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Tokyo Disneyland and the DisneySea Park: Corporate Governance and Differences in Capital Budgeting Concepts and Methods between American and Japanese Companies                                                                                                                                                                                                                
Product Ref: 06/281C Company: Oriental Land Corporation

Product Type: Case Industry: Hotels, Restaurants, Leisure

Related Product(s): Teaching Note
Authors: Mitsuru Misawa   
In 1997, building upon their earlier success with Tokyo Disneyland, Oriental Land Corp. (OL) Japan and the Walt Disney Company (WD) discussed the possibility of a new joint project known as the Tokyo DisneySea Park. Different approaches towards capital budgeting and distinct corporate governance regimes led the two firms to evaluate the project in different ways. While globalisation of the Japanese economy has been advancing with astounding speed, management philosophy and capital budgeting techniques still differ significantly among Japanese and American firms. In a joint venture, such differences have a momentous impact on decision making processes. This case study illustrates key divergent practices between Japanese and American firms in the realm of corporate governance and finance.
Functional Area : Accounting & Control
Economics & Business Policy
Finance & Investments
Strategy & General Management

Issues: US capital budgeting (DCF, NPV, IRR); Japanese capital budgeting (ARR, ACFR); Japanese corporate governance; Impact of contrasting cultures; Customs and values between US and Japan in the decision making process; Negotiation techniques applicable in international ventures.
Length: Text: 16 pages
Exhibits: 10 pages
Country: Japan

Pub. Year: 2006 Level of Difficulty: 3
This product type is available in the following language(s):      English   Simplified Chinese
Related Information: N/A
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