Harvard Case - Dubailand (A): Would the Pharaohs Have Dared?
"Dubailand (A): Would the Pharaohs Have Dared?" Harvard business case study is written by Jacques Horovitz, Anne-Valerie Ohlsson. It deals with the challenges in the field of Organizational Behavior. The case study is 14 page(s) long and it was first published on : Jun 27, 2007
At Fern Fort University, we recommend that Dubailand adopt a phased approach to its development, prioritizing projects with high potential for success and aligning them with the overall vision of Dubai as a global tourism and leisure hub. This approach involves a combination of strategic planning, risk management, and careful execution to ensure the project's long-term viability and profitability.
2. Background
Dubailand is an ambitious project aimed at creating a world-class entertainment and leisure destination in Dubai. It encompasses a wide range of attractions, including theme parks, water parks, sports facilities, and residential developments. The project is spearheaded by Dubai Holding, a government-owned investment company, with the goal of attracting tourists and boosting Dubai's economy.
The case study highlights the challenges faced by Dubailand, including the global financial crisis, the high cost of construction, and the need to attract investors and visitors. The project's success hinges on its ability to overcome these challenges and deliver a compelling experience for tourists and residents alike.
The main protagonists in the case study are:
- Mohammed Al Hashimi: CEO of Dubailand, responsible for overseeing the project's development and execution.
- The Dubai Government: The ultimate decision-maker and financier of the project, with a vested interest in its success.
- Potential Investors: Key stakeholders who will provide the necessary capital for the project's development.
- Tourists and Residents: The target audience for Dubailand's attractions and amenities.
3. Analysis of the Case Study
The case study presents a complex scenario with several key issues. We can analyze these issues through the lens of strategic management, focusing on the SWOT analysis framework:
Strengths:
- Government Support: Dubailand enjoys strong backing from the Dubai government, providing financial resources and political stability.
- Strategic Location: Dubai's location as a global hub and its growing tourism industry offer a significant advantage for Dubailand.
- Ambitious Vision: The project's scale and scope create a unique opportunity to establish Dubai as a world-leading entertainment destination.
Weaknesses:
- Financial Risks: The project's high capital requirements and dependence on external funding expose it to financial risks, particularly during economic downturns.
- Execution Challenges: The complexity and size of the project pose significant operational and management challenges.
- Competition: The global entertainment and leisure industry is highly competitive, with established players and new entrants vying for market share.
Opportunities:
- Growing Tourism Market: The global tourism industry is experiencing steady growth, offering significant potential for Dubailand to attract visitors.
- Diversification of Attractions: The project's diverse range of attractions can cater to a wide range of interests and demographics.
- Technological Advancements: Emerging technologies can enhance the visitor experience and create new revenue streams.
Threats:
- Economic Volatility: Global economic downturns can negatively impact tourism and investment, jeopardizing Dubailand's success.
- Competition from Other Destinations: Other emerging destinations are investing heavily in entertainment and leisure facilities, posing a threat to Dubailand's market share.
- Political Instability: Regional political instability can negatively impact tourism and investment, affecting Dubailand's operations.
4. Recommendations
Based on the SWOT analysis, we recommend the following actions for Dubailand:
1. Phased Development: Dubailand should adopt a phased approach to development, prioritizing projects with high potential for success and aligning them with the overall vision of Dubai as a global tourism and leisure hub. This approach allows for flexibility, risk mitigation, and a more manageable execution strategy.
2. Strategic Partnerships: Dubailand should actively seek strategic partnerships with international entertainment companies and investors to leverage their expertise, resources, and brand recognition. This approach can help mitigate financial risks and enhance the project's appeal to tourists.
3. Focus on Unique Experiences: Dubailand should focus on creating unique and memorable experiences that differentiate it from competitors. This involves incorporating innovative attractions, leveraging Dubai's cultural heritage, and offering personalized experiences for visitors.
4. Robust Risk Management: A comprehensive risk management framework should be implemented to identify, assess, and mitigate potential risks associated with the project. This framework should include financial, operational, and environmental risks, as well as political and social risks.
5. Strong Marketing and Branding: Dubailand needs a strong marketing and branding strategy to attract tourists and investors. This strategy should highlight the project's unique features, target specific demographics, and leverage digital marketing channels.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: The phased development approach aligns with Dubailand's core competencies in project management and execution, while prioritizing projects with high potential for success ensures consistency with the mission of creating a world-class entertainment destination.
- External Customers and Internal Clients: The focus on unique experiences and robust marketing caters to the needs of external customers (tourists) and internal clients (investors), fostering a positive perception of the project.
- Competitors: The emphasis on strategic partnerships and differentiation through unique experiences aims to position Dubailand competitively in the global entertainment and leisure market.
- Attractiveness: The phased development approach allows for a more manageable financial investment and reduces overall risk, making the project more attractive to investors.
6. Conclusion
Dubailand has the potential to become a major global tourist destination, but its success hinges on a strategic approach that prioritizes risk management, financial prudence, and a focus on creating unique and memorable experiences. By adopting a phased development strategy, seeking strategic partnerships, and leveraging its strengths, Dubailand can overcome the challenges it faces and achieve its ambitious goals.
7. Discussion
Alternative approaches to Dubailand's development include:
- Full-scale development: This approach involves rapid development of all projects simultaneously, maximizing the impact of the project but also increasing financial risks and operational challenges.
- Focus on a single theme: This approach concentrates on developing a single, highly specialized theme park, potentially attracting a niche audience but limiting the project's overall appeal.
The risks associated with our recommended approach include:
- Delay in project completion: The phased development approach might lead to delays in achieving the full vision of Dubailand.
- Loss of investor interest: The phased approach might not be as attractive to investors seeking immediate returns.
- Changing market dynamics: The entertainment and leisure industry is constantly evolving, and the phased approach might not keep pace with changing trends.
8. Next Steps
To implement our recommendations, Dubailand should take the following steps:
- Develop a detailed phased development plan: This plan should outline the timeline, budget, and key milestones for each phase of the project.
- Identify and secure strategic partners: Dubailand should actively seek partnerships with international entertainment companies and investors.
- Develop a comprehensive risk management framework: This framework should identify, assess, and mitigate potential risks associated with the project.
- Launch a robust marketing and branding campaign: This campaign should highlight the project's unique features, target specific demographics, and leverage digital marketing channels.
By taking these steps, Dubailand can position itself for success in the competitive global entertainment and leisure market.
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Case Description
This is the first of a two-case series (IMD328 and IMD330). The idea for Dubailand first came up in early 2002 as part of the country's efforts to diversify the sources of its gross domestic product (GDP) by expanding the tourism market offering. The answer, developed by the Dubai Development and Investment Authority, was the founding principle behind Dubailand - the creation of a globally competitive entertainment and leisure hub. Between 2003 and 2005, a master plan for the project was drafted. International theme park experts and consultants were called on to provide input as to how the land should be divided and what should be included to make the destination globally competitive. In April 2006, Christian Perdrier, current CEO (Chief Executive Officer) of Dubailand, was approached by a headhunter based in London about the Dubailand project. They were looking for someone with international experience and industry expertise to lead the project, which was not taking off beyond the master-planning phase. He accepted the challenge and joined the company in February 2007. The case is set in 2007, in the first few months after a CEO is hired to make the vision happen. Between February 2007 and December 2010, the CEO will have to turn a plan into a reality, opening a leisure and entertainment complex of 27,000 hectares, hiring the first wave of the 250,000 people who will ultimately work in a hub that will include dozens of theme parks, hotels, retail and residential units.
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