Environmental Analysis of Disney - Case Study Example

The main challenges faced by Disney will be changing technology and constant need for technological innovations, strict environmental laws and regulation demanding safe and clean production. Demographical factors will change traditional target audiences and require new planning and market segmentation. Industry environment will be affected by (1) fierce competition, (2) new industry structure and (3) globalization of the entertainment industry. The view of competition as market power no longer suffices in the long run.

This is due to the fact the survivors of decades of fierce global competition all seem to be converging on similar and formidable standards for product cost, quality, and timeliness. In this case, Disney managers need to look at the internal competencies of their corporations to secure long-term survival. Operating environment will be affected by (1) 'know-how' business solutions and (2) rapid growth of the Internet and e-commerce. The main changes will affect operating environment and will help the company to create competitive advantage, improve sales and performance management.

For the innovation of new ideas to be successful a high degree of integration is needed between all concerned (e.g. engineering, production management and marketing). Change process is closely connected with the integrity perception which is built into their way of doing things, a 'passion for integrity' which applies to employees, customers, suppliers and other audiences such as the community (Vogel 2007; Walt Disney 2007). In order to compete during the next 10 years, Disney should take into account global business environment and technological innovations which have a crucial impact on this sector.

The most important factors for long-term plans include changing life style of consumers and demand patterns (Walt Disney 2007). The main long-term objectives will be the following:(a) Disney should create and support multicultural environment for its entertainment programs in order to meet changing consumer demands and resist competition. Such phenomenon as cultural globalization receives the development from technological revolution and economic globalization which together create a stream of the cultural blessings.

Modern consumers are driven by world entertainment trends rather then national ideals (McDonald and Christopher 2003). (b) Disney should respond to demographical changes and segment its consumers according to their life style and a country of origin. Changing patterns of demand and more sophisticated tastes are expected over time and Disney should be in the marketplace ready to supply them. One of the means by which Disney can create market penetration is through the creation of its own distribution facilities around the world. (c) The next objective is global penetration and expansion.

The Internet and increasing number of users in Asian and African countries will represent unlimited opportunities for this sector. For its product line, Disney should buy up retail outlets and making strenuous efforts to build a retailing network, which, apart from the immediate financial advantages, facilitates the marketing of their products. Disney should internationalize through cross-border mergers and takeovers. Disney will gain from reduced