Hong Kong's Ocean Park: Taking on Disney SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Hong Kong's Ocean Park: Taking on Disney
Ocean Park was the only amusement park in Hong Kong until 2005, when Hong Kong Disney exploded onto the scene. Outlines Ocean Park's history and its response to Disney's encroachment into its market. Ocean Park acted swiftly and decisively to capitalize on the excitement generated by Disney, thus turning what could have been a threat into an opportunity. In terms of business-level strategy, the park moved to accentuate the differences with Disney rather than compete head-on. As the CEO stated, "We have no intention of trying to out-Disney Disney." The park focused on its aquarium, animals, and thrill-rides as opposed to the "fantasy" and animated characters that make up Disney's core competence. By following this strategy, the park was able to capture a large portion of Disney visitors that came from Mainland China. Also discusses a recent restructuring, human resources management issues, and other challenges that the park faced in 2006.
Authors :: Michael N. Young, Donald Liu, Derek Au, Karen Hung
Swot Analysis of "Hong Kong's Ocean Park: Taking on Disney" written by Michael N. Young, Donald Liu, Derek Au, Karen Hung includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Park Disney facing as an external strategic factors. Some of the topics covered in Hong Kong's Ocean Park: Taking on Disney case study are - Strategic Management Strategies, Human resource management, Marketing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Hong Kong's Ocean Park: Taking on Disney casestudy better are - – increasing transportation and logistics costs, geopolitical disruptions, talent flight as more people leaving formal jobs, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China,
banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Hong Kong's Ocean Park: Taking on Disney
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hong Kong's Ocean Park: Taking on Disney case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Park Disney, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Park Disney operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Hong Kong's Ocean Park: Taking on Disney can be done for the following purposes –
1. Strategic planning using facts provided in Hong Kong's Ocean Park: Taking on Disney case study
2. Improving business portfolio management of Park Disney
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Park Disney
Strengths Hong Kong's Ocean Park: Taking on Disney | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Park Disney in Hong Kong's Ocean Park: Taking on Disney Harvard Business Review case study are -
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Park Disney digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Park Disney has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Superior customer experience
– The customer experience strategy of Park Disney in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Park Disney is one of the most innovative firm in sector. Manager in Hong Kong's Ocean Park: Taking on Disney Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Park Disney has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Hong Kong's Ocean Park: Taking on Disney - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Park Disney is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Park Disney is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Hong Kong's Ocean Park: Taking on Disney Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Park Disney is one of the leading recruiters in the industry. Managers in the Hong Kong's Ocean Park: Taking on Disney are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Park Disney has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Park Disney to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Park Disney is present in almost all the verticals within the industry. This has provided firm in Hong Kong's Ocean Park: Taking on Disney case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to lead change in Strategy & Execution field
– Park Disney is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Park Disney in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Park Disney is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Michael N. Young, Donald Liu, Derek Au, Karen Hung can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Successful track record of launching new products
– Park Disney has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Park Disney has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Sustainable margins compare to other players in Strategy & Execution industry
– Hong Kong's Ocean Park: Taking on Disney firm has clearly differentiated products in the market place. This has enabled Park Disney to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Park Disney to invest into research and development (R&D) and innovation.
Weaknesses Hong Kong's Ocean Park: Taking on Disney | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hong Kong's Ocean Park: Taking on Disney are -
No frontier risks strategy
– After analyzing the HBR case study Hong Kong's Ocean Park: Taking on Disney, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Park Disney is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Hong Kong's Ocean Park: Taking on Disney can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Park Disney needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Hong Kong's Ocean Park: Taking on Disney HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Park Disney has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Park Disney has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Slow decision making process
– As mentioned earlier in the report, Park Disney has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Park Disney even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Hong Kong's Ocean Park: Taking on Disney, in the dynamic environment Park Disney has struggled to respond to the nimble upstart competition. Park Disney has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Park Disney has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, firm in the HBR case study Hong Kong's Ocean Park: Taking on Disney has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Park Disney 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Park Disney has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Park Disney supply chain. Even after few cautionary changes mentioned in the HBR case study - Hong Kong's Ocean Park: Taking on Disney, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Park Disney vulnerable to further global disruptions in South East Asia.
Opportunities Hong Kong's Ocean Park: Taking on Disney | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Hong Kong's Ocean Park: Taking on Disney are -
Better consumer reach
– The expansion of the 5G network will help Park Disney to increase its market reach. Park Disney will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Park Disney can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Park Disney to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Park Disney in the consumer business. Now Park Disney can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Park Disney has opened avenues for new revenue streams for the organization in the industry. This can help Park Disney to build a more holistic ecosystem as suggested in the Hong Kong's Ocean Park: Taking on Disney case study. Park Disney can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Park Disney can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Learning at scale
– Online learning technologies has now opened space for Park Disney to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Park Disney can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Park Disney can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Developing new processes and practices
– Park Disney can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Park Disney can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Park Disney has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Park Disney in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Threats Hong Kong's Ocean Park: Taking on Disney External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hong Kong's Ocean Park: Taking on Disney are -
Consumer confidence and its impact on Park Disney demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Stagnating economy with rate increase
– Park Disney can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Environmental challenges
– Park Disney needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Park Disney can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Park Disney in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Park Disney will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Hong Kong's Ocean Park: Taking on Disney, Park Disney may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Increasing wage structure of Park Disney
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Park Disney.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Park Disney needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Park Disney has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Park Disney needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Park Disney business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Park Disney is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Park Disney in the Strategy & Execution sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Park Disney high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Weighted SWOT Analysis of Hong Kong's Ocean Park: Taking on Disney Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Hong Kong's Ocean Park: Taking on Disney needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Hong Kong's Ocean Park: Taking on Disney is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Hong Kong's Ocean Park: Taking on Disney is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Hong Kong's Ocean Park: Taking on Disney is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Park Disney needs to make to build a sustainable competitive advantage.
