The Walt Disney Company was founded in 1923. The main goal of Disney was to deliver quality entertainment for all ages. The first resort that Disney opened was in Anaheim, California, in July 1955. The success of the first park caused Disney to open its second park in Lake Buena Vista, Florida, in 1971. The continued success of these two parks in the United States caused Disney to seek out international success. Disney anticipated that there would be continued success by "bringing the original Disneyland model to new territories, and then, if feasible, adding a specialty theme park."

Disney began the venture of internationalizing its theme park operations with the opening of Tokyo Disneyland in 1983. This park is regarded as one of the most successful amusement parks not only in the Disney operating parks but in the world. Disney’s highly successful operation in Tokyo meant that there could be the international success outside the United States. Disney attempted expansion in France which was the largest consumer of Disney products outside of the United States. In 1992, Disney opened Disneyland Resort Paris. However, the park was much less successful than its counterpart in Japan. This case explores Disney's efforts to open its third park outside the United States; Hong Kong Disneyland.

The case outlines the experiences of Tokyo and Paris Disneylands. The case provides details of the ups and downs with the opening of Hong Kong Disneyland. including the finances of the deal, and how the operations, human resources management, and marketing were incorporated to complement the Chinese cultural environment. The case also discusses the tourism industry in Hong Kong and some problems that were encountered during the first year of operations.

On December 10, 1999, the Hong Kong government officially signed a contract with Disney to build a Disney theme park, resort hotel, retail, dining, and entertainment facilities. The new facilities were scheduled to open in 2005. The cooperation took the form of a joint venture between the Hong Kong government and Disney in a 57% to 43% equity structure. The joint venture company called the Hong Kong International Theme Parks Ltd was incorporated to manage the development and operation of the park. This case analysis will provide evidence and support why the construction years and the first year of operations were a Disney disaster.

The SWOT analysis provides a great deal of insight of how Disney capitalized on the strengths in growing the business in Hong Kong. A major strength was the Disney appeal to the Chinese culture. "Chinese consumers wanted to connect with the global popular culture and distance themselves from their previous collective poverty and communist dictate." Disney thought it would be great to expand into Hong Kong because of the high demand from the Chinese people and the growing economy in that part of the world. Disney did their homework before expanding into this area. Hong Kong provided a gateway into China because of the reputation as an international financial center and a world-class infrastructure.

Disney learned from their previous experiences in developing and opening a park in other countries by catering to the Chinese culture. This was one of Disney major strengths in expanding into Hong Kong. Disney used Feng Shui Masters as a consulting firm to ensure all the cultural values were maintained in proving the best experience to its customers. Hong Kong Disney characters and staff spoke in three different languages to provide an experience to all visitors. The languages were English, Cantonese, and Mandarin. Disney also went further into cultural history by having good luck ceremonies on new construction projects, constructing the main ballrooms to be 888 square feet because of the significance of eight representing good fortune. Some other examples were skipping the fourth floor in hotel construction because four is associated with bad luck, selling mooncakes during the Chinese Mid-Autumn Festival and not selling green hats because of the symbolic meaning of a wife’s infidelity.

The human resource management is another significant strength of Disney. Disney is a recognized leader in training, leadership development, benchmarking and cultural change for business across the globe. Disney sent 500 cast members to Orlando, Florida to learn about the magical Disney culture and to share their Chinese cultural experience with other cast members at Walt Disney World. During the cast members stay, they were trained on the standards that applied to providing the ultimate experience to the customers. The cast members also were given the opportunity to work in other division to gain experience in diversifying their expertise.

The last strength of Disney in expanding into Hong Kong was the growing economy in Hong Kong. The growing economy meant that tourism travel into Hong Kong was continually growing. This also meant that Disney would provide jobs to be able to anticipate growing the economy. The growing economy led to the partnership between Disney and the Hong Kong government. This partnership enabled Disney to create a venture in expanding into Hong Kong with the local government.

There are two weaknesses with Disney in this case. The first weakness is the overcrowded theme park. " The park faced several public relations problems during its first year of operations, none bigger than that which occurred during the popular Chinese Lunar New Year holiday period." Disney had a hard time recognizing the amount of time mainland China had off for the different holidays. Disney had an influx of mainland China tourists during the first year of operations because of their inability to recognize the different holiday schedules. This caused a public nightmare where Disney had to close its gates because they could not accommodate the amount of tourist that bought tickets for the part for the last two days of the Lunar Holiday period.

The another example was the size of the park versus the amount of tourist that purchased tickets. The complaint was that the park was too small with not enough attractions to accommodate the demand of the tourists. A number of tourists also had an impact on the overall experience within the park. There were many complaints filed because of the inadequacy of the staff. The staff could not fulfill their obligation to provide the best experience to the crowd.

The other weakness was the working conditions of the workers within Hong Kong Disney. Many workers complained that they were overworked and underpaid. There was discrepancy between the pay off the characters and parade performers which caused a political nightmare for Disney. Disney had no other choice than to modify the pay structure along with providing longer breaks to ensure that workers were happy with the conditions. The worker’s complaints resulted in the high turnover which drove up operational costs to continually train new workers.

The main opportunity for Disney’s venture in Hong Kong was the tourism industry. "Hong Kong was notable for its unusual blend of East and West, of Chinese roots and British colonial heritage, of ultramodern sophistication and ancient traditions, is one of the most diverse and exciting cities in the world" "In 2005, the total number of visitors was more than 23 million, a new record and approximately a 7.1 percent increase over 2004." This increase was a big opportunity for Disney to take advantage of. There were popular attractions already in Hong Kong that helped drive the tourism increase. Hong Kong was continually opening and reinventing itself to drive the customer demand for more entertainment. Disney found this to be inspirational in expanding its operations into Hong Kong.

The opportunity of tourist demand of local attractions could also be a sign of threats. The major threat in Disney’s rearview mirror is Ocean Park. Ocean park was a local attraction that opened in 1977 and was located near Hong Kong’s Central district which is at the heart of the city. Ocean Park drew record amounts of customers ranking as one of the top 10 amusement parks in the world. Create your vacation planning with scratch off the world map. Ocean Park’s revenue continually is expanding because of the high demand and increased expansion which was financed by a government guaranteed portion. Ocean Park’s admission ticket along with ride expansion plays a very important role in the competition between Disney and Ocean Park. Ocean Park’s expansion seeks out to blend entertainment with education elements.