Cirque Case Study

Introduction –

Cirque Du Soleil is a circus, which was founded by groups of road performers in 1984. Those groups of street performers were known as Le Club Des Talons Hauts that means high-heels club. Few members of those street performers are still with the company like Laliberte, who is now the Chief Executive Officer and President as well. When the company began its operation in 1984, there were only 73 employees and now the company has more than 4000 employees globally. The company is known to be one of the most important Canadian entertainment companies with its global presence in more than 200 cities in five continents.

Creativity has always been at the cornerstone of Cirque and that has lead the company to ensure that its business model fit its strategy. The company had vast ideas to create new projects that would provide limitless opportunities for growth. One of the biggest unknowns would be the venture of new partnerships and how successful would those partnerships become in comparison as the one with MGM Mirage (Cirque Case Study).

Problem Analysis –

1. Hiring and Retaining Employees - Retaining employees are important for the company because companies engaged in entertainment are solely based on having creative employees. This theory is especially applicable on Cirque Du Soleil because the business of the company is circus without animals. Management of the company needs to make their employees satisfied and content with their jobs so as to make most out of them and to make business profitable in the long-run. Research and development of the company also includes hiring and recruiting of employees that is often a time-consuming and costly procedure. During the process of hiring and recruiting, the company needs to analyze five major characteristics in candidates that are accountability, creativity, passion, commitment and team-play. Initially, the newly hired employee spends his time in the process of learning the company’s environment and applies it on their jobs.(Cirque: How to Manage Growth)

1. Growth Strategy – Multiple productions had left the organization exhausted by the end of 1999 (Cirque Case Study). Topics that were discussed included royalty structures, creative control, and future artistic direction. There were also key creative individuals who had left the company as well and the Cirque organization had realized that there was a dependency among those individuals.

1. Organization Overextended – Montreal headquarters were overflowing with new productions and increased support activities (Cirque Case Study). The company would not agree to outsource any types of activity. There were so many shows that were in operation, the complexity of Cirque reached new heights.

Solutions –

1. In order to retain employees, Laliberte and Gautier could offer attractive and competitive packages and benefits to their employees. Increase in benefits and packages motivate employees to stay in Cirque Du Soleil. These benefits may include giving health insurance and benefits with respect to their health risk because the lives of performers are always at risk and the injury rate is also very high. Further, additional benefits like telecommuting and flexible working hours is a way to show the artist in Cirque that they are important and being valued as well. I would also provide training in terms of employee development so that new skills and expertise can be cultivated. In this way, performers may find a path to see themselves self-motivated in the organization and certain about their own success.

1. I recommend that the company should incorporate the strategy to focus on resident shows within global major markets. This will help with the growth strategy of stability. The MGM-Mirage resident deal shows us that Cirque would make $30M in operating profits even after splitting all the profits 50% with MGM-Mirage. (Cirque Case Study). These global markets would include Asia, South America, and Europe. There is hesitation to agree upon the destination of these resident shows and I agree with Lamarre about choosing the right partnership that will produce the characteristics of trust, honesty, loyalty, and integrity.

1. I would advise the company to overextend with their stage performances instead of with the organization. Content creation is the key to strengthen the organization as a whole and to fuel the growth strategy of increasing the amount of resident shows within the global major markets. With the creation of new shows, the avenue of merchandising will be a contributing factor to the overall growth of the company. Merchandising represents 10% of Cirque’s overall revenues (Cirque Case Study)

Conclusion –

        I believe if Cirque du Soleil follows the above recommendations, they will continue to take the world by storm. The company challenged the conventions of the circus industry. Cirque’s productions have been seen by more than 150 million spectators in more than 300 cities around the world. In less than twenty years since its creation, Cirque du Soleil achieved a level of revenues that took Ringling Bros. and Barnum & Bailey, the once global champion of the circus industry, more than one hundred years to attain. What makes this rapid growth all the more remarkable is that it was not achieved in a declining industry in which traditional strategic analysis pointed to limited potential for growth, declining revenue, and profits. There was also increasing sentiment against the use of animals in circuses by animal rights groups. Ringling Bros. and Barnum & Bailey set the standard, and competing smaller circuses essentially followed with scaled-down versions.

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