In her quest to expand operations all over the world, Disney has been involved in selecting locations for expansion to other parts of the world. Previous choices that the company had chosen including Paris, Hong Kong, and Tokyo have been quite unsuccessful. It’s with this understanding that the company seeks to find a way on ensuring that it gets it right this time.
The company seeks to choose her choices for expansion with regard to the culture. This has been a major consideration, looking at the company’s nature of business. Disney is involved in the business of Movies, TV, books and magazines, games as well as promotions.
Culture is defined as the collective make up, or programming of the human mind and that distinguishes ones human to another. It’s a patterned way of thinking, reacting or feeling towards certain aspects of humanity (Kenna & Lacy, 1994). Culture also guides the selection of appropriate responses to business, social interactions and situations.
There are various elements of culture, that impact on the business of a company. Culture’s elements such as language, political philosophy, economic philosophy, education, religion and social structure often have profound impact on the success or failure of an enterprise. These elements are important for any decision making as regards to the location of a business. This is because all these elements affect how a business performs, either directly or indirectly, and must be considered carefully before a decision is made (Gesteland,1999)..
The effect of culture affects business in a number of ways. First and foremost, culture determines consumer behaviour. Customers will tend to behave in a manner that is acceptable in a particular culture. For instance, if Disney wants to sell particular games that are not accepted in a particular culture, or even sell books or magazines that are considered to go against the culture of a given people, it’s likely that they would not be successful (Martin & Chaney, 2006). Culture also affects people’s local demand, brand image as well as buyers buying decisions. As explained, since peoples buying behaviour is influenced to a large extend by their culture, the demand for a given product would severely suffer if a company introduced a product that is not acceptable by the local culture.
Most important the culture of a people determines ‘the way of doing business ’. For instance, if people of a particular town or city for instance like to purchase things early in the morning or late in the evening, then it’s imperative that the company must understand this trend and plan accordingly (DuPraw et al ,1994) . The culture of a place also determines the management style that the managers have to adopt. The way the management of a company relates to stakeholders is more or less affected by the prevailing culture. Failure to learn and understand the culture of a people is likely to have detrimental effects on the business of an enterprise.
Finally, knowledge of the local culture is useful in dealing with the home market. In fact, it’s often argued that culture acts as a hidden barrier to entry and therefore knowledge of such culture is quite important to the success or failure of the business. Disney, in the light of this argument considers culture as a very important element in their decision on expansion.
As explained, Disney is in the business of selling movies, books and magazines, videos etc. Therefore, Disney’s decision to put culture as a major consideration in deciding where to locate their new expansion business is well in recognition of the important role that the culture of a people plays in deciding the success or otherwise of the business.
Population/market and transport
Other factors considered in Disney’s selection criteria include the availability of transport as well as a large population which would offer a consistent market. The cities of Manila, Hanoi, Goa and Colombo are known to be served by a wide network of transport system, rail, road and air, which makes these cities business hubs in their countries.
This has not only been a major push factor towards the growth of the cities but has also been a pull factor allowing for the growth of the population, and hence the markets. Disney’s future is almost guaranteed as these cities are well populated, as well has having a buying power that allows for the availability of disposable income.
The transport system allows for the transport and distribution of goods, a major pull factor for Disney in these cities. The consistent growth in population also provides a growing market, that is able to accommodate most of the Disney’s’ products. The combination of these factors is of great importance in ensuring the success of Disney, and is thus important factors to consider in Disney’s expansion plan.
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