Rethinking Disney - Strategic Management, Private Control, and Public Dimensions - Case Study Example

Question 1: Eisner’s first decade and half at the helm of Walt Disney was an astounding success backed by some managerial and structural upheavals within the organization that form the basis of many a studies in contemporary structural management. The first step that Eisner took was to ensure that the focus of the organization remained on creative success and the management was transformed so that it could adapt to this particular goal. His basic sense of management values underlined the idea that one plus one can equal more than two when firms leverage their core competencies (Dess, Lumpkin and Taylor, 2004). This style of management was a marked change from the days when Disney was a small company-a flat non-hierarchical organization where employees were on a first name basis. When Eisner took over Disney as its Chairman in 1984, Disney had witnessed one of the worst years in its corporate history where most of the productions were complete busts. Eisner made some sweeping changes chief among them ensuring a sense of diversity in Disney’s management structure and the initiation and harnessing of creatives within the company leading the pack. The idea was simple. Taking a risk with a knowledge that a diversity of ideas could create friction, this was the very creative friction that lay at the success of the Eisner’s success at the beginning of his tenure. His style of management suited dilapidated structure that Disney had become. The confrontational attitude that he implemented in the management of his staff is legendary, believing that conflict and friction was a positive way to lead (Miller 2005, p.5). He also had a great vision for Disney that he implemented with gusto in the first decade, hence came the theme parks and the Disney stores- the venture in Europe then in Asia; Edgy Miramax was brought into the fold- making kids and investors feel warm and fuzzy about Disney again. The stock performed miracles and vaulted him into the rarefied ranks of managerial genius. Eisner changed that single handedly with his success. The success was harnessed through the synergies among the various business units. The structure was reorganized from a hierarchy to a hybrid management scheme, with Eisner at the very root of every single management and creative decision taken. The positives of his management style however were far outnumbered by the negatives. Once the compnay reached a level of stabilization, his confrontational and friction creating style of leadership fell on its head. The great visions he had were not followed up with planned strategies for implementation. His style of creating conflict and friction delayed projects and slowed the pace of decision-making. So could state safely that his management style would not find favor with success in the present global economic and corporate scenario. References: Dess G, Lumpkin G T and Taylor M L, 2004, Strategic Management: Cresting Competitive Advantage, pub, A1Books Publishing, p197 Gross D, The Louse in the Mouse, pub, Moneybox: Commentary about Business and Finance, accessed September 10, 2009, < http://www.slate.com/id/2069052/> Question 2: The plans to build Disney America, a historical theme park project located on three thousand acres in Prince William County, Virginia thirty-five miles west of Washington DC were announced in 1993. The $625 million project was to include a hundred-acre theme park, twenty-five hundred homes, tow million square feet of office space and a campground among other things (Budd and Hirsh, 2005). The problem with the project began by virtue of the fact that it was located just five miles from the Manassas National Battlefield Park the memorabilia of one of the bloodier battles of the civil war. The project was to be subsidized by $200 million from the state and $75 million from county tax-payers. The public subsidy created problems for Disney, which was termed by county executives as being non-negotiable. Organized opposition thus developed on two fronts: 1. Protect Historic America fought the Disneyification of US history; 2. Piedmont Environmental Council, a regional environmental preservation group opposed the destructive sprawl tat would accompany the development. The latter group enjoyed the financial backing and national political clout of its residents-the Virginia gentry, sub-urban squires and Washington power brokers. By 1994, the project had turned into a battle that Disney could no longer control. The response from the corporate was an attempt to cast itself in a populist mold and the opposition as elitist historians and fox-hunting gentry that cared little about jobs for the ordinary people. The PR machinery however was lowed down by the opposition, there were losses to absorbed from Euro Disney, there was the death of president Frank Wells and the abrupt exit of Jeffery Katzenberg to deal with- burdened with shock after shock Disney decided to pull out of the project in September 1994. There were fundamental mistakes that were made by Disney on the Disney America project from its inception to its end. Disney was unable to recognise the fact that it was perceived as a multinational hegemon that was seeking to invade the boundaries that divided the public versus the private space. There were no attempts made by the management to get the residents on board with the project. The process of land and area acquisition was that of shady deals that no one had any faith in. there were no attempts at building a consensus on why the project would have been good for the area, aspects such as the revenue it would bring in for the relevant tourism industry were never touched on. The PR campaign came across as highhanded and fake, seeking to manipulate the people through an offer of jobs. More than that there was a general perception that the project was looking to cash in on the battlefield and that gave the distinct impression of a a power and money hungry corporate trying to cash in on the emotions that were attached to it. The problems at the management level of the project were therefore well defined. Disney by the end of it all infact had no option but to pull out. The decision to enter the project the way they did and at the place that they did was obviously a mistake but the decision to bow out when they did was not. References: Budd M and Hirsh M H, 2005, Rethinking Disney: private control, public dimensions, pub, Wesleyan University Press, pp5-8 Holson, L. M, 2005, A Quiet Departure for Eisner at Disney. Accessed September 10, 2009, http://www.nytimes.com/2005/09/26/business/media/26eisner.html Question 4: Figure 1: Force Field analysis A force field analysis for the changes and expansion that Disney seeked to undertake in Europe would demonstrate the fact that changes if not taken based on a process of proper research and understanding of a market and its related set of conditions could lead to disaster or immense success depending on process followed by the company at hand. A force field analysis of the European market would reveal that the market unlike that of the US is a diversified and is made up of separate target audiences with separate demands. the force field analysis that would be needed for the organization and management of change in Disney Europe would seek to identify the forces that would help the process of change and those that would restrain and hinder the process. The greatest factor that would hold back change in the organization was the manner of management followed by Eisner at the helm of Disney. The capacity of the organization to take on expansion at the level at which it did in terms of infrastructure and skill within the compnay were not sufficiently evolved at the time when the changes were undertaken. Globalization was just starting to gather force and the European market was not completely ready for or open to an onslaught of merchandising from an American corporate. The various sections of the weaving that made up the organization were not given enough autonomy given the fact that they were all made heavily reliant on the European head of operations, Dennis Highwater. The positives of change that would help the organization were the diversification of interests from apparel, to music to others. The mergers and the partnerships that were created were also a help given the fact that these allowed Disney with a ready made database and a set target market which had been harvested over the years by these companies. A force field analysis would have helped the organization given the fact that it would help prioritize suggested actions and increase chances of success. The pockets of resistance that kept plaguing Highwater’s reign would thus have been eliminated had the weaknesses of the plan been identified prior to execution. References: Force Field Analysis, accessed September 10, 2009, < http://www.mindtools.com/pages/article/newTED_06.htm> The Force Field Analysis, pub, Walt Disney, accessed September 10, 2009, < http://vpadmin.fullerton.edu/AssistantVP/OrgDev/ProfDev/Mgrs/FacToolKit/ToolsEvaluate/ForceFieldAnalysis.pdf> Question 3: Distinguishing between the external and internal environment of the firm is common to most approaches that seek to undertake a design and evaluation of business strategies. The SWOT framework: strengths, weaknesses, opportunities and threats distinguishes between the two most important aspects o the organizational internal environment and the two external aspects of the environment: the opportunities and the threats. One of the greatest debates that a discussion on SWOT analysis with respect to Disney would have to undertake is whether no not Eisner is strength to the company. To the extent that he has masterminded Disney’s revival over the past 17 years, he is an outstanding strength but the innumerable miscalculations along the way, the many mistakes in judgment and the many instances of his highhanded arrogant way of decision making would make him a weakness (Khurana, 2002). If one was to set the debate aside, one could identify a set of strengths and weaknesses within the corporate with little difficulty. The cable network headed by ABC, bought by Disney in 1995, is among the top-rates US TV channels, and currently is estimated at $19 billion. The theme parks are another big strength that Disney can boast of, they are identifiable with the Disney name and are a source of constant revenue with not a lot of requisite inputs at present. The brand name, that sells and stands for wholesome family entertainment with it keeping its pace as the favorite in the children genre is another strength. The name is trusted in the genre of animated film production. The greatest weakness that the organization has to compete with is the idiosyncrasies of the man at the helm- Eisner. There are a number of bad decisions that have been taken over the years that could have easily been avoided. The stubbornness on the Pixar deal and the end of the partnership with Pixar is just one of the examples. The efforts to venture in cyberspace have yielded a whole lot of problems and losses. The Disney America project was another failure. The loss of Pixar that is recent and the fact that Disney has lot its successful animation partner is one of its greatest weaknesses at present. The greatest threat that Disney faces at present is from the economic recession the world over that has eaten into corporate giants like General Motors. The opportunities are in the filed of film making that would mean a growth in case the production house can venture into partnerships in the markets of the third world where it has limited to zero presence. The need o the hour is to recognise the strengths and cash in on them rather than a continuing experimentation with projects that turn out to result in one failure after another. A SWOT analysis like this on a mpore detailed scale could help the organization recognise strengths and ensure that it does not repeat the horrific mistakes of its past. References: Khurana R, 2002, Curse of the Superstar CEO. Pub, Harvard Business Review, Vol. 80 No. 9, pp60-65 Walt Disney, Stock Information, accessed September 10, 2009, < http://www.providence.edu/polisci/students/disney/stock.htm> Bibliography: Budd M and Hirsh M H, 2005, Rethinking Disney: private control, public dimensions, pub, Wesleyan University Press, pp5-8 Dess G, Lumpkin G T and Taylor M L, 2004, Strategic Management: Cresting Competitive Advantage, pub, A1Books Publishing, p197 Force Field Analysis, accessed September 10, 2009, < http://www.mindtools.com/pages/article/newTED_06.htm> Gross D, The Louse in the Mouse, pub, Moneybox: Commentary about Business and Finance, accessed September 10, 2009, < http://www.slate.com/id/2069052/> Holson, L. M, 2005, A Quiet Departure for Eisner at Disney. Accessed September 10, 2009, http://www.nytimes.com/2005/09/26/business/media/26eisner.html Khurana R, 2002, Curse of the Superstar CEO. Pub, Harvard Business Review, Vol. 80 No. 9, pp60-65 The Force Field Analysis, pub, Walt Disney, accessed September 10, 2009, < http://vpadmin.fullerton.edu/AssistantVP/OrgDev/ProfDev/Mgrs/FacToolKit/ToolsEvaluate/ForceFieldAnalysis.pdf> Walt Disney, Stock Information, accessed September 10, 2009, < http://www.providence.edu/polisci/students/disney/stock.htm> Read More