Internal Analysis of The Walt Disney Company, Recommendations - Research Paper Example

The Walt Disney Company Introduction Walt Disney is a leading multinational company domiciled in the United s offering majorly mass media and entertainment services and has headquarters at Burbank, California. Walt Disney founded it on October 16, 1923 and his brother named Roy as a studio focusing on cartoons and animation as their major form of business both for local and international content. This company faced massive struggles to have a breakthrough in the market but got a breakthrough with the advent of the Mickey Mouse, which later turned out to be the mascot of the company. It is a large multinational corporation with about one hundred and seventy thousand employees spread all over the world with yearly revenue pegged at about $45 billion. The company has faced problems both internally and externally thus the need to strategically change its management and structure its organizational development (David, 29). Current mission, vision, goals, and strategies The mission of Walt Disney Company is to become the foremost producer and provider of entertainment and information through the use of their variety of brands to have distinct content, services and products for the consumers which must also be pioneering and imaginative. This company operates through organizational structure that has strategic business units, each dealing with its core purposes, which includes the media networks, the parks and resorts, the Walt Disney Studios, Disney Consumer Products and Disney Interactive. The goals of the company are to reach children as well as adult audience through the Disney products, which may include television programs, magazines, books, movies and musical recordings. It also aims at providing the Radio Disney channel through satellite radio, mobile applications and the web while its Disney Consumer Products provides the licenses for those who may wish to provide products based on the products of Walt Disney. Internal Analysis Financially, Walt Disney has assets amounting to about US $ 80.5 billion of assets while its revenue has been on an upward trend since the year 2008 running to 2013 with most of the revenue coming from advertising and affiliate fees amongst other sources. It generates the affiliate fees due to its popular ESPN channel, film syndication, merchandising and its ability to produce movies that are a hit in the film market. Walt Disney manages its affairs through the domestic and global integration of its corporate management strategies, which has helped it acquire other film corporations through its massive financial power. Due to its diversified nature of business, it is managed through six parts, which include globalization, horizontal integration, vertical integration, media synergy, diversification and distribution. Through its Walt Disney International, it conducts its globalization activities both within the United States and worldwide with an aim of providing relevant services and products to consumers. Through horizontal integration, the company has studio companies and media networks which promote its products against those of its competitors while vertical integration allows it plan, produce, advertise and distribute its products without the involvement of other player in the market. The integration is aided through collaboration with other players who posses similar corporate culture as Walt Disney and apply efficient production and distribution strategies. The company applies media synergy through its subsidiaries and companies that it owns which are allowed to produce and distribute the products and services that it deals in. Diversification in its products helps it focus on the market while at the same time satisfying their needs while distribution is carried out through its licensed outlets that only deal in what it offers (David, 178). The company has its internal strengths emanating from its strong diversification in the services and the products it offers, its responsiveness to the markets and the recognition of its brands, which make the customers loyal to its services and products. It is also the largest licensor of merchandise that is based on characters and has global standardization that has established divisions. However, the weakness in the company stem from the fact that it is costly in terms of costs of entertainment and the frequent change in their management. The parks and resorts by Walt Disney are also not accessible or unpredictable in terms of the trends for travel, the leisure times while its interactive media division is unprofitable. External Analysis Competition to Walt Disney depends on the segment in which it is as its business is usually mainly entertainment in nature and through this; it has diversified its business to create a niche for itself in the market. In the media network segment, Walt Disney has competitors in the name of Time Warner Inc and News Corporation, which offer different international media and entertainment. The company also faces competition from NBC Universal, which is owned by Comcast and offers television and studio entertainment. These other companies offer products, services and entertainment which rival that of Walt Disney and this it solves through acquisitions and merger with rivals. THE I&E MATRIX: The I&E plot strategy for Walt Disney shows that it is a company that takes advantage of its diversified products and services, but has problems in dealing with competition from other companies that provide similar services and products. The company therefore needs to deal with its internal strengths and weaknesses to maintain its niche in the market even in the face of a weak economy (David, 348). The company has the opportunity to grow through further diversification through entering international and new markets through mergers and acquisitions. It also has the opportunity of taking advantage of the changes in the manner of consumption by consumers and the technology and the increased uptake of the Disney Music Channel. The threats that would make an employee not want to associate with Walt Disney are that it has no way of retaining employees or recruitment of creative and innovative human resources. It is also affected by the changing manner of consumption of consumers, piracy, and disobedience to the intellectual property laws as well as decrease in the sales of its services and products. THE SPACE MATRIX: Walt Disney is in a stronger financial position as compared to its competitors in the market but has to cope with the segment taken over by these other companies as they also offer unique services and products to the market. This shows that Walt Disney Company must aggressively market its products with an aim of increasing its share in the market both domestically in the United States as well as globally in the international and emerging markets. In order to reduce costs and maximize on its profits, it can engage like-minded industries in foreign markets such as its relationship with UTV of India to tap into the markets that may be restricted in one way or the other. THE TOWS MATRIX: Walt Disney as a company must develop strategies that are aimed at changing its structure of organization other than the segmentation of its subsidiaries, development of its products and services and the changing of the manner that it produces and distributes its products (David, 210). The company should also embark on strengthening its horizontal and vertical integration, modify its products and services, and restructure the manner in which it diversifies its different arms in order to better penetrate the market. The company must find ways of dealing with the threats to its profitability such as finding ways of surviving during recessions or when taxes such as VAT are increased or that its customers have aged. These can be achieved by taking advantage of its opportunities through developing phone applications for their products and offering their services when there is a boom in the economy. The company can also add more services and products to their already diverse menu of products and services in order to maximize its penetration of the market and add more customers to its portfolio. By doing this, Walt Disney has the chance of strategically placing itself both domestically and globally as the leader in the products, services, information, and the entertainment industry. Work Cited David, Fred R. Strategic Management Concepts: A Competitive Advantage Approach. Boston: Pearson, 2013. Print. . Read More