individual’s understanding and knowledge that cuts across different cultures and business environments (Hartmut & Stottinger, 2001, p. 600).

Marketing Disney Theme Parks

Walt Disney is an example of multinational corporations that uses both ethnocentric and adaptation approach. The term ‘Disneyization’ refers to the process through which Disney tradition and culture are incorporated in the society. Disneyization involves interlocking consumption with institutional principles, advertising, theming, and staff development and training (Johnson, 1991, p. 38).

Theming is the most significant aspect of Disneyization. There are numerous themed recreational facilities, which draw on famous and accessible cultural themes. At the present, Disney themes have been adapted to the local settings. This has created a strong connection between the park facilities and attractions and the environment in which it is located (Johnson, 1991, p. 39).

Disney ‘lands’ (distinctive subdivisions in the park) have been presented through structural design, scenery, costuming, live entertainment, attractions, products and food and beverages that reflects the local/regional cultures and historical/national sites (Davis, 1996, p. 404).

Dedifferentiation of consumption denotes the broad-spectrum trend whereby the forms of consumption and institutional principles are interlocked together and increasingly become very hard to differentiate.

Dedifferentiation of consumption mostly involves linking local products and foods stuff with Disney cartoon characters. This is common in many European restaurants. Some of them have even attached themselves to the opening of the new Disney theme parks by offering free gifts to the visitors (Davis, 1996, p. 407).

The company’s Studio and Entertainment division also plays a significant role in marketing the theme parks. They have produced and distributed animated action films, music recordings, and home entertainments with local and regional contents. Use of local and regional scenes, music and culture has made the citizens of different countries to feel like being part of the larger Disney family (Clave, 2007, p. 18).

Lastly, the company normally takes huge risks by spending greatly on human resource training and development. Business executives analyze innovation as one of their top most challenges.

Innovation in this case refers to upgrading the human resources to meet the new challenges posed by the dynamic global economy. In addition, Disney also practices staff rotation where employees do not spend more than five years in one station. Therefore, Disney boosts of staff with global and local experience (Clave, 2007, p. 22).

Conclusion

Global marketing involve operation across borders where marketing strategies varies from country to country. Since international marketing entails contact and movement of goods, services and ideas across national borders, appreciation of cultural diversity is very essential. Cultural sensitivity plays a very big role in building long term relationship with the clients.

Therefore, most multinational corporations normally strive to balance between cultural sensitivity and ethnocentrism. Based on wider literature coverage, key dimensions to cultural sensitivity are open-mindedness, adaptation tendencies, local business experience, global business experience, on going experience, and negotiation style.

References

Clave, A. (2007). The global theme park industry. Oxfordshire: CABI.

Cravens, D., & Piercy, N. (2006). Strategic marketing, 8th edn, Boston: McGraw Hill.

Davis, S. (1996). The theme park: global industry and cultural form. Media Culture and Society, 18, 399-422.

De Mooij, M. (2005). Global Marketing and Advertising: Understanding Cultural Paradoxes. Thousand Oaks: Sage Publications.

Gullien, E., & Garcia –Canal, E. (2009). The American model of the multinational firm and the new multinationals from emerging economies. Academy of management perspectives, 23(2), 23-35.

Harich, R., & Douglas, Douglas L. (1998).Enhancing international business relationships: a focus on customer perceptions of salesperson role performance including cultural sensitivity. Journal of Business Research, 42, 87-101.

Hartmut, H., & Stottinger, B. (2001). International Marketing Managers’ cultural sensitivity: relevance, training requirements and a pragmatic training concept. International Business Review, 10, 597-614.

Hofstede, G. (1991). Cultures and organizations: Software of the mind. New York: McGraw-Hill.

Jap, SD., Manolis, C., & Weitz, BA. (1999). Relationship Quality and Buyer-Seller Interactions in Channels of Distribution. Journal of Business Research, 46, 303-313.

Johnson, R. (1991). A strategy for service-Disney style. Journal of Business Strategy, 12, 38-43.

Keegan, WJ 2002, Global marketing management, 7th edn, New Jersey : Prentice Hall.

Kotler, P & Armstrong, G. 2001, Principles of marketing, 9th edn, Eaglewood Cliffs, New Jersey :Printice Hall.

Kotler, P & Armstrong, G 1991, Principles of marketing, Englewood Cliffs, New Jersey: Prentice-Hall.

Kraft, FB., & Kae, HC. (1992). Korean importer perceptions of US and Japanese industrial goods exporters. International Marketing Review, 9 (2), 59-73.

LaBahn, DW., & Katrin, RH. (1997). Sensitivity to national business culture: effects on U.S.-Mexican channel relationship performance. Journal of International Marketing, 5 (4), 29-51.

Nina, R L., & Simintiras, A. (2000). Establishing cross-national equivalence of the customer satisfaction construct, EBMS Working Paper, 2000/7.

Pulendran, S., Speed, R., & Widing, RE. (2003) Marketing planning, market orientation and business performance. European Journal of Marketing, 37(3), 476-497.

Shankarmahesh, M N., Ford, JB., & La Tour, MS. (2004). Determinants of satisfaction in sales negotiations with foreign buyers: perception of US exports executives. International Marketing Review, 21(4/5), 423-46.

Skarmeas, D., Constantine, SK., & Bodo, BS. (2002). Drivers of commitment and its impact on performance in cross-cultural buyer-seller relationships: the importer’s perspective. Journal of International Business Studies, 33 (4), 757-83.

Smith, B. (1998). Buyer-Seller Relationships: Bonds, Relationship Management, and Sex-Type. Canadian Journal of Administrative Sciences, 15 (1), 76-92.

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The purpose

Internet pose of the report is to undertake a feasibility study of countries in Africa, the Middle East, and Asia to establish their suitability for the establishment of Disney Studio. Owing to the increasing costs in developed countries, Disney Studio seeks to expand its operations into developing countries in Africa, the Middle East, and Asia.

Disney studio searches for developing countries, which have minimal barriers to actors and directors in the film industry, offer cheap skilled labor, have stable and reliable sources of energy, have no legal barriers, have a stable government, own established infrastructure, and uphold favorable human resource policies. The objective of the report is, therefore, to analyze five countries in Africa, the Middle East, and Asia that meet the stated criteria that Disney requires.

The Selection of Countries

To select these countries, the report examined the film industry and assessed the degree of competition. Since competition is a major factor that would influence the feasibility of the studio, the report chose countries, which offer minimal competition to Disney Studio. Moreover, the report selected countries that have well-established legal and physical infrastructures that support international enterprises. The report also considered technology level and economic growth in the selection of these countries.

The objective of this report is to outline the profile of South Africa, Kenya, the United Arab Emirates, Malaysia, and the Philippines with a view of undertaking feasibility for the establishment of Disney Studio and finally offer a final recommendation as to which country is the most suitable.

South Africa

Search criteria

The report used the following steps in selecting South Africa as one of the countries in Africa. The search criteria that lead to the selection of South Africa is that Disney requires a country in Africa, which is on the robust economic path to development.

The country must have stable economic and political environments that support the establishment of multinational companies. Regarding pertinent resources, the country must have adequate skilled labor for the film industry, advanced technological development, and established communication infrastructure. The country must also have enough and reliable sources of energy to drive the film industry.

South Africa meets the above criteria because it is an economic hub in Africa with bustling film industry and an impeccable investment portfolio. The economic state of South Africa is favorable because its economic growth is robust and favorable to multinational companies. England states that the film industry is booming in South Africa because investors have flooded the lucrative film industry (par. 10). In essence, South Africa has produced many major films, therefore, making it a favorable and a lucrative choice for Disney.

In the legal aspect, South Africa offers limited barriers to investors, and the government supports foreign investments. In the aspect of labor, South Africa has highly skilled labor in the film industry owing to the advancement of the film industry. Moreover, the country has adequate infrastructure, advanced technical capacity, and favorable weather all year round.

General stability analysis

Currency inflation issues

The inflation rate in South Africa fell to 3.9% in February 2015. The country has heavily invested in an effective regulatory infrastructure, financial market, and financial institutions to mitigate the negative effects of inflation and encourage investments.

Political map and potential problems

South Africa has a relatively stable political situation characterized by an effective democratic system considered as the best in Africa. It has an advanced legal infrastructure, which supports good governance and business ethics.

Recommendation

Disney should have a legal adviser to ensure that it operates within the confines of prevailing business laws and regulations.

Entry and strategic decisions

South Africa offers a tax reduction of 20% for film production costs of about $1.3 million and a further tax reduction of between 22.5% and 25% in post-production costs exceeding $166, 000. Therefore, these offers form an easy entry point for Disney in terms of the initial investment.

Input scarcities

Skilled employees

The number of skilled employees is insufficient because the South African film industry relies heavily on foreign filmmakers, who have enormous projects (England par. 22). Thus, the scarcity of employees is a challenge that Disney Studio would face.

Pertinent resources

Given that South Africa is a newly developed country, it experiences scarcities in pertinent resources such as advanced equipment, modern studios, and reliable internet, which hinder the growth of the film industry.

Energy Issues

Increasing demand for coal and fossil fuel in generating electricity and the unsustainability of these sources are the energy issues that South Africa is struggling to overcome. These energy issues would affect the establishment of the Disney Studio in South Africa.

Infrastructural Issues

Inadequate transport infrastructure is a major issue that affects economic progress in South Africa. Moreover, insufficient housing and offices for businesses is a hindrance to the establishment of Disney Studio.

Human Resources Management

Given that skilled employees are limited, human resource management requires to hire expatriates to supplement the local labor force. The human resource management must comply with the requirements of the minimum wage, as well as other related regulations such as minimum working days, annual holidays, maternity leave, and other time offs.

Kenya

Search criteria

To pick Kenya, the report used search criteria, which consider the economic stance of Kenya in Africa. Moreover, the report considered the availability of skilled labor, which Disney can recruit and maintain cheaply.

Since regulations influence the establishment of businesses, the report considered favorableness of business laws. Infrastructural facilities such as communication networks, transportation networks, and availabilities of offices are other criteria that the report considered. Ultimately, the report used the criterion of the developmental stage of the film industry.

Analysis of the search criteria stated above shows that Kenya meets them. Essentially, Kenya is a lucrative country and an economic hub in East Africa. Kenya meets the search criteria because it has no stringent laws and regulations, which restrict the movements of people.

As a middle-income economy, Kenya encourages foreign investors to invest in the country and offers incentives to potential investors. In addition, facility acquisition is quite easy and cheap. The local film industry is in its formative stages, and thus, the labor market is potentially untapped. In this view, Disney can obtain enough labor and experience minimal competition.

General stability analysis

Currency stability issues

The inflation rate in Kenya fell to about 5.61% in February 2015, which shows that the country is set on the path to economic development. The Kenyan currency is relatively stable and supports foreign investments at minimal risk.

Political map and potential problems

Kenya has a relatively stable political environment when compared to other African countries because it respects human rights and offers freedom of speech. The government has made the investment process simple and transparent, as it is keen on attracting foreign investors at all costs.

Recommendation

Nonetheless, hiring a lawyer to offer legal advice is vital in ensuring compliance with all business requirements.

Entry and strategic decisions

Undoubtedly, Kenya has a huge base in the workforce because of the advancement in the education system. Therefore, investment in the country inclines towards a capital-intensive approach, where a lot of resources are necessary for the acquisition of facilities, equipment, machinery, and vehicles.

Input scarcities

Skilled labor

Kenyan has a scarcity of skilled employees because it is a developing country with few learning institutions that support the film industry. Moreover, expatriates are scarce because they are in high demand.

Pertinent resources

Since Kenya is a developing country with competitive markets, Disney will experience some input scarcities in pertinent resources in the aspects of technological equipment, appropriate tools for the film industry, and reliable internet.

Energy issues

Kenya relies on fossil fuels and hydroelectricity as the major sources of energy (Onuonga 307). These sources of energy are prone to be scarce because fossil fuels are subject to global markets, while hydroelectricity depends on the availability of rain.

Infrastructural issues

Poor transport infrastructure, scarcity of strategic offices, vulnerable energy infrastructure, and meager internet infrastructure are some of the infrastructural issues that Disney is likely to experience.

Human resource management

In Kenya, Disney would require to hire expatriates to supplement the local skilled workforce. Kenya has complex and stringent laws and regulations of employment. Employees must earn a minimum wage as directed by the government, as well as receive various benefits, including social security and health benefits. Moreover, employees are entitled to an annual leave of thirty days on a yearly basis.

The United Arab Emirates

Search criteria

In the selection of the UAE, the report compared the countries in the Middle East and used the criterion of economic development. In essence, the report selected the UAE based on the level of economic development, the degree of infrastructural development, the availability of skilled labor, political stance, legal structures, and the capacity to support foreign investments. Moreover, the report considered the availability of reliable and adequate sources of energy and technology advancement.

Based on the aforementioned criteria, the UAE qualifies one country in the Middle East. Evidently, the UAE is one of the richest countries in the Middle East, which drives the global economy. Assessment of infrastructure shows that the UAE has a modern infrastructure of transport and communication.

Regarding skilled labor, the UAE owns a large number of expatriates in the film industry. Owing to the monarchical system, the political environment is calm and stable. Moreover, Dubai is a global hub of investments because of the strategic and lucrative business opportunities.

General stability analysis

Currency stability issues

As of January 2015, the inflation rate of the United Arab Emirates was at 3.7%. The country is economically stable with no major disturbances in the financial market and institutions, thus making it a viable country for investment.

Political map and problems

The political climate is quite calm because it is under a monarchical system, which offers limited political rights and civil liberties. Hence, Disney has to operate within stringent regulations and laws.

Recommendation

To survive in a manageable environment, Disney should consult a local lawyer who will be able to offer the right advice on issues related to human resources.

Entry and strategic decisions

Investment in the United Arab Emirates is labor-intensive because a high percentage of the workforce comprises expatriates.

Input scarcities

Skilled labor

The United Arab Emirates is a developed country with skilled local labor and a large set of expatriates, who occupy a considerable part of the labor market.

Pertinent resources

The UAE has scarcities in pertinent resources such as housing, offices, and the internet.

Energy issues

Fossil fuel, which is a non-renewable source of energy, is the major source of electricity. However, the UAE has enough and reliable electricity.

Infrastructural issues

The UAE has a well-developed transport infrastructure in terms of roads, railways, and airports (Amrik, Brian, and Hawas 502). However, congestion owing to the overwhelmed transport system is an issue. Additionally,

Human resource management

Disney requires to hire expatriates because they are highly skilled. However, the importation of labor complicates the employment process, as obtaining visas, work permits, accommodation, and transportation are difficult. Employment laws indicate that employers must provide all these requirements for the employees, thereby making the process quite expensive.

Malaysia

Search criteria

In the selection of countries in Asia, the report searched for a country that stabled economically and politically. Moreover, the report considered a developing country with a favorable investment climate for foreign investments. The availability of adequate labor was also a factor that the report considered in the selection of the country.

Since infrastructure plays an important role in the film industry, the report considered the transport and communication infrastructure. Technological advancement and the state of the film industry were other significant criteria that the report used in selecting a favorable country.

Analysis of countries in Asia using the above criteria indicates that Malaysia qualifies. Fundamentally, Malaysia is one of the most vibrant economies in South-East Asia, which is politically and economically stable with considerable industrial growth. Malaysia has a favorable business environment because it is an economic powerhouse in the region, which has an open market that attracts foreign investors and has no major restrictions on border control. The film industry is developing, thus providing an opportunity for Disney to exploit.

General stability analysis

Currency instability issues

In February 2015, the inflation rate in Malaysia was 0.1%. Such an inflation rate means that it has a credible level of economic stability, which is quite suitable for investment. As the Malaysian government encourages film production and content development, it offers various incentives to both local and international film producers in a bid to turn Malaysia into a film production center.

Political map and problems

Malaysia exercises a monarchical political system, whereby a monarch comes only from the nine Sultans and rules using both common law and sharia law.

Recommendation

Compliance with common law and sharia law is necessary, for they stipulate business regulations and ethics.

Entry and strategic decisions

Disney requires to invest intensive capital because of the competitive Malaysian markets. However, it is relatively easy to set up a studio in the country due to the availability of a highly-skilled labor force, as well as the modernized infrastructural base.

Input scarcities

Skilled labor

Although skilled labor is sufficient, emerging competition in the global labor markets is likely to cause a scarcity of skilled employees in Malaysia.

Pertinent resources

Developing a communication network, insufficient housing, and competitive strategic offices are some of the pertinent resources Disney would be struggling to achieve.

Energy issues

Although Malaysia produces sufficient electricity, it is dependent on fossil fuels, which are subject to fluctuating global forces of the economy (Oh, Pang, and Chua 1246).

Infrastructural issues

Malaysia is still grappling with infrastructural issues such as poor road networks, evolving communication infrastructure, and inadequate housing.

Human resource management

Malaysia has a relatively sufficient skilled labor force; however, it is a multi-cultural society with different rights to the employees. Hence, it is very important to include cultural and religious issues when dealing with human resources.

Philippines

Search Criteria

The report considered the level of economy in selecting a country in Asia, which Disney can establish its studio. Given that infrastructure in terms of transport, communication, and housing are pertinent resources for Disney, the report used them in selecting a favorable country. Moreover, the report considered the availability and reliability of electricity as a driver of information technology. The availability of adequate skilled labor is another criterion that the report used in choosing the appropriate country in Asia.

Among other countries in Asia, the Philippines meets the above criteria. Essentially, the Philippines is a flourishing economy with a notable business hub, which attracts investors. The Philippines also has advanced infrastructure in transport, communication, and housing, which are pertinent resources for Disney. Since the thriving film industry has been in existence for many generations, it has created a pool of skilled labor. The Philippines produces various major films and short stories enjoyed throughout Asia and other regions.

General stability analysis

Currency stability issues

The inflation rate in the Philippines fell to 2.5% in February 2015, making it a favorable location for foreign investment.

Political map and problems

The political system of the Philippines is democratic, but it has unfavorable rules and regulations, which support high taxation rates and exploitation of employees.

Recommendation

Human resource issues in the Philippines that require consideration include tax-exempt, compensation programs, trade unions, and collective bargaining.

Entry and strategic decisions

Disney should take advantage of the highly skilled labor force, as well as an advanced infrastructural level, which supports the film industry. The film industry enjoys a lot of support from both the government and the public.

Input scarcities

Skilled labor

The Philippines have challenges in the recruitment and retention of highly skilled labor, particularly in the film industry, because of immense job opportunities.

Pertinent resources

The Philippines has scarcities in pertinent resources such as the internet, housing, technology, and modern equipment for the film industry.

Energy issues

The Philippines experiences a frequent shortage of energy, which has created an energy crisis in the past few years. Moss (4) reports that the shortage of electricity owing to increasing demand led to the energy crisis in 2014.

Infrastructural issues

As a developing country, the Philippines still grapples with infrastructural issues such as poor roads, inadequate housing, and developing communication infrastructure.

Human resource management

Since the Philippines have a highly skilled workforce, human resource management should offer an attractive package to recruit and maintain employees according to the prevailing stringent rules and regulations.

Final Recommendation

South Africa is the best choice for the establishment of Disney Studio. The country enjoys a very stable economic and political situation that is highly conducive for investors. In addition, South Africa has a highly skilled set of film crews, actors, technicians, and other relevant technical operators. The country has advanced technical capacity, adequate infrastructural level, and favorable weather all year round. South Africa has produced many major films, therefore, making it a favorable and a lucrative choice for Disney.

Works Cited

Amrik, Moza, Sohal Brian and Fildes Hawas. “Transportation infrastructure development in the UAE.” Construction Innovation 12.4 (2012): 492-514. Print.

England, Andrew. Booming film industry boosts South Africa’s economy. Financial Times. 2014. Web.

Moss, Trefor. “Philippines power crisis: The battle to keep the lights on.” The Wall Street Journal 112.33 (2014): 1-8. Print.

Oh, Tick, Shen Pang, and Shing Chua. “Energy policy and alternative energy in Malaysia: Issues and challenges for sustainable growth.” Renewable and Sustainable Energy Reviews 14.4 (2010): 1241-1252. Print.

Onuonga, Susan. “The relationship between commercial energy consumption and gross domestic income in Kenya.” The Journal of Developing Areas 46.1 (2012): 306-314. Print.

Disney difference refers to a high class innovative strategy that aims at optimizing the value of contents in markets and other business platforms. It is backed by the relevant strategies that will see the Disney Company reap high profits from selling its literature. The whole business strategy employs great ideas that are profit oriented.

Disney Company uses the Disney difference to ensure that its products are unique and of a high quality. The videos and books produced and introduced to the market by Disney Company are highly valued by the buyers due to the employment of the Disney difference. This way the corporate image is enhanced in the market and almost the whole market remains glued to the Disney products.

Thus, Disney Company ends up having the largest market share. The company can charge higher prices on their products and their customers will not complain but they will even be willing to purchase more of those items as they are the best in the market. The growth of Disney as a corporate body will be at a high rate due to the huge profits generated from the large market share associated with the company.

The uniqueness of the arts brought about by the Disney difference puts them at the top of a very competitive market. Most of their competitors tend to produce normal entertainment items that have nothing new and unique while Disney does all that it can to produce unique items. This ensures that Disney Company does not suffer from the strong competitive forces in the market.

Disney remains highly regarded in the market. The Disney difference strategy is one of the best strategies that if guarded well by the management will see the company rise to greater heights of success. The language barrier is one of the major problems that Disney Company is likely to face as a result of introducing the business in China and Russia.

As a matter of fact, most of the inhabitants of China and Russia do not speak English while Disney Company produces and sells most of the entertainment items in English language. It will be difficult to convince non English speakers to buy English literature. To counter this challenge, Disney can engage its personnel and some few inhabitants of the two places in translating the videos and books to the native languages of the two places.

This way most of the occupants of the two places will understand the literature and purchase it, otherwise the business will hit a snag. Management is another major challenge that the company is likely to face as a result of introducing business in China and Russia.

The business will have expanded and the managerial team will have to do more work. Hence, the company will be forced to employ more managers to curb this problem. The new managers should be vetted to ensure they are highly skilled and should then be distributed to the new business places with at least an old manager to be their supervisor.

It means that Iger views himself as the person who introduced the Disney difference policy that led to a major comeback of the Disney Company to the entertainment sector. Yes, it is part of being a strategic leader as it sets precedence for the junior managers and those to come after him.

They will always try to match his shoe and that way they will formulate better policies, evaluate the effectiveness of those policies and see them implemented to the letter. This way the Disney Company will always remain at the top.

The Walt Disney Company is a global brand. The company is active in several business areas such as film and entertainment, operation of parks and resorts, and the running of media networks. The company is in the process of making acquisitions. In fact, the company’s expansion in the last ten years has come from the acquisition of various businesses aimed at strengthening the ability of the company to fulfill its mission. The latest acquisition by the company is the buying of Studio Ex (Takahashi, 2012). Studio Ex is a South Korean game maker that will help Disney to establish its presence in Asia and the gaming market (Takahashi, 2012). This acquisition shows that Disney is interested in developing a global presence and expanding its business in the gaming market. This move by Disney forms the basis of the analysis of Disney’s business strategy covered in this paper.

Strategic Choices Based on Porter’s Generic Strategies

All business decisions such as the acquisition of Studio Ex by Disney are part of an overall business strategy. According to Porter (1980), any business thinking about strategy must use a generic strategy in its thinking. Cost leadership, product differentiation, and focus are the three generic strategies.

Cost leadership is one of the two mass-market strategies (Porter, 1980). Companies operating under this strategy aim at offering goods of a given quality to the consumers at the lowest possible price (Porter, 1980). Cost leadership usually requires a combination of low margins made profitable with high volume sales. It also requires the producer to become an efficient operator in order to identify ways of lowering operating costs to bring down the price of the product.

Product differentiation is also an industry wide approach to business strategy (Porter, 1980). In this case, the company finds a unique element in its product, and uses it as a source of competitive advantage. For instance, some airlines offer no-frills services at low cost to a high number of passengers, while others aim at offering certain premium services to attract passengers who do not mind paying more to enjoy the services.

The third generic strategy is the focus strategy (Porter, 1980). Focus strategy involves the identification of a niche market, and then committing resources to serve the niche as effectively as possible. Focusing on a specific niche can make it possible to operate either as a low cost supplier, or as a premium service provider.

The acquisition of Studio Ex by Disney shows that in this particular case, Disney is pursuing a differentiation strategy. Studio Ex produces a specialized product. The games market in the world is a specialized niche. Some games attract a wide variety of casual users, but the best ones attract a selection of avid gamers. The company may also be pursuing a focus strategy targeting the high end gaming market (Takahashi, 2012). Some people are willing to spend a fortune on games. Therefore, Disney will have the capacity to serve this market through Studio Ex.

SWOT Review of the Strategic Choice

Disney’s strengths include its international image, and its reputation for innovation. The acquisition of Studio Ex will increase the presence of the company in Asia. This will increase the brand strength of the company. At the same time, the acquisition will increase Disney’s reputation as an innovative company. It will also increase the company’s ability to produce new products for the gaming market.

The weaknesses of the company are its large size, and its high sunk costs. The size of the company may lead Studio Ex to operate inefficiently of because of slow decision-making (Walker, Walker, & Schmitz, 2003). In addition, the acquisition of Studio Ex increases the overall number of employees working for Disney. The high sunk costs of the company may hinder its ability to leverage on the potential of studio Ex. Studio Ex is still young. It needs resources and space to grow. Disney may not afford to commit the resources required to maximize the output of Studio Ex.

The main opportunity that Studio Ex brings to Disney is the opportunity to join the lucrative gaming industry. The gaming market is growing across the world. Therefore, the acquisition of Studio Ex gives Disney the opportunity to become an influential player in the gaming market. Its location in South Korea also gives Disney the added advantage of operating from Asia. Asia is not just a gaming market, but also one of the most innovative regions when it comes to the development of games (BCG, 2010).

The threat posed by the acquisition of Studio Ex is that it exposes Disney to competition from established gaming companies such as the Sony Playstation Division. Disney does not have much experience in this industry and Studio Ex is a very young company.

Lessons from the Assignment

This assignment offered two lessons. The first lesson came from the opportunity to apply Porter’s generic strategies to a real life situation. The main lesson here was that the generic strategies have practical implications on the operations of organizations. The second lesson from the assignment came from the application of the SWOT analysis to the business strategy of an organization. The main point here is that a decision on strategy has several implications. There is need to consider all the angles before making any decision in regards to business strategy.

References

BCG. (2010). Creating People Advantage in 2010: How Companies can Adapt their HR Practices for Volatile Times. Boston, MA: The Boston Consulting Group.

Porter, M. E. (1980). Competitive Advantage: Techniques for Analyzing Industries and Competitors. New York, NY: Simon and Schuster.

Takahashi, D. (2012). Disney pushes into Asia with purchase of South Korea’s Studio Ex. Web.

Walker, D. M., Walker, T. D., & Schmitz, J. T. (2003). Doing Business Internationally: The Guide to Cross-Cultural Success. New York, NY: McGraw-Hill Professional.

Organizational climate is one of the most significant characteristics that describe a workplace and helps understand human behavior in any organization. Organizational climate can be defined in a colloquial or technical sense. In simple terms, it describes how a person feels when working in an organization. In technical terms, an organization climate is defined as the features of a work environment that determine the overall perception of the employees living and working in that environment, and how it influences their behavior and motivation. Organizational climate is an important area of study because it determines how employees feel and behave in an environment. Therefore, the main objective of this paper is to examine the organizational climate at Disney during the tenure of the CEO, Michael Eisner.

Michael Eisner’s management at Disney had lasted for twenty years, and it enabled him to establish a strong leadership environment incorporation. He believed that leadership was something unique to each company, industry, and group of employees. The type of organization climate at Disney during his tenure was impoverished because Eisner always avoided being autocratic. He gave the employees occasional opportunities to participate in the company’s decision-making process, although the central power still resided with him.

In addition, his management approach was based on hands-on experience, and he believed that there was no other way to lead than how he did it himself. Indeed, Eisner had four rules for leading, which he believed improves creativity, and these are: being an example, always being present, being a nudge, and being an idea generator.

The idea of being an example meant acting in a way that inspired other people to behave in a similar manner. Being present implied being there and using body language to gauge employees’ interest in certain projects. Nudging involves pushing employees or managers to an idea to improve it and test its validity. Finally, generating ideas implied that leaders were to be practical and were mandated to contribute to ideas. Therefore, they were to be ready for any criticism of their own ideas. These rules did not play out well, as Eisner expected as they contributed to the failure experienced in the company during the last periods of his tenure.

In order to improve the organizational climate, Disney needs to recognize that the most important “lever” is a manager’s own behavior. The motivation and behavior of people in a working environment are boosted by altering managerial practices, and this has the effect of improving the climate, which translates to improved productivity and increases the company’s overall performance. Moreover, Disney needs to develop a system for measuring the organizational climate. The purpose of the system should be to point out the organization’s weaknesses and evaluate the overall results.

In conclusion, it is clear that Eisner’s tenure shows how an authoritative manager can seize stakeholders’ control ability in a company. Shared values and clear visions are important aspects of strategic leadership in any organization in the world. The strategic implication of Eisner indicated the innate tendency of employees to display loyalty to an authoritative leader even when it conflicts with their legal and ethical duties. Therefore, Eisner failed to operate at the strategic level effectively, and his dismissal in the year 2004 as Disney’s CEO, through the “Save Disney” campaign, was justified.

Reasons for building Disneyland and Disney Adventure

Disneyland was opened in 1955 while Disney Adventure was opened in 2001. The construction of Disneyland was motivated by the idea of creating a unique amusement park within the United States. Walt Disney envisioned that the construction of Disneyland would attract the public, and it would later lead to the success of the business. The opening of the park was not successful, and the park received a lot of negative press reviews. The number of visitors received during that year did not meet the expectations. This had an impact on the profitability of the company. The overall performance of the theme park was dismal.

Besides, the founder was not satisfied with the rate of growth of the business. Therefore, it was necessary to improve the existing features of the company and come up with new constructions that would be more appealing to the public. Therefore, there was a need to perfect the features of the park so that the customers would feel that they get value for their money. This lead to the construction of other features such as Disney Adventure, Downtown Disney, and Disney Grand Californian Hotel and Spa. Therefore, the reasons for the construction of the two separate theme parks were to diversify the products and services offered to customers, improve customer satisfaction, and to maximize the profit earned by the company. The bottom line was to attract as many customers as possible and ensure that they stay longer at the theme parks.

Price discrimination at Disney

Disney uses a complex pricing strategy to charge its products and services. The company offers different park passes to a different group of people. An example of a price schedule for the different pass types is presented in the table below.

The table shows that the company charges different prices for the different types of passes. An evaluation of the pricing schedule shows that it is relatively cheaper for an individual to pay for the premium, annual passport than the other three because the pass holder is entitled to higher rates of discount for the purchase of merchandise and dining. Apart from the higher discount rates, a premium pass holder enjoys theme parking, unlike the other cardholders. Also, on the pricing schedule, it can be noted that the different packages are available to citizens living in certain regions. For instance, Southern California and Southern California Select passports are valid for residents living in areas with ZIP codes that lie between 90000 to 93599 only (Disney Parks and Travel 1a).

Apart from the annual passes, the company uses tickets for pricing their products and services. The two types of tickets used are Park Tickets and Park Hoppers. A Park Ticket allows a customer to visit one park in a day while a Parker Hopper allows a customer to visit more than one park. The Parker Hopper allows the customers to spend more hours at the park. The tickets are also priced differently depending on the number of days spent at the theme parks. The pricing is presented in the table below.

It can be noted that the price per day reduces as the number of days for the ticket increases. This implies that it is cheaper to pay for a 5-day park theme ticket than a 1-day ticket. Thus, it is evident that the pricing schedule is designed to encourage guests to stay longer in the park. Further, it can be observed that the company aims at raising more revenue through annual passes as opposed to the tickets because it is priced cheaply. Also, the company offers higher premium and discount rates for tickets that last for a longer duration than those that last for a shorter duration. Apart from the discounts and premiums, it can also be noted that the company makes subsequent visits much cheaper than what its competitors charge.

Based on the pricing schedule, it is clear that the company uses third-degree discrimination. This type of discrimination is a scenario where the company charges dissimilar prices for similar products in the different market segments. The company separates the market segment based on price elasticity and the inability to resell products across the different market segments. The company has been able to execute price discrimination because it understands the demographics and the ability to pay of each market segment. Through price discrimination, the company has been able to maximize revenue and profits. The company achieves this by ensuring that the price charged exceeds the marginal cost of providing the products and services. The pricing strategy has similar characteristics to monopoly pricing.

Pricing of hotels

The price range per person for the hotels is grouped into three categories. These are $0 to $15, $175 to 250, and over $250. The hotels are located in five resorts these are Magic Kingdom Area, Epcot Area, Disney’s Animal Kingdom Area, ESPN Wide World of Sports Area, and the Downtown Disney Area. The price range is based on the location of the hotel and the category of the resort. The most common categories are Deluxe Villas, Deluxe Resort Hotels, Moderate Resort Hotels, and Value Resort Hotels, among others. These categories have different characteristics. Thus, the company is able to charge different prices for the services provided in the different hotels (Disney Parks and Travel 1b).

Maximizing investment return/minimizing risk

Based on the above analysis, it is evident that the company is focusing on maximizing investment return. The company has continually improved the quality of its products and services with the intention of maximizing return. Besides, the company came up with a complex pricing strategy that allows it to practice price discrimination. The strategy is aimed at maximizing investment return.

Increasing the price rate

The price rate of the company has increased significantly over the years. For instance, 1-day one-park admission prices increased from $10.75 in 1981 to $92 in 2013. Further, it can be noted that the increase in price rate is higher than the inflation rate in the United States. The increase in the prices can be attributed to the massive capital investment in the theme parks and constant improvement of the condition of structures and features in the park (Niles 2013).

Works Cited

Disney Parks and Travel 2014a, Disney Resort Annual Passports & Prices. Web.

Disney Parks and Travel 2014b, Explore Resort Hotels. Web.

Disney Parks and Travel 2014c, Tickets and Packages. Web.

Niles, Robert 2013, Disney Announces Ticket and Parking Price Increases at Disneyland and Walt Disney World. Web.

Walt Disney is a multinational Corporation headquartered in the United States. The primary competitors of Walt Disney are Universal Studio and Six Flags. Universal Studio is a multinational company that has been expanding it business operations into new geographical segments. Universal studio plans to invest heavily in Europe to leverage the growing demand for theme parks.

Six Flags is one of the largest amusement parks based in New York and headquartered in Grand Prairie, Texas. Six Flags own some properties in Canada, Mexico and the United States. Six Flags plan to expand its theme parks into a new market segment in Mexico to increase revenues. In the long-run, the company has a strategic plan to open up new branches in France and Germany.

Walt Disney is expanding into new market segments outside the US. Disney is entering the Indian market through a licensed joint venture with Modis. Walt Disney will license the joint venture in order to penetrate the market easily. The joint venture will enable Disney to sell its products including films, toys and videos. The entry of Walt Disney in India will discourage local producers who have enriched themselves by infringing the company’s copyright.

As a result, local producers in India will be required to pay royalty fees for using Disney’s characters to gain popularity (Tribe, 2011, p. 235). Walt Disney also plans to expand its theme parks in Germany, Russia and China. Globalization has enabled Disney theme parks to leverage and seizes new business opportunities in Europe and Asia Pacific thus increases sales.

Moreover, globalization ensures risk diversification. For instance, in 2014, Walt Disney Latin American sales decline by an estimated 8.6 percent. However, the loss in market share and revenues was offset by increased market share in Europe and especially France.

Globalization is essential to promote the economic growth of Walt Disney into new market segments. Zibart (2010) argues that globalization of Walt Disney has promoted rapid expansion of the theme parks across the world (p. 26). However, it has encouraged fierce competition among enterprises in the theme parks and resort industry. In some cases, internationalization of Disney exposed the firm to new business risks.

For instance, when Walt Disney was opening its business operations in Paris, a law suit was appealed against the company. In fact, the company suffered substantial losses due to the incompatibility of workers policies with those of French employees (Mitrašinović, 2006).

Walt Disney can reduce business risk by expanding its operations in Russia. Globalization exposes Disney parks to stiff competition from sellers with homogenous goods who drive prices down. Disney parks are located in areas where competitors such as Universal Studios and Six Flags try to create market imperfection in order to have ultimate control over market share.

Russia represents a large market segment with few competitors who do not have the innovation or the creativity to compete with Walt Disney. However, this expansion will likely expose Walt Disney to new business risk and market decline (appendix 2). Moreover, the company may experience barriers to entry as the Russian theme parks industry is highly regulated. Nonetheless, if the new expansion plans succeed, Disney could increase it current revenues by a significant percentage.

References

Mitrašinović, M. (2006). Total landscape, theme parks, public space. Aldershot: Ashgate.

Tribe, J. (2011). The economics of recreation, leisure and tourism. Oxford Waltham, MA: Butterworth-Heinemann.

Zibart, E. (2010). The unofficial guide to Walt Disney World for grown-ups. Hoboken, N.J. Chichester: Wiley John Wiley distributor.

My chosen strategy for evaluation of Walt Disney Theme Parks is based on Transaction Cost Economics (TCE). This strategy is best used when a company internationalises on activities or processes that are cost productive on their operations, enabling them to have a cost advantage over the market while deducting on those which are cost deductive to their operations.

The first strategy is the use of auditing as a strategy for evaluation. Auditing is adequate, especially for a firm like Walt Disney Theme Park because, like the TCE, It helps in matters relating to international financial reporting standards. Therefore, the strategy assists firms in evaluating and obtaining evidence regarding the economic status of a given period (Klein & Sykuta, 2010).

The results are that the person in charge is assisted to make an accurate judgment on the steps or changes to make to secure their finances in accordance with the objectives or goals of the firm. Auditing strategy applies to the TCE strategy identified for Walt Disney Theme Parks because they both internationalizes activities or process that have a cost advantage over the market while taking various precautions like subcontracting on processes that are considered as a cost disadvantage to the firm.

The second strategy is contingency planning. This strategy is based on finding solutions to deal with unfavorable events before they occur. Just like the TCE, contingency planning is applicable in Walt Disney Theme Park because it also acts to remedy situations or processes, hence providing accurate information for the person concerned to take appropriate steps that are beneficial for the well-being of a company. Moreover, using the strategy of contingency planning like the TCE provides a firm with alternative plans for both events or processes that are rendered to be cost deductive.

The third approach is The Balanced Scorecard. It is a strategy that works for firms as strategy evaluation or control technique. Similar to the TCE, the balanced score card is used for identifying both financial and nonfinancial measures that are rendered to be cost advantage and cost deductive to firms. Therefore, it is applicable to the TCE strategy selected for use for Walt Disney Theme Parks because through its use, a company is capable of identifying ratios that are useful in measuring processes that are either cost advantage over the market or cost deductive in the market.

The last approach is published sources of strategy evaluation information. This strategy has been highlighted as the strategy is quite effective when applied in the TCE strategy because it works to identify the strengths, weaknesses, opportunities and threats of other competing firms.

Thus, the strategy is important because when thoroughly analyzed, it serves the functions of the TCE strategy as it imparts persons concerned with vital information that are essential to effective decision making that will ensure cost advantage to the firm (David & Greene, 2000).

Quantitative methods will be the selected method for evaluating the TCE strategy that has been chosen for Walt Disney Theme Parks. This method may include the use of methods for measuring transaction cost and the econometric analysis of contracts and organizations. However, for the case of Walt Disney Theme Parks, I will use measurement methods for evaluating the strategy. These measurement methods include the use of indirect measurement and direct measurement.

Under indirect measurement, I will use questionnaires and one on one interviews to determine such qualities like the difference between buying and selling price.

In addition, I will determine observed buyer behavior for products being produced by the firm. On the other hand, for direct measurement, I will use interviews and experiments to evaluate the processes through contracting. In addition, for the budgeting section, I will use techniques such as interviews and accounting. The table below shows how the process may be structured (David & Greene, 2000).

In addition, while conducting the evaluation, a proposed contingency plan will be structured to ensure that the steps and actions taken are sufficient for the long-term benefit of the firm (Diaz, 2006). The action plans taken for this will be as follows.

Each and every transaction will be properly spelled and abbreviated to avoid the problem of definition brought about when conducting an evaluation of TCE strategy.

Each transaction cost will be accurately separated from other expenses, such as production cost to avoid problems brought about due to problems of separation during the evaluation of the TCE strategy.

Transaction cost will be made to be moderate to prevent an evaluator from the problem of missing observations. The problem is always caused when sales cost is high, and observation of transactions always becomes difficult.

Estimation of transaction costs will be appropriate in order to prevent the evaluation process from such errors like problems of subjectivity.

Cost effective tools and processes will be used to avoid the problem of measurement costs which may arise in the process of evaluation because in most scenarios, the measurement value is always discovered to be costly to the firm.

References

David, F., & Greene, A. (2000). 9. In Instructor’s resource manual (instructor’s manual, test bank, lecture notes, transparency masters) to accompany Strategic management, fourth edition, and Concepts of strategic management, fourth edition. New York: Prentice Hall PTR.

Diaz, L. M. (2006). Evaluation of cooperative planning in supply chains: An empirical approach to the European automotive industry. Berlin: Springer.

Klein, P. G., & Sykuta, M. (2010). The Elgar companion to transaction cost economics. Cheltenham, UK: Edward Elgar.