Value Chain Analysis of Hong Kong Disneyland - Strategic Management

1. Value Chain Analysis
Hong Kong Disneyland
Carrie & Som

2. Company Background
Grand opening : 12 September 2005
It is the fifth (5th)Disneyland style park
Located on reclaimed land in Penny’s Bay,
Lantau island
New joint-venture company: Hong Kong
International Theme Park, which formed by
Hong Kong Special Administrative Region
Government & Walt Disney Company

3. Value Chain Analysis
Michael Porter, 1985

4. Value Chain Analysis Pros
A tool to analyse the value of what a company does
Useful to create the greatest possible value for your customer
Capture the fact that company does a series of function (operation,
technology development etc.)
Analyse how these functions are done relatively to their competitors
Helps to identify the ways in which you create value for your
customers, and then helps you think through how you can maximize
this value: whether through superb products, great services, or jobs
well done.

5. Value Chain Analysis
In practical applications, the regular
modeling frustration appears
Difficult to relate the graphical presentation
of the value chain with the one of value
system
The analysis practical to analyse company
better on the company that produce goods
products than the service company

6. Hong Kong Disneyland

7. Primary activities
Operation
Hire entertainers to entertain customers
Environment is build up for entertaining
the customers
Special service arrangement for disability
customers

8. Primary activities
Marketing and Sales
Not only through the advertisement in the newspaper but also
the ‘passing words’ of its customers, which gave a good
feedback of the company
Night tickets / 2 days tickets (since 26 July, 2011)
Special events for festivals and occasions; Chinese new year
etc.
Joint promotion with local attractions; Ngong Pong 360
Ambassador of Hong Kong Disneyland Resort

9. Primary activities
Service
Family-oriented
Purchasing products from Disney can be
return in 30 days if the customer is not
satisfied.
Delivery service for the products purchased
in the park deliver to the customer’s hotel
(Disneyland hotels)

10. Support activities
Infrastructure
Planning - Hong Kong Disneyland expansion
The management board has both Hong Kong SAR
governments and the Walt Disney company (5 from HK,
4 from TWDC)
Energy saving policy (offices & rides)
Safety first/ legal team

11. Support activities
Procurement
Some Disneyland products can be found in others
Disneyland such as Walt Disney World (Design
can be use in others countries)
Import some of products from Tokyo Disneyland
Vivienne Tam, Hong Kong fashion designer
designed the Chinese costume for the characters

12. Support activities
Human Resource Management
Recruit Asian employees, especially those Hong
Kong citizens and Filipino citizens. Therefore, it helps
the unemployment problem in Asia
Managing Director : Andrew Kam - Hong Kong
citizens (Originally was an American MD)
‘Disney university’ to orientate and train the staffs
every year

13. Support activities
Technology Development
Rides facilities
New expansion ‘Toy Story Land’ which is
the first in Asia (Nov, 2011)
Keep developing, expansion the parks
Unique Disney subway (easy to reach)

14. Conclusion
They develop their own strategy all the time
They learn from their mistakes
Focus on local communities (get more
attention)
They reduce their loss profit and also the
attendance increasing every year
The average spending in the park in

15. Recommendation
Hong Kong Disneyland should change their
strategy focus from China market to be more in
other countries in Asia, especially India market
Re-consider the increasing price strategy; too
expensive compare to competitor, Ocean Park
Keeping up with the marketing strategy, which is
effective

16. References
Business Analysis. System modeling laboratory lams (2010). Available at http://
lams.epfl.ch/reference/businessanalysis [Accessed on September 9, 2011]
Headlines (2010). The loss profit of Hong Kong Disneyland 2009. Available at
http://news.hkheadline.com/instantnews/news_content/
201101/18/20110118a110747.html?cat=a [Accessed on September 10, 2011]
Hong Kong Disneyland (2011). Press room. Available at http://
www.hongkongdisneyland.com [Accessed on September 10, 2011]
NetMBA Business knowledge center (2002-2010). The Value Chain. Available at
http://www.netmba.com/strategy/value-chain/ [Accessed on September 11, 2011]
Thinking made easy; business, marketing, management (2010). Strategic
Analysis of Hong Kong Disneyland. Available at http://
ivythesis.typepad.com/term_paper_topics/2010/06/strategic-analysis-of-
hong-kong-disneyland-.html [Accessed on September 10, 2011]

17. Thank you for your
attention