A Cirque Du Soleil Business Case Study Analysis Ofoleta K. C. 2014 465r5m

How to cite: Ofoleta, K., C. (2014). A Cirque du Soleil business case study analysis. Knowledge Management. Academia.edu

14th May 2014

About The Author: Kelechi C Ofoleta holds a Bachelor of Science (BSc), in Computer Science/Information Systems from Victoria University of Wellington (VUW), New Zealand. He is completing Master Of Information Management (MIM) under the same institution and will be publishing more of his work at www.kogonuso.com and https://vuw.academia.edu/Kogonuso.

Leran more about the author at http://www.kogonuso.com/

A Cirque du Soleil BusinessCase study Analysis By Kelechi C Ofoleta ([email protected])

Abstract This case analysis is on Cirque du Soleil case study from Danielle Savoie’s point of view on the issue that she encountered as a Vice-President of Information Technology and Knowledge Management (KM) following her mandate to find effective ways for IT to the substantial growth planned by Cirque. It takes a pertinent look at the organizational background, and the current and future direction of Cirque du Soleil aimed at resolving the

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issues bordering the organization and recent progress made in this regard. In addition, this report sized-up the key issues and justifies why they are issues of great concern to the organization. The justifications also, reflect on the organization’s insight into these issues.

Having sized up the issues and its characteristics this report performed analytic thinking of the issues by looking at the causes and the effects on the organization, including strengths, weaknesses, opportunities, and threats (SWOT) analysis of the organization. It recommends to the organization, practical approaches and feasible strategies that have helped some successful organizations overcome similar issues and point out the potential benefits that the organization might derive if they choose to follow these recommendations. It advised that more research is required by Cirque du Soleil towards finding how IT can continue to add value to its business as it concludes. Keywords: Knowledge Management, Information Systems, SWOT Analysis, Cirque du Soleil business

Introduction Cirque du Soleil is an artistic organization with its international headquarters in Montreal. It was founded in 1984 by group of entertainers led by Daniel Gauthier and Guy Laliberte whose intention was to reinvent the concept of circus, which had barely evolved since 1800s. It recorded rapid growth following its tours in Quebec and Canada in the first few years; Cirque performed in California in 1987, in Europe in 1990 and in Japan in 1992. Prior to 2000, when Danielle Savoie became Vice-President of Information Technology and Knowledge Management (KM), the organization was employing close to 2000 people. At the time, Cirque had three permanent shows: Mystere, which had been presented at Treasure Island in Las Vegas since 1993, 0 presented at the Bellagio in Las Vegas since October 1998, and La Nouba presented at the Walt Disney resort since December 1998. Cirque du Soleil also had five tours on the road, which moved every two months. It has offices in command of managing the fixed Las Vegas, and Orlando shows and has three regional offices in Montreal, Amsterdam and Singapore - that supervises the road shows.

With the recorded success comes the issue of finding effective ways to the substantial growth planned by Cirque. This task fell on Danielle Savoie, whose first mandate was on finding efficient ways for IT to the forthcoming ample growth planned by Cirque. Despite people’s doubt on the role that information technology (IT) could play in an organization where creativity, imagination and inspiration were paramount like Cirque, she

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had to convince the top management team that IT is critical to the success of the organization. Rather than simply automating existing processes, Daniel Savoie used IT in ing

knowledge management (efficient handling of information and resources) to transform Cirque by capturing, leveraging, and transferring knowledge across processes and across projects. Presently, Cirque du Soleil is looking forward to how IT can continue to add value to its business.

Issue size-up and justification Lack of understanding the use and the requirement of IT in entertainment industry constituted the issue of resistance to IT-related change at Cirque. It was characterized by opposition by some of the staff and notwithstanding managers which were wondering about the role that information technology (IT) could play in an organization where creativity, imagination and inspiration were paramount. Some even considered IT as useless and too expensive. This issue became prominent as soon as Danielle Savoie became the VP IT and KM at Cirque. This issue is justifiable because addressing it positively will secure the buy-in of the people, especially stakeholders critical to the success of the change to the strategic direction of the company and bring about a source of competitive advantage at Cirque in order to capture, leverage, and transfer knowledge across processes and across projects.

Another issue faced by Danielle Savoie at the Cirque is on how to integrate and preserve data from various activities such as suppliers, applications, design activities and so on, such as images, videos, sketches, notes and so forth for reuse to inspire future creativity. The issue of data integration and preservation span the entire design and creative activities at cirque, especially costume-making process; make-up process and making of plaster heads.

Prior to Danielle Savoie becoming the VP IT and KM at Cirque, the costume-making process information was stored separately in different Excel files, making it laborious to manage all input and output patterns easily. Consequently, information loss was difficult to avoid despite the critical nature of this process to Cirque du Soleil since it does not involve animals in its shows. The make-up process was affected by this issue in that it was very cumbersome to manage because it was applied to the artists and recorded via 35mm photos that were kept in

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local files. The specific make-up products used along with quantities, actual make-up recipes and procedures were recorded on a form stored in large binders that make-up artists had to haul along on each tour. Similarly, making of plaster heads at Cirque was also affected by

this issue due to poor storage of information on the location of the heads. Previously, information on the location of the heads was stored in the performing artist's file, and the actual plaster heads were set in the costume workshop which was inhibitive in locating and retrieving the plaster heads as required. Mind you a total of over 1,500 heads represents Cirque's artists.

Anyhow, all these poor processes of handling information and knowledge from these various activities led to documents being lost as well as diverse inefficiencies due to the considerable amount of time spent retrieving information. Hence Danielle Savoie needs to find a solution to integrate these data in order to preserve the information and knowledge embedded in them. Finding a solution can positively the strategic direction of the company, bring about profitability, act as a source of competitive advantage, raise the morale of the company's employees, increase collaboration among different units and even enhance customer satisfaction at Cirque. Cirque du Soleil’s business is meant to be an international business not just for the US market only, hence there is the issue of how to provide a forum that places contests, special promotions, press galleries, multimedia experiences, as well as an artist and employee recruitment within everyone's reach. This is an additional issue faced by Danielle Savoie. Of course, this is justifiable in that having a centralized online presence where everyone can have access to information on shows on offer, and dates will help attract more audiences than not. Furthermore, the interaction between customers and the organization will help the business to keep reviewing its marketing strategy and extending the playful Cirque experience.

Another time critical issue that faced Danielle Savoie was how to manage various equipment and activities that are required to set up the touring show site within 30 hours. This involves about 55 trailer-loads of equipment of over 20,000 categories as part of show infrastructure. Transporting this alone is an arduous task talk of the time tag that it must be set up within in order to allow for a successful show. These activities also include managing the Travel Group, and all the logistics associated with receiving new artists from all over the world and

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facilitating the procedures for their arrival. These procedures may include plane tickets, visas, immigration papers, travel arrangements, work permits, accommodations, and even translation services, if required. With touring show being a major part of the Cirque’s

business process, there must be a workaround for these vast ranges of activities as they the touring show business process of the organization.

Issue analysis One of the most salient issues in the case was resistance to IT- related change caused by lack of understanding the use and the requirement of using IT and KM in the entertainment industry like Cirque. Soon after Danielle Savoie became the VP IT and KM at Cirque, this issue became overt. The nature of the business of Cirque's show is an ephemeral event; that is, it is existing or popular for just a short time with a lifespan of only 15 years. Knowledge of this fact gave rise to thoughts on how to preserve the knowledge involved in handling changes in the show and its personnel and further gave rise to the need to sustain and grow the earlier success recorded at Cirque. This led to the organization to evaluate the importance of IT for a company like Cirque and made a decision to hire Danielle Savoie's to find effective ways for IT to the substantial growth it planned. Danielle’s attempt to get on with introducing IT and KM at Cirque met a stiff opposition from the people in the organization. She was most affected by this issue because she was forced to secure the buy-in of the people first. Especially the stakeholders at the top management team had to be convinced that IT could be more than just a cost centre by Daniellebefore she proceeded with finding efficient ways for IT to the substantial growth planned by Cirque.

This issue could have been mitigated or handle in many ways. Firstly, the organization should have consulted with the people on the idea of using IT to the substantial planned growth, to secure the buy-in of many of the stakeholders before proceeding to hire Danielle Savoie to implement the idea. Alternatively, the organization should have made Danielle Savoie's initial task to involve securing the buy-in of the people soon after she was hired before taking her to start finding ways to use IT to the forthcoming sizable growth planned. I prefer the first solution as it would have made the transition very easy for Danielle Savoieand would have prevented unnecessary tension caused by this opposition issue. Next salient issuesfaced by Danielle Savoie at the Cirque is on how to integrate and preserve

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data from various activities such as suppliers, applications, and design activities and so on. This issue arosefrom poor data management due to recording resources and processes at Cirque that stores data independent of applications and systems making it difficult to be

accessed efficiently and even lead to loss of valuable information. Again, Danielle Savoie was therelevant stakeholder to the situation, and the Cirque staff will be affected by the decisions to be made.The solution to this particular issue is so critical because if executed well will extend as a solution for other issues with dirty data and loss of information that Cirque may experience.The constraint this placed on Danielle Savoiewas that she had to understand the best way to integrate and preserve data efficiently to the business.

As a solution, building a customized simple database enabled system could be used with emphasis on ensuring that it is integrated with hardware/ all software and running on a single platform so that every separate application that interacts with this system has a way of integrating seamlessly with it. This issue best suited IT solution given that it involves data integration and preservation. Alternatively, acquiring or developing an Enterprise Resource Planning (ERP) System to handle the data could be considered. For Cirque, I will prefer the first option because the organization is quite unique that it will benefit better from customised application than generic complex ERP. Finding a suitable online platform presence for Cirque du Soleil’s business that will link it to the worldwide audience is an issue that Danielle Savoie must view as critical to the organization’s IT and KM business sustainability strategy. This problem was caused by the fact that Cirque business has not expanded around the whole world due to limited resources, but there is the need to create the awareness of the innovative circus in order to generate more revenue to sustain the organization. Another cause was that the show involves touring around the world, hence there is the need to find a way to tell people about it, sell tickets and other stuff to them via this online media in preparation for the tour. These causes are mainly resources and related processes. The issue affects Danielle Savoie the most given her job task at Cirque. The constraint for Danielle Savoie is to work out online platform that will serve this purpose more efficiently, and the opportunities are that the world will interact with the business from this medium towards achieving the strategic objective of the organization. The business will enjoy more publicity and recognition than when its activities were only local inhibited by travel cost, geographical location, international laws and so on. The issue of managing the various activities involved to set up a touring show is one more

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salient issue sized-up that will not be analysed due to limited word count space.

S.W.O.T analysis Strength, and Weakness, opportunity, and threat (SWOT) analysis is specifically influential in demonstrating the idea that good strategy indicates enduring a fit between the external situations an organization confronts (opportunities and threats), and its own internal features (strengths and weaknesses) (Hill & Westbrook, 1997). Strengths: Cirque du Soleil’s is a big corporate image and is famous in the entertainment industry with many years of experience in a circus show. It has an innovative concept to reinvent the circus art removing the need for training animals because it has strong creation and innovation concepts and is vertically integrated as it does its design, logistics, staff recruitment and so on in-house. It has unique shows that involve only adult live entertainment. Apart from this, it has high-quality shows with original concept and has both permanent and touring shows thus achieves production diversity. Weakness: Cirque du Soleil has poor information and knowledge management. It currently has no permanent show outside Las Vegas and Orlando, uses anonymous or disguised performers, and it has no unique shows that involve only children’s live entertainment. Opportunities: it can expand to new markets, merchandise, expand to more audiences around the world, diversify themes, technology and market, establish fixed shows in other continents, offer more affordable tickets, including children. Threats: competition from the Pickle Family Circus, Big Apple Circus and so on should be kept in check. There is the possibility of entry of the market by a real competitor that will disrupt the Cirque business model. Poor resource management can harm the growth of Cirque, including knowledge preservation and transfer, competition from opera, dance, and circus shows should not be ignored too.

Recommendations  In the case of IT- related change resistance that Danielle Savoie faced, she should solve this problem by understanding the true nature of the resistance. Most of the time employees’ resistance is usually to social change that is, the change in their human relationships that generally accompanies technical change and not in the technological change itself. This will help to resolve the issue faster than second-guess the solution.

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People-related resistance is difficult issue to manage, but once the cause is understood

the solution becomes easy. Quiz the opposition politely to get first-hand information on the cause of the resistance, and act to resolve it.  Danielle Savoie should pay attention to data management and integration processes as well as the resources at Cirque in order to reduce information loss and increase collaboration, data retention and knowledge retention efficiency. Deriving business value from information assets depends on the effective use of data-management technologies and best practices. A key individual componentsto pay attention include data integration, data quality, database management systems, data warehousing and enterprise information management, especially with regards to costume-making process, make-up process and making of plaster heads.  Danielle Savoie should use the knowledge of web 2.0 to determine the web technology and type of online platform to the sales and information display and gathering that will Cirque and ensure that the database at the back-end of the platform is integrated to the custom system recommended above. This will ensure that both online and offline application have some form of a link for continuous information acquisition, storage and so forth towards ing the mobile nature of Cirque Business.  Although the issue of managing various equipment and activities to get the touring show set up was not analysed, it will be worth recommending that these times critical activities that must be completed within 30 hours before the show start to be built into bundles of related components. Even components that can be set up permanently while still portable to be transported around the world should be put together this way, though it may mean modifying the components for the purpose. This will see to the separate components forming bundles being in proximity to the technicians who set up the ‘tour village’, thus reducing the time required to set up and dismantle the categories of equipment. 

Based on SWOT analysis of Cirque, moving forward stronglyrequires that diversify its product line to give customers a new experience with every show. As Cirque expands its business globally, it must bear in mind that value system varies, and as such it needs to investigate the values of the people that the touring show it going to

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meet. Using the findings, they are now deg a show that will be palatable to the values and culture of the people. This will mean that the people will accept the show and even look forward to on coming shows than when a generic show designed for

another culture is offered to a different culture.

Conclusions Cirque du Soleil is an artistic organization with its international headquarters in Montreal. It was founded in 1984 by group of entertainers led by Daniel Gauthier and Guy Laliberteaims to reinvent the circus show, especially removing the use of trained animals in the show. Cirque shows were successful, but it needed to use IT and KM to extend the lifespan of its shows beyond projected 15 years. It invested heavily in IT despite initial stiff opposition from some of the employees. Danielle Savoie’s technology and KM strategy have significantly ed Cirque’s business growth, but the trend is slowing and the organization needs to diversify to keep ahead of its competitors. Certainly, Cirque’s SWOT analysis shows that it needs to do more, and the recommendations should be followed, and more research is required by Cirque du Soleil towards finding how IT can continue to add value to its business in the future.

Bibliography Hill, T., & Westbrook, R. (1997). Swot analysis: It's time for a product recall. Long range planning, 20, 46-52. Rivard, S., Pinsonneault, A., & Croteau, A. (2011).Information Technology at Cirque du Soleil: Looking Back, Moving Forward.Thirty Second International Conference on

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Information Systems