The Movie Industry - Essay Example

Risk Analysis: Movie Industry The movie industry is one of the most fast-paced industries in the world, continuously changing and altering the way that it operates. It is also one of the riskiest industries because of these constant changes, as very few people know what may become of the industry at any given time. The movie industry is one of the biggest industries, especially in regards to the entertainment industry as a whole; while there may be other industries in the world that contain more people, it is the movie industry that has the biggest impact on the people that are involved with it, whether directly or indirectly as a consumer. In Hollywood, thousands of movie ideas are optioned each year, but only twelve to twenty-four movies are actually created and released to mainstream theatres. There is no scale or ranking that decides which movies do make it to production and which do not; it all depends on the people that pick them up. The movies that do make it, however, do not always guarantee a success in the box office. Quite the contrary, less than half of the movies released in movie theatres do well in the box office, hardly bringing in the money that was made to produce the movie. The most important goal of every movie is to bring on more money than they spent. If the movie made more in theatres than it cost to produce, than the movie is considered a success; if it brings in less, it is considered a failure. This all depends on the appeal towards the intended audience. As with any industry, the film industry is constantly under threats of many sorts, including financial, operational, technical, natural, and execution. These aspects are part of the ever-changing industry, constantly keeping employees on their toes. As rocky as the film industry is, it is nothing compared to how rocky the threats can be. What may be an industry hazard one day might not even be on the minds of the employees by the next day. The financial threats that the film industry is facing right now has to mainly do with the failing economy. Money is the most important aspect of the film industry - without money, there can be no employees to create movies, therefore no movies, so a huge portion of the entertainment industry is slowly but surely facing the same financial crisis as other industries. Prior to the recession, the film industry was constantly flourishing with new employees and new opportunities; the employment rate was larger than the unemployment rate, which was almost nonexistent. In the film industry, the only way a person could get fired is if they royally messed up a project, losing money for the production. With this threat in mind, there are seldom such large mistakes; once your fired from the film industry, you cannot come back. Business failure within the film industry, while entirely possible, is something that is also difficult to arrive at. Business within the film industry, even regardless of the recession, is still strengthening as it has been since the first movie was created. The film industry consists of two branches: mainstream and independent. Even if something drastic were to happen to the mainstream film industry, such as the failing economy making it impossible to get people to sponsor and finance a film, the independent portion of the industry still has what it takes to produce films, since it does not depend so much on the help of others to get movies produced. Other financial threats can be seen while a movie is being produced. Each movie is granted a budget, though it has become common that most productions go over this budget. There are special types of insurance for these cases, in which the producer and the director are not troubled too much if they go ever a certain limit. However, if they do exceed the limit by too much, then the production is taken over and shot for less. When money is taken to cover the extra expenses, that is less money for another film, which, if constant, can be damaging to the film industry. In regards to operational threats, the film industry constantly faces a disruption to their supplies. There is often so much going on that they cannot get everything they need for every separate project. Though they do pull together to get what they need, it ends up being financially damaging. The only perk is, though, that once they obtain the extra supplies they need, they are already around if needed again. There can also be problems if they lose their assets; people do leave the industry on their own accord, causing delays in projects that are ongoing or are waiting for the green light to move ahead. Without these people, productions must be halted until they can be replaced. The film industry is one that is run by the increasing of technology. The more that technology grows, the more that the film industry is able to accomplish. Though it is expensive to do so, the film industry hardly bats an eye as they keep up with the constant changing of technology, from cameras and lights to editing systems. Once something has been approved upon, it is bought; all the same, the older item is not replaced but remains in use, as some of the older things still function better than the newer ones. The technology the film industry uses now is nothing at all like what it used when silent films were first being produced. Since the film industry depends greatly on technology, it is quite obvious to assume that they definitely have their technological failures. Even the most expensive piece of equipment has its flaws, and these flaws normally do not show themselves until the piece of equipment is about to be used. When this happens, especially while on a shoot, the film crew must be prepared to replace the piece of equipment with either the same model or with a backup, which tends to be the model that was replaced with the newer piece. Technological failures in the film industry are a very common thing, so most film crews are prepared in the case that something does happen. Unfortunately, even if it is a minor disruption, it still takes time off of the shooting day, which, in turn, costs money that the film crew did not intend for. Natural threats are almost as common as technological ones within the film industry. When it comes to filming, natural threats are something that can never be estimated enough, so there is hardly very little that can be done if something were to happen. There are many variations of insurance that cover filming time and, in some cases, money lost due to lost filming time, if a natural event were to happen, such as a weather event or someone getting sick. Some things, however, are not covered; when considering what is covered, the film industry looks to what can be considered "acts of God," natural occurrences that simply cannot be avoided. Accidents, unfortunately, are not something that are as easily covered as weather conditions or illnesses. There are other insurances to help with accidents, but very few to help cover what was lost during the shooting day. Due to the long workweeks of those in the film industry, illnesses and accidents must be taken into account, since they occur almost on a daily basis. They are aspects that need to be prepared for to avoid unpleasant surprises. Execution threats, in regards to the film industry, can be seen most in organizational issues. Organization is one thing that the film industry greatly lacks, even when organizing anything is attempted. Nothing is ever set in stone and surprises are more acknowledged than things that were actually planned. While many filmmakers have been able to live and work around this harried method, it still effects them negatively in terms of money that is being wasted when plans must be changed at the last moment. Despite the amount, or lack thereof, of organization, there are still deadlines that must be followed and are often ignored, disregarded, or forgotten because something needed to be done that was not planned for. In the film industry, it is important to be prepared for everything, so that there is always time to spare. The financial threat will always be high for the film industry, regardless of the shape of the economy. The film industry simply needs money to function, yet millions of dollars are spent to make a single movie. When they do not make back the money through box office sales, then they are setting themselves back. The level of operational threats can be considered low, as there are always different replacements, whether it is for a camera or for a director. When push comes to shove, the film industry makes due with what it has. Technological threats can be viewed at as a medium level of risk; while the film industry has no problem with keeping up to date, they still need to be aware of their spending on newer, better equipment, especially when they older models they have are just as good. The constant spending on newer equipment can eventually put a dent into the overall filmmaking budget. The level of risk for natural threats would be high, since none of these threats are predictable and can end up causing a lot of damage. The less something is predictable, the more negative effects it can end up having. The execution threat can be seen as a high risk for the same reason - when people are not prepared, and not just in the film industry, the consequences can become just as uncontrollable. Overall, the best way the manage any of the risks that might make themselves known in the film industry is to simply prepare for whatever the worst case scenario might be. Financially, Hollywood needs to be ready to decrease how much it costs them to produce a movie; operationally, the industry needs to know who or what to depend on immediately if a prior arrangement does not work out; technologically, they will have to become used to the equipment they have and depend more on what they have than on what they do not need; naturally, they just need to understand that anything can happen without so much as a moments notice, and they must be prepared to react as such; and in terms of execution, gaining some organizational skills throughout the entire industry might prove to be the most helpful thing. It could prepare the entire industry for any of the aforementioned risks, making it easier to cope with any of them. I can effectively communicate the risk analysis to various stakeholders and other managers for all affected parties to understand the process of and generated information about the risk analysis by first breaking down the various causes that can turn into these risks. I feel that the risks would be easier to understand if people first understood how they first came to be about. I would then explain the relationships using cause and effect; hopefully people will also be able to understand why some things happen outside of the control of a group, a company, or an industry as big as film. Read More