Problems in the Management of Euro Disney - Case Study Example

Case study Introduction Effective cross-cultural management necessitates scrupulous consideration of key cultural elements that define specific business environments. Therefore, when developing their business strategy or approaches, businesses or organizations operating in the global environment have to put into account the key cultural elements of the business environment that they operate in (Thomas, 2009). The Euro Disney case study describing difficulties of Euro Disneyland’s operations in France provides a good example of how effective cross-cultural management is crucial to the success of businesses. Basically, the case study depicts cross-cultural dimensions and values and how they practically impact on cross-cultural management (Phatak et al, 2005).The key aim of this paper is to analyse cross-cultural differences and their effect in international business collaboration. Firstly, using Geert Hofstede’s cultural dimensions this paper will highlight the cultural differences between France and the United States. Moreover, using Hofstede’s cultural dimensions, it will critically analyse the performance of Euro Disneyland in managing their operation. In this regard, this paper will discuss some of the key mistakes made by the company in its operations and provide recommendations on how these mistakes could have be avoided or addressed. Cultural differences between France and the US There are many cultural differences between France and the US. Hofstede model on cultural dimension offers a suitable framework that can be used to identify the cultural differences between these two countries. Hofstede’s model accentuates that there are five dimensions of national culture. These dimensions include; Power Distance Index (PDI), Individualism, Masculinity, Uncertainty Avoidance Index (UAI) and Long-Term Orientation (LTO). Power Distance Index (PDI) is the first cultural dimension in Hofstede’s model. According to Hofstede, PDI is the degree in which inequalities exists and are accepted in a particular society (Hofstede, 2001). With reference to the case study, it is apparent that France has a higher PDI than the US. In France, inequalities exist and are accepted. As evident in the case study, their management is high-handed in nature. Nevertheless in the US, equal rights are emphasised on, hence their management style is participative in nature. Individualism is the second cultural dimension in Hofstede’s model. Hofstede defines individualism as the degree in which individual or collective relationships are reinforced within a particular society. From this case study, it is apparent that US has an individualistic culture whereas France has a collectivism culture. In the US people mainly focus on their needs and that of their families. On the other hand, in the French culture people tend to be more loyal to their communities and show more concern for issues affecting their society. For example, in the course of Euro Disney establishment the French people, communists, intellectuals and farmers among many others strongly protested against the establishment of Euro Disney mainly because it would promote consumerism and individualism (Phatak et al, 2005). Masculinity is the third cultural dimension in Hofstede’s model. Hofstede generally considers masculinity in terms of gender roles. In this case, masculinity refers to masculine values such assertiveness, competition and a drive for success and achievement (Hofstede, 2001). As compared to the French, Americans have a more masculine culture. A key drive in the American culture is financial achievements. Hence, the establishment of Disney land in Anaheim, California and Orlando Florida received a positive reception from Americans mainly because it promised foreign exchange, employment opportunities and other lucrative opportunities. In contrast to the American culture, the French have a feminine culture. The French are more driven by a need for quality life with regards peace, security and good health. Hence, the establishment of Euro Disney was protested due to the fact that it was bound to contribute to individualism, traffic congestion, consumerism and noise pollution thus diminishing the quality of life in Marne-la-Vallee (Phatak et al, 2005). Uncertainty Avoidance Index (UAI) is another cultural dimension in Hofstede’s model that refers to the degree in which members of a particular society feel threatened and avoid uncertain ambiguous and unknown situations (Piepenburg, 2011). The French have a higher UAI than Americans. Americans have a high tolerance for uncertainties thus they are often quick to embrace new ideas and experiences. For example, American embraced the establishment of Disney land in Anaheim, California and Orlando Florida. Conversely, the French have a high avoidance index for uncertainties thus they tend to ensure certainty through rigorous planning and details. As a result of a high UAI in the French culture, they did not fully embrace the establishment of Euro Disney mainly because they were uncertainties with regards to how it would impact on the French culture (Phatak et al, 2005; Hofstede & Bond, 1984). Problems in the management of Euro Disney The opening of the Euro Disneyland in Marne-la-Vallee, France was not as successful as expected due to the use of ineffective cross cultural management practices. One of the mistakes made by the company is the lack of consideration of the French culture when it comes to the implementation of its management practices and its overall strategies. Basically, Disney world is an American concept that characteristically touches on core American values and cultural elements. Nevertheless, in the course of establishing Euro Disney in France, the company failed to adapt crucial dimensions of the French culture and values. Based on Hofstede’s cultural model, it is evident that the French and American cultures are different in terms of their Power Distance Index (PDI), Individualism, Masculinity and Uncertainty Avoidance Index (UAI). (Hofstede, 2001; Hofstede & Bond, 1984). In this regards some of the mistakes made in the management of Euro Disney’s operation include; incorporating a layout that has an exclusive American theme, imposing an alcohol ban and a strict appearance code for the employees working in Euro Disney. These practices are not in line with the French culture whereby wine is often a crucial social prerequisite and imposing a strict appearance code is considered as a breach of collective and personal liberties. As a result, Euro Disney was considered by the French as a tool for cultural imperialism mainly because it portrayed the American culture as more superior than the French culture. Key elements and values of the French culture were sidelined in favour of the American culture (Phatak et al, 2005). Moreover, the company made a mistake by not involving French national in influential management and leadership roles. The company reserved the top management and leadership roles to US expatriates and as a result, they were not able to efficiently understand the French culture and the needs of the French market. In addition to this, the company made a mistake by employing public relations strategies that are not compatible with the French culture. The public relations strategies used by the company depicted masculine values rather than feminine values this in turn impeded on the company’s public image. For example, in order to develop a positive public image the company decided to provide free trips to Disneyland in Florida to local children. This public relations strategy proved to be ineffective (Phatak et al, 2005). Recommendations Euro Disneyland should make an effort to understand and appreciate the various dimensions of French culture in order to address the various oversights made and to avoid repeating the same in future. First, the company should enhance its public relations image by showing awareness and sensitivity to French cultural dictates. There are various cultural dimensions presented in Hofstede’s cultural dimensions theory which is a useful framework for understanding cultural diversity which can provide Euro Disney with a better understanding of French culture and aid in the development and effective utilisation of effective cross-cultural management principles and practices (Hofstede 2001). This involves drawing on the key dimensions of French culture such as feminism value, collectivism and a high uncertainty avoidance index in developing the company’s public image as a localized, culturally sensitive and appropriate business. For example, the company should initiate public relations campaigns promoting Euro Disney as a platform that showcases French history and cultural heritage. Euro Disneyland should also ensure that French nationals take over the day to day running of Euro Disney. The rationale is that it is important to involve local community professionals in the day to day running of Euro Disneyland due to awareness of and deep understanding on the cultural prerequisites and needs of the local people. This will enable the company to meet the needs of the French market while developing a positive public image (Thomas, 2009). It is also important for Euro Disneyland to incorporate French culture as a factor in its decision making and operations. Management practices at Euro Disneyland should therefore be consistent with French cultural norms and practices. Company culture should reflect and be consistent with various French social conventions and cultural norms as a sign that the company appreciates and values French cultural forms of expression. This can be achieved through a policy of adherence and observance to norms on etiquette, food, appearance and dress code and working hours (Thomas, 2009; Hofstede 2001). References Hofstede, G. & Bond, M. (1984). Hofstede’s culture dimension: An independent validation using Rokeach’s value survey. Journal of cross-cultural psychology 15(4), pp.417-433. Hofstede, G. (2001). Culture consequences: comparing values, behaviours, institutions and organizations across nations. London: Sage. Piepenburg, K. (2011). Critical Analysis of Hofstede’s model of cultural dimensions: To what extent is his finding reliable, valid and applicable to organizations in the 21st Century? Munich: GRIN Verlag. Phatak, A., Bhagat, R. & Kashlak, R. (2005). International management: managing in a diverse and dynamic global environment. New York: McGraw-Hill/Irwin, Case study pp. 170 - 181. Thomas, D. (2009). Cross-cultural management: essential concepts. New York: Sage Publications. Read More