Walt Disney Co: The Entertainment King - Case Study Example

Walt Disney Co: The Entertainment King According to Rukstad and Collis (2), Disney’s diversifications strategy is one of the best recommendable implementations that have led to the organizational turn around and competitive advantage over the past few years. With Eisner taking over as the CEO in 1984, a resolution to engage into a diversification was seen as a brilliant process that increased the performance process towards Disney’s resurrection. With a growth rate target beyond 20%, the organization expanded into television entertainment through the launch of programs such as Mickey Mouse Club show that enhanced financial returns.

Besides, the organization also stimulated public interest to buy Disney’s packages that are designed in similar contexts. As part of the diversification process, the organization revitalizes some of the products through a constructive process aimed at building television and the movie business. Through such engagements, Disney stopped production of network television shows and focused into the maximization of revenues through national television advertisements and selling of tickets to media broadcast events.

Ultimately, the organization has also diversified into a theater production that was initially seen as a risky idea. However, through creative guidance and calling for a rewrite of scenes, the organization sustained development and increased the returns by $29 million during that financial period after the implementation (Rukstad and Collis 4). Disneys CapCities/ABC Merger From the Rukstad and Collis (8) case study, to improve the organizational competitive edge Disney acquired CapCities/ABC to facilitate programming and distribution of its channels.

Without seeking the assistance of other financial institutions, Disney Company successfully bought CapCities/ABC with almost $20 million believed to be the second highest independent acquisition in the history of the United States. ABC was a lucrative company engaged in different kinds of services including radio stations, television channels, print outlets and varied types of periodicals. Therefore, the acquisition by Disney enhanced a competitive platform in the entertainment industry in the United States.

Despite that fact that acquisitions of bigger companies in that past have been associated by management and operational problems, Michael, Disney’s chairman of talent and creativity clarified that the merger would enhance global accessibility. Besides, it improves the organizational returns. Right before the merger, it has been pointed out ABC had already made several engagements with Disney Company. For instance, the two had already initially agreed on a joint fund towards the development of TV shows, talent management and setting up of a production studio.

Merits of ABC mergerRegardless in the falling of ABC position from the top to third position after the merger, there are several benefits that both ABC and Disney have achieved from the union. For instance, the union became more stabilized by the year 2000, and the revenue streamed to the bottom line thus an increase in profit margins. Moreover, the companys merger and vertical initiatives are very important since it helped the two companies to save on the production cost that could have otherwise been too expensive if every institution were to remain independent.

Ultimately, the union has enabled the two organizations to acquire additional skills and creativity that are vital for movie and the entertainment Industry. More so, Disney has achieved the best business intelligence from ABC Company since it was already stable within the entertainment industry (Rukstad and Collis 11). Works Cited:Rukstad, Michael and Collis, David. The Walt Disney Company: The Entertainment King. Harvard Business School, January 5, 2009.