Assignment Body

Analysis of the case: Cirque du Soleil

VISION: A strategic vision describes the route a company intends to take in developing and strengthening its business. It lays out the company’s strategic course in preparing for the future. A strategic vision portrays a company’s future business scope (‘where we are going or headed”) In this case founder’s Philosophy was “Business can be as much fun as creating a show” So Firm creating more fun will go to make more money.

Strategic intent: The Cirque Du Soleil had created a new category of live entertainment with its unique hybrid of music, dance and acrobatics. Future growth headed both artistic and commercial way since people were looking for artistic entertainment. Since Cirque experience reached its saturation point after certain time, the firm introduced shows with a new vision of urbanity, overflowing with optimism and happiness.

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Analysis of the case: Cirque du Soleil

Mission: Cirque Du Soleil’s mission was to enable clients to maximize their entertainment lively by developing and innovating circus show. In a nutshell we aim to "arrange the circus in a modern way.

They did this by providing their audience with excellence in the own supply mechanism, continuous HR training, performer’s skillness, varieties of shows and new amazing ideas. The provision of sophisticated circus show was the primary concern of Cirque Du Soleil and they feel this to be of paramount importance to the long-term mission of the company.

Core Values: We identify in the case of Cirque Du Soleil to define 7 values about the firm’s future strategic course; Confidence: The firm’s founder took 100% risk as a challenge with no advance money initially for having high confidence in his performance. Quality: Show was so attractive for its quality that it became ten year rule show and later on spending money more to keep the show of the highest quality.

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Analysis of the case: Cirque du Soleil Uniqueness: The characteristic in the show called worm was unique and after that decided not to make a profit in order to develop a new show. Social Responsibility: 1% of ticket sales revenue donated to outreach programs designed to aid the development of disadvantaged children. Safety: The firm took initiative to ensure the safety of its performers for lower injury rate compared with foot ball match.. Creativity and innovation: Cirque Du Soleil made their decisions based on artistic and creative criteria instead of industry benchmarks and ratios. Laliberte, President searched talents at major sporting events and trained them in different languages and reinvented other venues to create an environment that would enhance and extend the cirque experience.

People treated as partner: it decentralized HR operation from country to country and introduced people with 25 different languages. However, the idea seemed simple to find partners to put up with the money and expertise.

GOAL: A goal or objective is a desired result a person or a system envisions plans and commits to achieve—a personal or organizational desired end-point in some sort of assumed development. Many people endeavor to reach goals within a finite time by setting deadlines.

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Analysis of the case: Cirque du Soleil It is roughly similar to purpose or aim, the anticipated result which guides reaction, or an end, which is an object, either a physical object or an abstract object, that has intrinsic value.

Approach/avoidance goals Not all goals are directed towards approaching a desirable outcome (e.g., demonstrating competence). Goals can also be directed towards avoiding an undesirable outcome (e.g., avoiding the demonstration of incompetence to others). It is thought that approach goals contribute positively to intrinsic motivation whereas avoidance goals do not.

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Analysis of the case: Cirque du Soleil Sometimes it is extremely difficult to stay on track with your major goals. The big ugly goals that just seem so huge it is impossible to see the full path to achieving them are the ones that most people end up just losing track of.

Many people are guilty of trying to tackle their goals using a series of trial and error approaches. They randomly throw their energy out with all their might on the few steps they know, thinking that this will get them to their goal. They deal with their goals in a haphazard approach, then hope that everything will turn for the best in the end. While it may work in the short-run and on smaller goals, it does not work with big, long-term goals. There are 7-part series on what it takes to successfully achieve goals. •

Part 1: Goal Achievement: Introduction

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Part 2: ESPER

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Part 3: Establish

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Part 4: Strategy

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Part 5: Planning

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Part 6: Execution

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Part 7: Review Here Given case study called - CIRQUE DU SOLEIL: CAN IT BURN BRIGHTER.

Chairman or Owner Mr. Laliberte was a great creative leader in terms of artistically & commercially. He had great potential for creation in his mind from the childhood. That’s why at the age of fourteen he ran away from home and started busking the city street.

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Analysis of the case: Cirque du Soleil Mr. Laliberte used to follow above seven key factors to gain the goal. First he formed one club & made arrangement to perform & please former provincial premier Rene levesque and then he established CIRQUE DU SOLEIL. He turned Impossible into a possible manner.

In year 1987 CIRQUE DU SOLEIL was about to broke but Mr. Laliberte followed the Business strategy and spent his last pennies to play the Los Angles Art Festival to success & Sustained the CIRQUE DU SOLEIL. He established & proved the plan he made, it was completely correct path. It was a great achievement or goal For Mr. Laliberte and his CIRQUE DU SOLEIL that since CIRQUE DU SOLEIL founding, over 37 million people have seen a cirque show in over 90 cities around the world. Today over 7 million people per year see one of cirque’s nine productions. The goal was achieved by Mr. Laliberte although the cirque has been an unqualified financial success. At the same time it has garnered critical acclaim, notably prestigious emmy, drama desk, rose d’or de montreux, and National Arts Centre Awards. Mr. Laliberte wanted to present the different flavor in front of the world viewer’s that’s why the CIRQUE DU SOLEIL blends opera, dance, theatre and circus with live Music, world class choreography and state of the art pyrotechnics. Mr. Laliberte always wanted to achieve the goal Globaly that’s why the employee-first attitude in HR does not stop at the contortionists or the acrobat, rather, it spreads through the entire company so much so that in 2002 Cirque won the WORKFORCE Magazine Optimas Award in the Global outlook category, which recognize an HR department that has created a program or strategy to help a company succeed in the world marketplace.

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Analysis of the case: Cirque du Soleil CIRQUE DU SOLEIL was always wanted to create a unique position in the local and world market – the harvest goes to prepare the over 450 meals served daily in the cafeteria, and any surplus is given to staff and local residents. For its decision to set up its headquarters in this controversial area, Cirque was awarded the city of Montreal’s “ Orange Prize” Financial goal was great for CIRQUE DU SOLEIL – With estimated ticket sales of C $ 500 million per year, the company could be worth as much as C $ 1 Billion using a multiple of two times annual sales. CIRQUE DU SOLEIL has not forgotten its roots as a band of street kinds turned world-class performers. The Cirque du Monde program, where kids are brought together to learn the circus arts in order to forge new healthy relationships with other kids & society. In addition to its own initiatives, 1% of Cirque revenues from ticket sales are donated to outreach programs designed to aid the development of disadvantages children.

Mr. Laliberte was slowly realizing & reviewing CIRQUE DU SOLEIL’s position in the market. To sustain in the market in December 2000, CIRQUE DU SOLEIL announced its plan establish Mega entertainment complexes around the globe. These complexes would consist of a combination of hotels, restaurants, retail stores, museums, spas,and the like, all sharing the common theme of the alternate ” Cirque” reality. Mr. Laliberte Explained the idea :

RIGHT NOW YOU GO TO A CIRQUE DU SOLEIL SHOW, YOU ARE INSPIRED ABOUT THE EXPERIENCE, THEN YOU WALK AWAY FROM THE BIG TOP AND YOU ARE BACK TO REALITY. OUR DREAM IS TO HAVE SOMEONE WALK FROM THE SHOW

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Analysis of the case: Cirque du Soleil AND GO TO A CIRQUE DU SOLEIL HOTEL, OR A CIRQUE NIGHTCLUB OR A CIRQUE RESTAURANT OR TO AN ART GALLERY DESIGNED BY CIRQUE DU SOLEIL. IF YOU THINK OF “ O “ FOR INSTANCE, WE HAVE DEVELOPED A VERY SPECIFIC TRADEMARK OF A WATER SHOW. THE BRAND OF “ O “ AND ALL THE EQUIPMENT WE HAVE THERE IS OWNED BY US. WE HAVE THE INTELLECTUAL PROPERTY. CAN WE TAKE THIS WATER SHOW AND TAILOR TO A SPA? THAT’S THE CREATIVE THINKING BEHIND THIS PROJECT.

CIRQUE DU SOLEIL’s great achievement and ultimate goal was to turn the venture into a continuing series,” watching TV these days is a little depressing, People are looking for artistic entertainment that inspires them and makes them think about something other than war and sickness” and also Mr. Laliberte made the Cirque is so international is that they have no language – they are universal. On top of this Mr. Laliberte knew exactly the right path to achieve the GOAL, same this he Executed and his CIRQUE DU SOLEIL became one of the best Circus in the world. The above GOALS were great achievement for CIRQUE DU SOLEIL as well as for Mr. Laliberte.

INTERNAL ANALYSIS Analysis of Cirque du Soleil: Compromise between art and profit has been managed very well by Cirque du Soleil. Artistic creativity and commercial success have proven that business can be as much fun as creating a show. After 20 years of continuous effort organization has reached at a crossroad as recognition of success. Internal analysis could be as under: Internal Strength: Could be explained as follows:

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Analysis of the case: Cirque du Soleil Competitive Advantage: Initially they were proven as effective cost leader, at the sector of recreation, were considered as universal, ‘citizen of the world’. After the competitors entered the market (Cirque Eloize and Cirque Eos) Soleil evaluated and reviewed their strategy. Soleil was a clear differentiator. Blend of opera, dance, theatre, circus, music and world class choreography create a unique context those captivate and surround viewers attention. Their main focus was to attract people towards their show and provide them excellent recreation. Their show appeared such like that which draw people back to their childhood, when all seemed possible. Organization as ‘competitive’: In addition to above Soleil was involved in merchandising, TV specials, video and CD sales as well. Finally to survive against competitors they introduced 13 one hour television episodes of wordless entertainment, they have introduced them with small screen instead big top. Resource based view: Can be explained as under:  Appropriable: Soleil was unique at the sector of recreation. At times they used to evaluate and review strategy to survive against competitors.  Sustainable: With the variety of art of show which attract people, contributes a lot towards recreation and appropriate sales of business make Soleil sustainable.  Valuable: Contents of art and business of Soleil are considered valuable based on above explanation.  Rare: Initially they were considered universal, ‘citizen of the world’. Later on against competitors they changed business strategy by moving from big top to small screen.  Inimitable: To maintain this criterion Soleil had to pay handsome salary to retain top performers, so that they can’t be hired by competitors.  Non substitutable: After initial growth they were considered universal. At a later stage after rising the competitors Cirque Eloize and Cirque Eos alternative substitute were available. Even relatively cheaper rate tickets were available to the customers.

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Analysis of the case: Cirque du Soleil

EXTERNAL ANALYSIS “Strategic analysis is a theoretically informed understanding of the environment in which an organisation is operating, together with an understanding of the organisation’s interaction with its environment in order to improve organisational efficiency and effectiveness by increasing the organisation’s capacity to deploy and redeploy its resources intelligently”. (Professor Les Worrall, Wolverhampton Business School) External environment refers to the major force and factor outside the organization, within as well as outside of the industry that affect the overall performance of the organization. External environment can significantly influence the effectiveness of the organization to large extend. A range of analytical methods can be used to analysis the external environment. There are mostly: • SWOT analysis • PEST analysis • Porter’s five forces analysis • Four corner’s analysis • Value chain analysis • Early warning scans • war gaming.

The aim of the analytical tool is to sharpen the focus of the analysis and to ensure a methodical, balanced approach. All analytical tools rely on historical, backward looking data to extrapolate future assumptions. It is important to exercise caution when interpreting strategic analysis results. Otherwise the analysis may be unduly influenced by preconceptions or pressures within the organization which seek to validate a particular strategic assumption.

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Analysis of the case: Cirque du Soleil Here we will employ Porter’s five forces analysis. Porter’s five forces of competitive position analysis was developed in 1979 by Harvard Business school professor Michael E Porter as a simple framework for industry analysis and development of business strategy. The theory is based on the concept that there are five forces which determine the competitive intensity and attractiveness of a market. It helps to identify where power lies in a business situation. The five forces are 1. Buyer’s power, 2. Supplier power, 3. Competitive rivalry, 4. Threat of substitution, 5. Threat of new entry

Cirque du Soleil started as a street live entertainment and over twenty years transforms itself is a very popular circus around the globe that blends opera, dance, theater and fireworks. With still lot of demand of shows, high demand for jobs and bagging prestigious awards means it has strong product differentiation and brand positioning. It has little threat in buyer, supplier or competitive rivalry perspective – it manages its own supply. It operates in developed market where buyers are ready to pay a premium price for quality and innovative entertainment. However it has local competitor as well as local competitor who have international exposure as well as foreign competitors. Even though these competitors are not very strong, they do create problem to retain top performers and erode earnings. To offset the threat of substitution and threat of new entry, diversity and further innovation are imperative and thus company needs huge financing which, without collaboration or going public is impracticable for Cirque Du Soleil.

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Analysis of the case: Cirque du Soleil

STRATEGY Strategy can be defined as a plan, method or series of actions designed to achieve a specific goal or effect. Strategy is the “means” by which individuals or organizations achieve their objectives.” means” refer to plans, policies, and principles that guide and unify a number of specific actions. As the business environment has become more unstable and unpredictable, so strategy has become less concerned with detailed plans and more about mission, vision, principles, guidelines and targets. If we consider the case of Cirque Du Soleil or examples of any other business organization, we can find that none wrote detailed strategic plans, but all of them possesses clear ideas of what they wanted to achieve and how they would achieve it. Certainly in a turbulent environment, strategy must embrace flexibility and responsiveness. When the firm is buffeted by unforeseen threats and where new opportunities are constantly appearing, then strategy becomes a vital tool to navigate the firm thru stormy seas. Strategy is about doing things differently; hence, the essence of strategy is making choices. Strategic choices can be distinguished by two basic questions: a. Where to compete?? b.

How to compete??

The basic question facing the firm is: “How do we make money?” The answer to this question

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Analysis of the case: Cirque du Soleil corresponds

to

the

two

basic

strategic

choices

mentioned

above:

a. Where to compete (i.e. “In which industries and markets should we be in?” c. How should we compete?

d. The critical requirement for a company’s success is its ability to establish competitive advantage. Most companies find it helpful to articulate their strategies in one form to another. In the case of the start-up enterprise, strategy is written down in the business plan that was prepared to raise Finance. And the founder of Cirque Du Soleil Mr Laliberte’s first strategy was to get Finance. Finally, purpose of strategy is to achieve certain goals. The case discusses various innovations at Cirque du Soleil, the Canada based circus Entertainment Company. Since its first performance in 1983, the company strove to be different from other circuses by constantly coming up with innovations . 1. Every show presented by Cirque, was based on a central theme with a supporting storyline, amalgamating different circus styles from across the world. 2. Cirque avoided animals and star performers, which were commonly seen in traditional circus. 3. The performances at Cirque were very innovative and quite different from what people normally saw. It added a certain amount of sophistication to traditional circus and thus carved out a niche market for itself. Till August 2007, Cirque's estimated revenues for the year were more than US$ 600 million with over a dozen shows running across the world at any point of time. Every new production was entirely different from the previous ones. To produce such vast varieties of acts, Cirque had to be extremely creative and keep innovating. It carefully devised its marketing strategies. Instead of being considered as just another circus company in a declining industry, Cirque redefined its market by fusing art and entertainment. The company's target market was mainly educated and sophisticated, opera going adults and families as opposed to the traditional circuses which were mainly for children.

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Analysis of the case: Cirque du Soleil Cirque Du Soleil is a “creative and innovative company”. Let’s consider its product and creative strategy. Let’s look at the threats facing Cirque Du Soleil and what the company can do to ensure its ongoing success. Cirque Du Soleil's product is a performing circus. The basis of the company is a show combining music, dance, and theater. The show uses acrobats, gymnasts, clowns, and other performers. The show also uses a type of music based on a created language. The purpose of the music is to transcend cultural boundaries and make the show accessible to everyone. The company's show is also multicultural in nature. It is designed to reach the widest audience possible. The company is global and shows are performed throughout the world. Cirque Du Soleil has also expanded into other areas. This has included releasing two films and a television special. This has also included ventures in publishing and merchandising. Cirque Du Soleil also opened a permanent theater near Disneyland, Florida, in 1998, with the theater including a Cirque Du Soleil store. These expansions show that the company is diversifying in a creative way. The expansions are all based on ways to increase the value of the Cirque Du Soleil show. This shows creativity, not in creating new things, but in finding new ways to benefit from the basic product of the company. The organizational structure of Cirque Du Soleil is based on recognizing the value of the performers. This is not a case where the artists are at the top of the organizational hierarchy. However, it is a case where the artists are recognized as delivering the service that allows the organization to succeed. Another key part of the organizational structure is that it is informal. This is seen in the case study, where Gagnon describes the company as not having a handbook on employee conduct. It is also seen in the case study where Gagnon describes employees as being fired and then rehired. Gagnon also describes an employee newsletter where employee's uncensored comments are published. These all show an informal structure and an organizational culture that is based on employee freedom and low authority over employees.

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Analysis of the case: Cirque du Soleil Based on the Internal & External Analysis, Strength, Weakness, and Opportunity & Threats we can suggest following strategies for Cirque Du Soleil:

1. It should emphasis on its “citizen of the world” appeal with its brand value“EVEN A CLOWN CAN DO IT: CIRQUE DE SOLEIL RECREATES LIVE ENTERTAINMENT”

2. Facing human resource challenges Mr. Laliberte replied that with 6 billion people in the world, the planet is full of Jewels & raw diamonds. And need to start Circus School. Its competitor “The Cirque Eos” has started the first circus school “The Ecole de Cirque du Quebec” and took the best pupils out on the road instead of shipping them off to the Cirque du Soleil.

3. “Promoting Creativity” is to be Cirque du Soleil’s Business Strategy 3a. Treasure hunting and creative transformation. Cirque du Soleil’s roots in street

performance are an indication of the type of individuals the organization seeks—or “hunts”—to join the group. That is the “heart” of Cirque du Soleil. The first members of Cirque du Soleil were open-minded risk takers. They were free spirits who were mostly self-taught and who lived a nomadic lifestyle, and they were considered “marginal” to society. Yet they exhibited a tough business sense. Successive generations of artists, artisans, technicians and employees have reinforced these qualities.

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Analysis of the case: Cirque du Soleil

3b. Nurturing environment. A major responsibility in entertainment and business is to create and build a nurturing environment that is conducive to productivity, creativity and personal growth. While Cirque du Soleil wants collaborative creativity, all team members need to be aware that the ultimate goal is the product. It’s all about the Show. 3c. Constraints, challenges, differences and consumer expectations. It is common knowledge among investors that Cirque du Soleil designers do not like budget, deadlines or limited resources. However, even the creative personnel admit that the constraints force them to become more resourceful and more creative. The constraints require being able to produce solutions that might not have been thought of before, and they are motivators for getting the job done.

3d. Risk taking; do you ever get burned? Creativity is—first and foremost—about the courage to take risks, to try new things and to share those experiences with others. In taking risks, mistakes can occasionally be made. But employees can learn from mistakes, and that can create greater credibility over the long term. The biggest risk an organization can take is to adopt complacency and not take risks, which can turn out to be the least productive strategy. 3e. Keep it fresh. By developing new creative products, Cirque du Soleil can keep the product fresh. That helps ensure that the product maintains durability and longevity. The organization’s managers are constantly encouraging and receiving employee feedback and ideas in ways that recognize that there might be many different approaches to reach the same result. It encourages the notion of shared creative ownership. In addition, artists, leaders or managers have to review and scrutinize the product continually from the perspective of the audience. Therefore, Cirque du Soleil’s leaders sit in the audience, night after night, watching the show and listening to what the audience has to say about the performance. 4. New Market Space Companies must stop competing with each other. The only way to beat the competition is to stop trying to beat the competition. To understand what Cirque du Soleil has achieved, imagine a market universe

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Analysis of the case: Cirque du Soleil composed of two sorts of oceans -- red oceans and blue oceans. Red oceans represent all the industries in existence today. This is known market space. Blue oceans denote all the industries not in existence today. This is unknown market space. Cirque Du Soleil needs hold the New Market Space (Blue Ocean) Too.

Finally, Cirque du Soleil needs to recheck the Two basic questions that are identified as defining a firm’s basic strategic position: a. where is the firm competing ? b. How is it competing?

ACTIVITIES: Emphasizing “Citizen of the world” Cirque Du Soleil can reinvent its brand by making its brand more global as the world is becoming a global village. At present scenario we can find that most of the Cirque DU Soleil revenues come from North America operation, although it has global operation in some extent. Besides, most of the competitors are also from North America as well. In addition to that post 9/11 scenario it is still to guesstimate how long more it will take North American Economy to come out of the recession. To overcome this scenario Cirque can give more emphasis on the “rising global economies” like South America, Asia, China, South and South East Asia. By doing internal and external analysis on Cirque Du Soleil’s strategy, we are seeing that Treasure hunting and creative transformation, facing human resource challenges, exploring New Market Space.

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Analysis of the case: Cirque du Soleil All the aforementioned challenges can be diverted if Cirque Du Soleil can do franchising of its brand in those low cost but high volume economies, ensuring the same “Cirque Du Soleil” unique experience to the audience.

To overcome “Financial constraints, challenges, differences” it is high time for Cirque Du Soleil whether they will remain as a Private Limited company or will go to IPO to form a Public Limited Company. This decision would help them in two different ways, their financing problem would come down drastically as well as they would get more passion to do much better by anticipating shareholders’ demand for growth which at present Mr. Guy Lalibete is considering as a negative approach but it might come up with as whole different depiction. Another point to support this change is that Cirque Du Soleil has already thinking about diversification from Artistic to Commercial approach cause even ignoring the new competition, it is not clear how much longer the Cirque can keep feeling 1000 seat theatres at such high admission price with variations on what is essentially the same product, perhaps it is time to re-evaluate their boundaries within which they are operating.

“Keep it fresh”: trends changes but style remains forever, bearing this slogan Cirque DU Soleil can reinvent their entertainment products by keeping the Cirque experience as different as earlier. Cirque can design newer low budget touring shows in a bit smaller format but emphasizing the local culture and life style by involving tenants form local industry which can be letter on franchised to some local partners as well. After certain these shows can be redesign or further new shows can be introduced to keep the Cirque experience fresh. This way Cirque may keep their shows fresh and revenue growth would also be sustainable. Cirque Du Soleil is an experience rather that a product, this is their motto till now, keeping that in mind the Cirque has no other option to make the “Cirque Du Soleil” experience available to more people by going in larger global context, this would help them to generate more revenue with sustainable growth.

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Analysis of the case: Cirque du Soleil

RECOMMENDATIONS: Although Cirque Du Soleil has mega-complexes, yet questions remained about how well the cirque magic would translate to the small screen. Had the cirque experience reached its saturation point? Would it be able to still be the same Cirque Du Soleil? Could the circus of the sun burn any brighter or burn out? We have the recommendations below to answer all the questions:1. To sustain its ambitious expansion schedule and reputation for continuing to outdo itself, Cirque would have to embrace and cultivate the qualities leaders embody. Cirque would also need to learn how to quickly replicate its high-performing teams. 2. They need to comprise a number of teams who will have learned how to use insights to bring a Whole Brain approach to their work at Cirque. Then Cirque du Soleil’s teams will benefit from a unique understanding of the thinking style that each team member brings to the fore. Also we will have different thinking preferences in production vs creative vs corporate. The Whole Brain concept is very powerful, and the trends are very important to acknowledge and accept.” As a result, - Cirque will have achieved a better understanding of interdependencies - A greater openness about different thinking - Styles in the organization increased team effectiveness. 3. We should introduce a unique strength of coaching with high caliber athletes and artists, and we need our leaders to become good coaches to employees for the best and creative performance 4. We will find better results to make team profiles which will help always to explain why the team is going through what it is.

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Analysis of the case: Cirque du Soleil 5. Each Cirque du Soleil new show may have its own creative director and production director. These two people—drawing from opposite parts of their brain is to create a phenomenal show. 6. Cirque can promote its shows with a varied marketing mix of print, television, radio, public relations, and outdoor media. Cirque may select media partners in each of its markets to minimize costs, create long-term relationships with local players, and develop promotions adapted to the local community. 7. Cirque can take advantage of Web-based advertising, and may reaches highly motivated customers through its online Cirque Club. In addition to receiving regular updates on Cirque activities, more than a million Cirque Club members worldwide can have access to advance tickets. 8. To overcome its saturation point of experience, a sexy and provocative new show for adults may be introduced.

9. Creativity is also at the heart of the organization’s overall business plan. There is no room for compromise at Cirque du Soleil when it comes to artistic expression or to strong business development. Maintaining the delicate balance between these principles is a continuous process.

CONCLUSION: The First Definition of “Strategy”“The determination of the basic long-term goals and objectives of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals.(Alfred Chandler, Strategy and Structure) Cirque Du Soleil is a company that has built its success on its ability to be creative and innovative. It has successfully developed a new market and continued to expand on that market. This makes Cirque Du Soleil an example of a company that has creativity and innovation at its base Reinvention is a constant theme. Having redefined the traditional “big top” circus in the 1980s, Mr. Laliberté keeps audiences loyal and attracts new ones by always

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Analysis of the case: Cirque du Soleil offering something different The Company develops new products (shows) all the time. Because a show takes so long to create – recruiting performers, devising music, costumes and infrastructure – it looks ahead to develop tomorrow’s performers and staging today. The key success factors for an Industry: Competitive Imperatives, Technological Imperatives, Financial Imperatives, Marketing Imperatives, Organizational Imperatives, Operational Imperatives Competitive: Innovation, Uniqueness, and Reputation Technological: Leading-Edge Knowledge, Expertise Financial: Capital, Pricing, and Remuneration Marketing: Products, Propositions, Customer Base Organizational: Recruiting, Culture, Knowledge Operational: Client Management, Global Systems So Cirque implemented the key success factors successfully. The Cirque “immersion programmed” aims to bring out the best in an individual. Key to the transformation process is mentors – veterans who guide new artists and get to know them. Cirque describes itself as a “family”, a “band of brothers”. Reinvention is a constant theme. Having redefined the traditional “big top” circus in the 1980s, Mr. Laliberté keeps audiences loyal and attracts new ones by always offering something different. The company develops new products (shows) all the time. Because a show takes so long to create – recruiting performers, devising music, costumes and infrastructure – it looks ahead to develop tomorrow’s performers and staging today. Instead of being considered as just another circus company in a declining industry, it redefined its market by fusing art and entertainment (Refer Exhibit II for the history of Circus). Cirque invested an enormous amount of time and money in preparing unique sets and costumes. Sometimes, the amount spent on creating a theater for a Cirque production was exorbitantly high.

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Analysis of the case: Cirque du Soleil Cirque differentiated itself from the traditional circus in all business aspects. The company created a niche market of live entertainment within the entertainment industry. Rather than providing a product for which demand already existed, it used its innovativeness and creativity to create a demand for live entertainment. The case discusses various innovations at Cirque du Soleil (Cirque), the Canada based circus Entertainment Company. Since its first performance in 1983, the company strove to be different from other circuses by constantly coming up with innovations. Every show presented by Cirque, was based on a central theme with a supporting storyline, amalgamating different circus styles from across the world. Cirque avoided animals and star performers, which were commonly seen in traditional circus. The performances at Cirque were very innovative and quite different from what people normally saw. It added a certain amount of sophistication to traditional circus and thus carved out a niche market for. TO improve Firm Performance these are the basic and Cirque adopted and implemented without failure: Develop Competitive Advantages: Define unique cost position, differentiation, market segments Cultivate firm-specific resources & capabilities Change the Industry Structure: Manage the Five Forces (raise entry barriers, reduce rivalry, etc) Manage the value chain, profit pools, complementarities 1 Move into Attractive Industries: Manage corporate growth; the corporate portfolio Diversification strategy; merger & acquisition; synergies

2

Commenting on the success that Cirque has achieved, Linda Tischler, Senior Writer and

Former Managing Editor (of the 'New Media' section), Fast Company, wrote, "At a time when audiences for all performing arts are declining, Cirque du Soleil has taken a particularly moribund segment of the market -the circus -and created an entertainment juggernaut, with a burgeoning record label, a retail operation and a deal with Carnival Cruise Lines."6 3

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Analysis of the case: Cirque du Soleil 4

Cirque invested an enormous amount of time and money in preparing unique sets and

costumes. Sometimes, the amount spent on creating a theater for a Cirque production was exorbitantly high.

5 6

Cirque differentiated itself from the traditional circus in all business aspects. The company

created a niche market of live entertainment within the entertainment industry. Rather than providing a product for which demand already existed, it used its innovativeness and creativity to create a demand for live entertainment... Key Concepts and Techniques: Hierarchy of Growth Related Diversification Portfolio Models Synergy Core Competence Industry Structure (Five Forces) �Key Success Factors �Value Chain �Profit Pools �Value Net Directions in Which to Diversify Technology Geography Customer Cirque Du Soleil has also expanded into other areas. This has included releasing two films and a television special. This has also included ventures in publishing and merchandising. Cirque Du Soleil

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Analysis of the case: Cirque du Soleil also opened a permanent theater near Disneyland, Florida, in 1998, with the theater including a Cirque Du Soleil store. These expansions show that the company is diversifying in a creative way. The expansions are all based on ways to increase the value of the Cirque Du Soleil show. This shows creativity, not in creating new things, but in finding new ways to benefit from the basic product of the company. The company's show is also multicultural in nature. It is designed to reach the widest audience possible. This is done by using the music that is not based on any real language. It is also done by using performers from around the world. The company is global and shows are performed throughout the world. Another key part of the organizational structure is that it is informal. This is seen in the case study, where Gagnon describes the company as not having a handbook on employee conduct. It is also seen in the case study where Gagnon describes employees as being fired and then rehired. Gagnon also describes an employee newsletter where employee's uncensored comments are published. These all show an informal structure and an organizational culture that is based on employee freedom and low authority over employees. Schein (2003, p. 121) notes that a culture of freedom increases employee creativity. Daft (1997, p. 325) also notes that "many organizations today are becoming less formal in order to be flexible and responsive to a changing global environment." In the case of Cirque Du Soleil, the structure has always been informal and this allows it to encourage creativity and be more flexible and capable of change. Thus the diversification strategy added enormous value to the company. It became a global player.

Cirque was cited as one of the companies to have implemented 'Blue Ocean Strategy' by creating demand, by developing a new market space, where competition was non-existent (Refer Exhibit I for information on Blue Ocean Strategy).

Here is SWOT analysis for Cirque du Soleil.: There truly is no other show like it on Earth. It is not like a traditional circus. It does not contain a center ring or have a parade of animals performing tricks despite the high production and ticket cost they continually grow stronger. Every one of their shows

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Analysis of the case: Cirque du Soleil has been profitable to date and it does not look like that will change. Being so unique gives them such strength that it is difficult to find weaknesses.

Opportunities Threats, Strengths, Weaknesses, Opportunities, Threats: Cirque Du Soleil took the concept of a circus and completely re-invented and innovated it in a way that has shocked and amazed the world leading to performances on all parts of the globe.

REFERENCE 1. Text Books 2. Web Site 3. Group Discussion 4. All Study Materials

The End -------------Thank You

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