The Role of Culture within an organization.

Disney’s long-standing culture has led the company to much success in the company’s 87 years of existence.  Through a structured hiring system, Disney recruits individuals with similar backgrounds and values.  Disney employees are referred to as “cast members” and are hired to play a specific role in a “script.”  Employees are expected to maintain an attractive, clean, and wholesome image, implying certain restrictions on dress, hair, makeup, jewelry, and other standards of personal hygiene.  Cast members are socialized in their first two days on the job through a video presentation and a “Disney Look” booklet that is distributed to every incoming employee. This packet clearly lays out the rules on how the company’s employees are expected to look and act while they are within the grounds of the park.    

Furthermore, employees are expected to smile at all times, treat customers with a friendly positive attitude, and are not to be seen smoking, eating, drinking, or out of costume.  These measures are to ensure that customers will experience the magic for which Disney is well-known.

While management is not forced to adhere to the strict appearance code or the park code of conduct, they are expected to remain focused on the “customer experience” at all times.  It is the duty of senior management to develop strategies to ensure that customers will have the experience of their lifetimes at the park.

        Despite Disney’s expansion throughout the United States and internationally, its culture has remained unchanged.  The company successfully opened parks in California, Florida, and Japan without sacrificing its hard-working attitude and squeaky clean image.  Furthermore, during these expansions, the majority of the management team and decision making authority remained in Disney’s California headquarters.  It is likely that this very remote management style was effective because the company’s committed; American-Style work ethic closely paralleled the style of the Japanese.  

Disney was able to enforce its stringent rules on food and beverage consumption within the park:  alcohol was to be forbidden on the premise, no outside food was allowed in, and the majority of the food provided at the park was American fare.  Disney felt that by offering well-known American brands in parks, the company could further uphold its “all-American image.”  Consequently, American restaurants such as McDonald’s and Kentucky Fried Chicken were opened within the park.  These establishments were prepared to turn customers at a high rate and were open for operation during the entire day.  Consumers were able to snack as they pleased throughout the day.  Historically, Disney’s lack of focus on food had been an effort to further emphasize the various magical happenings throughout the park.        

The Infusion of Disney Culture in France

With the introduction of Euro Disneyland in France, however, Disney found that these same American ideals and practices were not synonymous with those upon which the French culture prided itself.  Though it initially considered a few different locations, France was chosen for the European expansion for two main reasons:  (1) the French were willing to make many concessions in order for Disney to build the park on French soil, and (2) the close proximity of other European nations as well as heavily toured Paris.

Wanting the revenue that Disney would generate, the French agreed to reduce the Value Added Tax on entry tickets, secure subsidized loans, extend the rapid transit system from Paris to the theme park, construct highways specifically for Euro Disneyland, and agreed to settle contractual disputes outside of the French courts.  In exchange, Disney was required to make one agreement:  it would respect and use French culture in its themes.  The French attempted to make it clear from Euro Disney’s inception that culture was not something they were willing to sacrifice to American business.

From its inception, Euro Disney faced protests from many sides.  Intellectuals argued that Disney was filling children’s minds with worthless propaganda, while others claimed that the park’s American neoprovincialism was a direct attack on France’s cultural landscape.  Analysts had overestimated the number of European vacationers that would visit the park.  While Disney was challenged by a wide range of problems, the clash of Disney’s strong corporate culture with the cultures of Europe, (specifically those of France) proved to be the most threatening to the company’s existence.    

Robert Fitzpatrick, a French-speaking American that was married to a French national was elected to run the new venture.  Fitzpatrick was supposed to be a key player in establishing Disney’s credibility with the French.  He had been praised by many French journalists for his fluency in the language and for his knowledge of France’s expansive history.  While he was akin to many French customs, Mr. Fitzpatrick didn’t truly understand the French culture and how to integrate it within a conservative American company.  

After the park’s opening, European tourists quickly became agitated with the predominantly American fare offered and the long waits during dining times.  Perhaps the most appalling to the European consumer was the no alcohol rule enforced within park grounds.   Not only did the French find this rule to be a nuisance, they also saw it as a direct assault on local wine producers.  To further consumer’s annoyance, Euro Disney offered a limited number of restaurants.  Disney had difficulty realizing that the Europeans were accustomed to dining at a set time every day.  Where Americans are content to wander around the parks with lunch in their hands, a large majority of the European guests would converge on the restaurants at 12:30 p.m. expecting to be seated for a leisurely lunch.  Unprepared to handle the crowds, this created very long serving lines.  Additionally, many Europeans were accustomed to full sit-down breakfasts such as bacon and eggs.  Euro Disney offered only black coffee and doughnuts.  

Backlash against the company’s culture was not only external.  Disney found the employment process to be the most challenging.  Much controversy arose over the strict appearance codes that were universally enforced.  A training video with a shower scene indirectly suggested that employees bathe on a daily basis.  French labor unions protested that these codes were an attack on individual liberty.  Under French laws, restrictions on individual and collective liberties are illegal.  Many criticized Disney for being insensitive to French culture, individualism, and privacy.  Disney argued that these policies were critical in maintaining the company’s brand image.

 In addition to the appearance codes, Disney employees of French descent showed resentment towards the idea that they must smile and act in a polite manner at all times.  The French saw this behavior as a form of mockery and found it to be personally insulting to customers.   Many employees were unhappy with Disney’s working conditions.  Employees were expected to work long hours in relation to French norms and were offered overtime based on the aggressive American workweek.    Furthermore, many were simply unwilling to work on holidays, Disney’s prime season.

Just eight years after the opening of Euro Disney, the park was facing a possible termination of operations.  Plagued by high employee turnover, low visitor rates, and customer dissatisfaction, the company was forced to reevaluate its initial strategy or close Euro Disney’s doors.

The Creation of Disneyland Paris

   In an attempt to merge the Disney culture with that of the French, the company made vast changes referred to as “the rescue plan.”  First, Euro Disney’s name was changed to Disneyland Paris to better reflect European tastes.  Robert Fitzpatrick was removed from office and a Frenchman by the name of Phillipe Bourguignon was his successor.  Mr. Bourguignon was hired to help infuse French culture into the park and profitability into the project.

His first initiative in the turnaround was to resolve the employment issues.  The company was facing a lawsuit for the violation of French labor laws over dress codes.  As a result, Disneyland Paris restructured the French dress code so that employees’ sense of individualism would not be challenged.  Next, the company addressed the issue of working conditions.  Disneyland Paris shifted away from American working practices towards a more French approach.  This included setting a maximum work week and annualizing hourly work schedules that were agreeable with French standards.  This resulted in a workforce with a greater acceptance and willingness to be flexible.

 Disney then turned its focus toward the all important consumer issues.  After careful consideration of the implications of Disney’s clean image, the company changed its policy to allow the sale of beer and wine within the park.  Compromising the all-American aspect so tightly held in the Disney’s culture, the company also increased the amount of French cuisine that was offered at Disneyland Paris.  This included the addition of traditional sit-down venues that catered to European habits.  

The end result of its drastic cultural changes was to allow for employee and customer behaviors that better reflected the French perspective.  From the employee perspective, rather than behaving in ways to uphold the “magical” experience felt at Disneyland in the United States and Japan, they were directed and encouraged to focus on behavior that was family-oriented.  This included associating with customers in ways most common to French society, i.e., the company de-emphasized the need for perpetual happiness and smiles.  Both employees and customers benefited from this change .

Cultural Recommendation for Future Expansion – Hong Kong Disneyland

With the introduction of Hong Kong Disneyland in the year 2005, there are steps that Disney can take to ensure a smooth integration of cultures upon its entrance in China.  Similar to both American and Japanese culture, the Chinese are hard-working and focused on values.  These similarities in the culture at large will result in fewer cultural discrepancies.    

 In creating employment practices and policies, it is imperative that Disney understand that the Chinese culture is one of cohesiveness, tradition, and family-centeredness.   In consideration of the customer, the Chinese do not typically pursue physical excitement.  As a result, both the number and type of rides should be evaluated in comparison to the traditional park layout.

Also in effect on the consumer, in preparing for the initial phases of theme park construction Disney would be wise to consider the ancient rules of feng shui. Many Chinese people use feng shui as guidance in all aspects of life.  This ancient Chinese philosophy governs the spatial arrangement and orientation of objects and space.  This could include but is not limited to, the layout of buildings, rides, and the landscaping within the park. Chinese use this philosophy in the layout of cities, buildings, and various other infrastructures.  This could change the predominant focus Disney puts on the center castle and on the rides.

In addition to the possible variation of the theme park’s construction, Disney should also be strategic in the selection of management.  Similar to past expansions, the company will retain control at the corporate headquarters in Glendale, California.   However when selecting local management, it would be beneficial for Disney to localize efforts in order to have an in-depth understanding of Chinese culture and increased credibility within Hong Kong.          

      While it is likely that Disney will face fewer cultural challenges upon the opening of Hong Kong Disneyland in 2005, the company has learned that it is imperative to allow flexibility in the company’s culture.  Disney’s next move into a foreign market must be accompanied by extensive, in-depth cultural research in addition to the traditional financial analysis. Disney learned first-hand that high employee turnover and customer dissatisfaction can result if the parent company’s culture does not mesh with the expectations of their stakeholders.  By taking into account the cultural implications of the Disneyland experience on customers as well as the working environment and adjusting the culture to fit the location, the company can head off a possible repeat of their misfortune in Paris.