Case Study 6-20

Almost a year after opening its newest theme park in Hong Kong, Disney (HKD) found itself mired in controversy surrounding the park, battling to overcome management missteps and struggling to meet expectations—both its own and those of the government in Hong Kong who were majority partners in the project. As a 2006 Time Magazine article states: “Hong Kong's Magic Kingdom has so far been a little short on magic. The $1.8 billion theme park, which opened last September, was touted by Disney executives as its biggest, boldest effort to build its brand in China, a potentially vast new market for its toys, DVDs and movies. The Hong Kong government which aggressively wooed Disney and is the park's majority owner hoped Disneyland would help secure the city's reputation as one of Asia's top tourist destinations. However, the conservative approach of Disney and its partner has produced a pint-sized park that so far hasn't matched visitors' lofty expectations. Hong Kong Disneyland has a mere 16 attractions only one a classic Disney thrill ride, Space Mountain compared to 52 at Disneyland Resort Paris. Meanwhile, management glitches involving everything from ticketing to employee relations have further tarnished the venture's image.” (Schuman, 2006) A 2006 survey conducted by Hong Kong Polytechnic University found that 70% of local residents had a more negative opinion of Disneyland since its opening in 2005 prompting one Associate Professor at the university to state that “Disney knows the theme-park business, but when it comes to understanding the Chinese guest, it's an entirely new ball game." (Schuman, 2006)

So just what was it that turned the majority of local residents against a theme park which employed over 15000 workers during construction, boasts 5000 permanent Disney cast members, with 13,000 related positions expanding to 36,000 positions at the end of the first phase of building; and which projects to infuse $19 Billion dollars into the local economy...