Disneyland's Value Creation Model

This assignment analyzes the value creation model of Disneyland. It explores how factors like brand recognition, innovative resources, and strategic marketing contribute to creating value for customers. The analysis delves into production processes, stakeholder management, and the role of intellectual property in maintaining Disneyland's competitive edge. The assignment also highlights the importance of service quality assurance and adapting to specific cultural contexts.

Running head: INTELLECTUAL CAPITAL MANAGEMENT
INTELLECTUAL CAPITAL MANAGEMENT
Name of the Student:
Name of the University:
Author Note:

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INTELLECTUAL CAPITAL MANAGEMENT
Answer 1. i) Disneyland Hong Kong is a project that Hong Kong government undertook in
collaboration with Walt Disney in 1997. It took five more years to finally approve Walt Disney
company to start its project in 2002 (West, 2016).
External environment: The commencement of Disneyland project had to account for several
external factors. This project was undertaken by the Hong Kong Special Administrative Region
(HKSAR). The project was approved by the government at Penny’s Bay, in Lantau island,
located a little farther from the main city. The theme park was mainly built for the ‘family
oriented’ tourists from mainland China, Taiwan and South East Asian countries. 29% of the
incoming tourists were from China in 1999. People of China face a stringent travel policies, it is
not feasible for them to travel to USA or Europe to experience theme park environment. Hong
Kong is a tourist hotspot, hence, the economy is mainly dependent on the shopping destinations
and tourism agencies. The theme park is technologically advanced with big rides and luxurious
ambiences. Many places in Hong Kong had to go through urban development project.
Disneyland project greatly affected the ecosystems of the adjacent islands (Woon & Lo, 2016).
Internal environment: Walt Disney had already opened a theme park in Europe to expand its
business. But the Disney theme park located just outside Paris did not take into account several
managerial issues as well as consumer preferences. Walt Disney found Chinese population very
lucrative and wanted to open a theme park somewhere around China. After two American parks
and one Japanese park, they wanted to avail of the Chinese market which was previously
unexplored. Disneyland, after initial talks with Hong Kong government, eliminated any other
possibility of majority ownership so that they could invest on management and fees of franchise
from their first-cut profits. Finally, Walt Disney had a management team of long experience of
dealing with almost all the large and developed markets around the world. With the unparalleled

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resources and capital they already had, they could easily conduct proper market research before
diving into the market in Hong Kong.
Strategic environment: Pricing is a big issue when it concerned Asian population. They set the
price as HK$640 for visitors but it was still beyond the reach of average visitors. The only rival
to Disneyland was Ocean Park. Ocean park was an old entertainment park, though they had
established themselves as an all rounder in Hong Kong with all sorts of rides (Higgins & Huque,
2015). The pricing was also quite affordable. The only way it could not compete Disneyland was
accommodation and dining, in both of which Disneyland was much superior.
Intellectual Capital model:
Human capital Relational (customer) capital Organisational (structural)
capital
 Firm’s know-how is
strong, with long
experience and proper
training and technical
soundness of
employees.
 Vocational
qualification of the
employees are believed
to be high since the
firm needs to maintain
superior quality
service.
 Disneyland is a brand
with huge brand value
worldwide.
 Although Asian
customers are believed
to be price-sensitive
and miser, a section of
population is very
enthusiastic. Hong
kong attracts tourists
from every part of the
world.
 Customers always
 They have design
rights for most of their
amenities.
 Their trade secret is
highly maintained and
their service is thus
very desired by
everyone.
 Trade marks and
service marks are also
a plus point for
Disneyland.
 Disneyland had

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 Since the firm has
served developed
nations for a long time,
occupational
assessments were done
properly.
 Work related
competencies are
moderately high since
majority is Asian
employees.
 Entrepreneurial
acumen is high since
they invaded a new
market, took the land’s
franchise from Hong
Kong government in
considerably profitable
settlements.
concede to the brand
value of the Disney.
 Walt Disney has very
strong connections
with all sorts of
companies, and they
innovate new
marketing strategies
with the back up from
other media channels.
 The project was
backed by government
that enabled Disney to
acquire high degree of
trust from general
mass.
 Franchising
agreements were
profitable for
Disneyland.
revolutionized family
entertainment concept
with their theme parks
concept.
 Management processes
are swift and hassle
free.
 Information and
networking is strong.
 Financial relations are
mediocre.
Answer 1. ii) IC Value Chain Analysis:
People:

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 It addresses unemployment problems employing Asian people.
 They have a Disney university to train their employees.
 Management board consisting of 5 people from HKSAR, and 4 people from TWDC.
 Stringent energy saving policies.
 Legal team is strictly focused on safety issues.
 Vivienne Tam, a renowned Chinese designer designed the known Disney characters in
Chinese attire.
Process:
 Special service is also arranged for disabled customers.
 Not just through media channel promotions, but customer feedbacks also increases
company revenues.
 Special events like Chinese new year and other local cultural events are organized to
incorporate the Chinese customers.
 Ngong Pong 360 is a local attraction with which Disneyland jointly promotes.
 There is also an ambassador of Disneyland resort in Hong Kong.
 They have a policy of taking return of their products within 30 days since purchase if the
customer is not satisfied.
 They deliver the product purchased to the customers living in Disneyland hotels.
 Hiring entertainers to entertain customers. This pertains to creative capital which is also
intellectual in some sense (Business Analysis, 2018).
Technology:
 Ride facilities.

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 Newly expanded ‘Toy story land’ is the unique Asian inclusion, inaugurated in
November 2011 (West, 2016).
 Unique Disney subway is built to ease transportation.
Content:
 Service is totally family-oriented.
 Planning for expanding the Hong Kong Disneyland project.
 Import some products from Tokyo Disneyland.
 Since 2011, night tickets or two-day tickets were introduced to give a fuller experience.
Question 2.
As a theme park of a big stature, Disneyland is aware of the importance of human capital
and intellectual capital management in sustaining the growth of their business. Comprehensive
Intellectual Capital Management model enables any company to delve into the status of
intellectual capital and how that helps them strategize in different situations so that they can
garner competitive advantage and generate revenue (Kianto, Andreeva & Pavlov, 2013).
There are chiefly three stages in which CICM model is described:
i) Knowledge management that enables creation of potential value through know-how and in-
depth knowledge which is acquired through experience. Knowledge and brainpower that need to
be employed to create values for real (Demartini & Paoloni, 2013).
ii) Innovation management which enables extraction of perceived value through product
innovation and product differentiation. This includes realization of perceived value extracting
activities.

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INTELLECTUAL CAPITAL MANAGEMENT
iii) Intellectual property management that maximize market value. This needs proper
maintenance of intellectual property like trademark services and trading secrets. Copyright is
also important factor for maximizing brand value.
There are mainly three kinds of capital at work in a company, namely, human capital, relational
capital and structural capital.
These three kinds of capital play an important role in the formation of intellectual capital in each
stage of CICM. Company assesses the rules, systems, managing techniques and strategies and
value-creating strategies to conduct a thorough strategic plan of CICM.
(Please find the CICM in the page below.)

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INTELLECTUAL CAPITAL MANAGEMENT
CICM stage Human Capital Relational
Capital
Structural
Capital
CICM purpose
Knowledge
management
(Pre-production
works about
proposal, concept,
collaborative
plans)
Managing director
is a Chinese who
had studied in a
business school in
America.
Employees are
from Hong Kong
so they are aware
of the tastes and
preferences of
local public.
Due to high brand
value, Disneyland
already enjoys a
broad fan base.
They come from
all parts of the
world for the
unique level of
service they get.
Knowledge
reservoir from
long experience of
serving families
around the world.
Creative potential
and innovations
and strategical
marketing and
promotional ideas.
Creation of value
(positive features
or USP that
attracts people to
disneyland.)
Innovation
resources and
Applied
knowledge
management
(Actual
production,
realization and
implementation of
innovative
This part needs
actual expertise in
the field. To cater
to customer needs.
To keep in mind
the complications
that arises in
different situations
and handling it.
Teamwork and
Properly handling
stakeholders. Hong
Kong public were
sensitive about the
demolition of
ecosystems that
the project had
caused (Ahn &
McKerche, 2015).
Disneyland had to
Business process
and production.
Extraction of value
due to production

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resources) proper service,
internal strategy
and proper
communication.
comply to the
environmental
issues.
Intellectual
property
management
(Post production
works that include
proper
maintenances of
trademark
services)
Disneyland
through its long
history of serving
people across the
world with their
premium services
had to keep to their
words Hong Kong
Disneyland
website(2018).
The employees
have to live up to
the expectations
for which people
are paying greater
than average price.
Product quality
assurance and
service quality
assurance.
Trade secret, trade
mark, copyrights,
design rights,
commercial value.
Maximization of
value through
procurement and
maintenance of
intellectual
property rights.

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INTELLECTUAL CAPITAL MANAGEMENT
References:
Ahn, M. J., & McKercher, B. (2015). The effect of cultural distance on tourism: A study of
international visitors to Hong Kong. Asia Pacific Journal of Tourism Research, 20(1),
94-113.
Demartini, P., & Paoloni, P. (2013). Implementing an intellectual capital framework in
practice. Journal of Intellectual Capital, 14(1), 69-83.
Headlines (2010) The loss profit of Hong Kong Disneyland 2009. Available at
http://news.stheadline.com/instantnews/news_content/201101/18/20110118a110747.html
?cat=a (Retrieved 24th February, 2018).
Higgins, C. D., & Huque, A. S. (2015). Public Money and Mickey Mouse: Evaluating
performance and accountability in the Hong Kong Disneyland joint venture public–
private partnership. Public Management Review, 17(8), 1103-1123.
Hong Kong Disneyland (2011) Press room. Available at https://www.hongkongdisneyland.com/
(Retrieved 24th February, 2018).
Kianto, A., Andreeva, T., & Pavlov, Y. (2013). The impact of intellectual capital management on
company competitiveness and financial performance. Knowledge Management Research
& Practice, 11(2), 112-122.
West, M. I. (Ed.). (2016). Disneyland and culture: Essays on the parks and their influence.
McFarland.
Woon, K. S., & Lo, I. M. (2016). An integrated life cycle costing and human health impact
analysis of municipal solid waste management options in Hong Kong using modified
eco-efficiency indicator. Resources, Conservation and Recycling, 107, 104-114.