Operations Management Processes and Supply Chains__KRAJEWSKI_LEE_J_ch1

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E o o \ o s o x E (I b p c (! N N o o o p f o USI NG OPERATIONS TO CREATE VALUE Characters perform at Cinderella's Castle in Magic Kingdom, 0rlando, Florida, USA. Disney isney Corporation is an internationally diversified entertainment and media enterprise comprising of f ive business segments of media net- works (e.g., ABC, ESPN networks), parks and resorts (e.9., Disneyland and Disneyworld), studio entertainment (e.9., Pixar and [Varvel studios), con- sumer products (e.9., toys, apparel, and books), and interactive media (e.g., Disney.com). lt is one of the 30 companies that has been a part of the Dow Jones lndustrial Average since 1991. With annual revenues of $45 billion in 2013, Disney is particularly well known for its theme parks that had a 17 percent increase in operating income to $2.2 billion in the last f iscal year alone. lts largest park, Walt Disney World Resort opened in Orlando, Florida, in 1971 and includes the lVlagic Kingdom, Epcot Center, Disney Studios, and Animal Kingdom. Disney constantly evaluates and improves its processes to enhance customer experience. One of its recent innovations is a $1 billion compre- hensive reservation and ride-planning system that can allow guests to book rides months in advance through a website or a smartphone app. Dubbed as IVlylVagic+, it works through a radio-frequency identification (RFID) chip em- bedded inside electronic wristbands or bracelets that guests wear once they check into a Disney theme park, Called MagicBands, they link electronically to centralized databases and can be used as admission tickets, credit or debit cards, or hotel room keys. Just by tapping them against electronic sensors, these lVagicBands also become a form of payment for food, entertainment, 21
22 CI.IAPTER 1 USING OPERATIONS TO CREATE VALUE and merchandise. Data from these wristbands can help Disney determine when to add more staff to which rides, decide how many employees in cos- tumes should roam around at which locations in the park, determine restaurant menus and which souvenirs should be stocked based on customer prefer- ences, and even send e-mail or text message alerts to guests when space opens up in an expedited queue at that guest's favorite ride such as Space [Vlountain or Pirates of the Caribbean. Apart from facilitating crowd control and data collection, this wearable technology helps Disney seamlessly person- alize each guest's experience and change how they play and spend at the oft-advertised "[Vost [Vagical Place on Earth." Despite some privacy concerns surrounding the use of RFID chtps that can track a guest's identity and location within the theme parks, the new lVyVlagic+ system has multiple advantages. First, when visitors have well- planned schedules and forward visibility on what they are going to do on a given day on an hourly basis, they are less likely to jump ship to other theme parks in the area such as the Sea World or the popular Wizarding World of Harry Potter by Universal Studios.

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