Routines and Capabilities of Warner Brothers Entertainment - Case Study Example

Introduction The ability for a corporation to use resources and create new and innovative products and services is a main component. A specific resource that determines the success and failure of a company is based on the business finances, specifically which reflects other resources and organizational needs of the company. Warner Brothers entertainment is one of the corporations that shows how finances and resources reflect each other. Warner Brothers Entertainment is known as a fully – integrated entertainment company, with the production of movies, TV, video games and music. The finances that contribute to Warner Brothers are based on selling the entertainment products that are a part of the corporation. Each time that the movie, on demand video, TV program or other entertainment is bought or used, the corporation receives a portion of the profit as a license owner of the entertainment. This is followed by financing that is provided with several of the products that display the corporate identity such as t-shirts, hats and other small products. For Warner brothers to establish a strong component to finances, is also the need for other parts of the organization to work effectively in establishing the reputation of the products offered by the corporation (Warner Brothers, 2010). Resources of the Business Used There are several resources that Warner Brothers uses specifically to ensure the financial success of the corporation. The first are the human resources which make up the organizational structure of the company. The structure includes a chief executive officer, a board of seven operating officers and divisional executives. The officers are designated to make decisions about the corporation and provide insight into the direction that the company should move in. The divisional executives are responsible for the establishment and continuous production of different forms of entertainment, all which are able to provide different insight in the direction of the company. Underneath this are managers and producers which are responsible for specific projects and which are set into studios that are used to produce specific forms of entertainment. The divisions include international cinema, DC entertainment, consumer products, pictures group, television group, animation, home entertainment and home video (Warner Brothers, 2010). The human resources are further defined by the type of entertainment which is hired into the company. Without hired assistance from independent contractors, such as actors, entertainers, musicians and others who produce the entertainment, the company would not be able to function. The strongest asset of Warner Brothers in terms of human resources is the entertainers which support the company. Many of these are hired according to the projects which are occurring in the studio while others are under contractual agreements with the company. These practices for human resources have allowed the entertainment company to strategically place individuals and grow in recognition with their given company (Ulrich, Brockbank, 2005). Another set of resources which are used by Warner Brothers is the financial considerations. There are two types of financing which are required by the corporation. The first is based on the continuous maintenance and growth of the corporation. The company requires a studio to produce the entertainment in, as well as other aspects that are required for the specific projects being provided. Technology, telecommunications, infrastructure of networks and entertainment products and services all require the same financial demand. The second type of financial needs is based on specialized projects, such as movies, international cinema and music and video games. Each of these requires specialized investments with a specific amount of risk that takes place when building and releasing a new product. Advertising and marketing, payment of all individuals and the ability to create new and innovative additions all become a main part of this component of the company. For this to work, resources are needed from the past investments that have brought a return, such as through products and resources. Stakeholders and outside investors for financial support of productions are also required for creating the market. Without outside financiers, there is difficulty of investing in the entirety of the project for the company (Picard, 2002). The third type of resource which is required for the finances of Warner Brothers is the organizational performance and structure. The main area of finances that is affected within the organizational structure is based on the temporary work which is a component of the entertainment industry as well as the continuous training and development which is required in the organization. The project based form that the entertainment companies affiliate with requires multiple networks, alliances, partnerships and connections too potential human resources. While the organizational structure is one which is stable in terms of directors, there are other affiliations with this that are based on the industrial sector which requires continuous development, training and changing expectations within the company (Whitley, 2006). An example of this with Warner Brothers is based on new technologies that are required. The organization established will need to learn how to incorporate the Internet and entertainment technologies to the organization. However, this requires an organizational strategy for change management and training on the new technology. The entertainers and others continuously moving in and out of the studio create a unique structure when trying to train for diverse needs, specifically because there is an external and internal structure when trying to enhance the business or create a different presence. This has led to several divisions in the company as well as a division between the product process and the release of products, specifically to stabilize the environment. Physical components and resources that are within the entertainment industry are another important factor associated with the company. The physical resources begin with the studio and the main buildings which are required for the development of products. Technology equipment, settings and other aspects which relate to the creation of movies and entertainment are required. This is followed by the physical resources based on technological needs. TV equipment, music equipment and other pieces of technology are required, specifically because of the digital revolution which is occurring. The space required is then followed by the physical requirements for end products, including packaging and distribution needs which are associated with the corporation (Rouse, 2005). Warner Brothers example of this is seen in the production of a movie. Physical space has to be available to create the sets for the production. The sets also require physical components, such as creating the right space and using the technology required to capture each scene. The physical space is followed by the production of the work which goes through a process of making the movie digital. The last component is taking the finished product and placing it in a production house for distribution of the movie through DVD cases, Internet releases and other ways to get the movie to others. The last set of resources required is technological. A problem which has been created in the past years is based on the emergence of the Internet. Indie artists, smaller groups and others are able to use technology for different types of music, downloads of alternative movies and pirating of movies. The technological requirements of the company combine the need to have a physical presence, which includes a website and associations through the Internet. There are also alternative needs to continue to have the correct licensing, protection and resources that are needed for the company. By doing this, there is the ability to create a stronger presence while using the alternative means for advertising for the company. However, the extra components of technology in terms of protection and releasing online have led to more financial considerations within the corporation (Leyshon et al, 2005). Routines and Capabilities of Business The routines that are associated with Warner Brothers are based on the executive proficiency which determines projects, financial components that are associated with this and the end process is one which is based on decision making and strategies to follow through the complete process of making entertainment products. The form of the business is the main strategy which is able to provide the correct strategy. The process which is used ensures that the financial means are available to the corporation while the extra components that are a part of developing the products continue to add into the transformation of the firm. The routine of working with individual projects while streamlining other products is what allows the business to continue functioning by making new products and developing organizational change through the requirements and demands of the market (Rindova, Kotha, 2001). For Warner Brothers, the organizational structure is one which carries several capabilities. The main structure which is used is one which provides more capabilities and functions for the overall design of the company. Using both full time employees which care for the physical, technological and product functions provides strength to the corporation. At the same time, there is a set of different capabilities that are available because of the continuous products available. These create a continuous lifeline for the products so Warner Brothers can increase finances through production of old entertainment while offering new innovation to the corporation. By doing this, there is the ability to create more products while continuing to increase the finances. The resources that are a part of the corporation add into expenses; however, they provide assets and the ability for the corporation to progress. Conclusion and Recommendations While Warner Brothers has a strong foothold in the organizational procedure and the way in which it incorporates into the resources and finances, there is also the capability to improve with efficiency. The company can begin this by increasing financial support for expected new projects. Since the corporation relies on new products to create stability, there is the need to designate money from profits into new projects in a more organized manner. The business routines can be increased by changing the financial considerations. This will also stop the reliance on outside financers and stakeholders that are a part of the corporation. The capabilities of the corporation will increase in the number of projects which can be done, the amount of individuals which can work in full time contract with the company and the ability to create different prospects for company growth. References Leyshon, Andrew, Peter Webb, Shaun French, Nigel Thrift, Louise Crewe. (2005). “On the Reproduction of the Musical Economy After the Internet.” Media Culture Society 27 (2), 177-209. Picard, Robert. (2002). The Economics and Financing of Media Companies. New York: Fordham University Press. Rindova, Violina, Suresh Kotha. (2001). “Continuous Morphing: Competing through Dynamic Capabilities, Forms, and Function.” The Academy of Management Journal 44 (6), 1263-1280. Rouse, William. (2005). “A Theory of Enterprise Transformation.” Systems Engineering 8(4) 279-295. Ulrich, David, Wayne Brockbank. (2005). The HR Value Proposition. Boston: Harvard University Press. Warner Brothers. (2010). About Warner Brothers. Retrieved from: www.warnerbros.com. Read More