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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

(kogonuso@gmail.com)

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 support the

upcoming 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

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.

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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 support the upcoming

substantial growth planned by Cirque. This task fell on Danielle Savoie, whose first mandate

was on finding efficient ways for IT to support 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

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 supporting

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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 members 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 support 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

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

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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 support 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

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

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business process, there must be a workaround for these vast ranges of activities as they

support 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 support the upcoming 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 support the upcoming 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 support the upcoming 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 support 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

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

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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 support 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

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

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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.

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

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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 support the sales and information display

and gathering that will support 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 supporting 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

meet. Using the findings, they are now designing 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

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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

supported 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

Information Systems