Strategically modified adjustment to Disneys media network/value chain

The Walt Disney Company is a company with five types of the networks that is media, parks and
resort, consumer products, interactive and studio recreations. It is successful company that
generate $42.3 billion in 2012 that 3% higher from 2011.
According to the Disney media repot 2013 the main issue with the value chain is the presence of
unauthorized access to the intellectual rights of the company. With advancement in the
technology and growth of more leisure time marketing they face many challenges for the sake of
maintaining their competitive advantage in the market. Availability of the product at DVD, blue
ray CDs, video recorders and web based entertainment distributions affect the revenues amount
generated by the company.
Now making of media products like dramas, movies and sitcom and related supplements become
easier as compare to maintaining the intellectual rights of the company. With the passage of time
new entrant and rivals came in the market who gives tough time to Disney media.
Assets test is that how they able to maintain their goodwill and high market share in the existing
market situation?
Its answer lies in the successful management of Value chain; the key that help them get their
desire destination.
Value chain is actually a competitive advantage that helps the firm in setting their core
competence as plus point over other companies. It is best define by porter as
It is a Synchronized process of getting competitive advantage and core competence by a
business (Antoniou et al.).
Porters generic model of supply chain

Porter tries to represent the concept of value chain as to make clearer what the customer wants.
As concern with the Disney media network it value chain or competitive advantage depends
upon the taste of the customer, advancement in the technology and economic condition of the
country. Value chain will act as an automatic device in the identification and resolution of issue
that would be play a crucial role in the success of the company.
It is basically a combination of nine primary and secondary (supportive) activities. Primary
activities include synthesis of the product, its marketing and delivery to the target consumer for
the sake of gathering some value in return. While secondary activities are done at the part of
company organization and its infrastructure. This is clearly explained by the model of generic
value chain.

Fig: the generic value chain

With the above model it is obvious; if the company distort its primary and secondary
(supportive) activities in to nine sublevels. They will be in more good position to understand the

importance of each level and its potential worth in setting the competitive advantage by the
company.
Strategic problem in Disney media value chain
As for concern with the Disneys media network this strategy will be help for them to find out
the pitfalls that result in bullwhip and discrimination of their intellectual rights. Downstream
activities which also include marketing are more nearer to the customer activity should be carried
out at demographic level in a decentralized fashion. Because Disneys media is an international
organization and every region have different taste of viewer ship. This strategic model shows the
importance of value configuration in the media industry. That is adaptation according to the taste
of every new country. Upstream activities as obvious in the figure should make centralized with
exception of HR because these are done at domestic level.
The problem is lies within the marketing and more technological advancements on the behalf of
the company. If company gets more control on the intellectual rights and flaws in the marketing
they will generate more revenue and less risk of being imitated by the competitors. Musa 2012
described the factors in the failure of the company and loss of competitive advantage in the
industry.

Timing

Finance

Information

Shortage in the supply of raw material

Choosing bad channel of marketing

The use of the resources at the right time from right window and with ample amount of the
information about the taste of target market can play a role of mile stone in the success of time
oriented opportunity availing industry.

Management strategic model for the resolution of the problem

Disney media network problem can be solved if they modify the generic value chain according
to the current needs existing in the media marketing. Basically there are three problems that
cause

uncertainty

in

media

marketing

or

in

any

business

these

are

supplier,

processes/manufacturing and demand (Peidro et al. 2009). If company focus on suppliers,

channel of delivery (broadcasting media) and customer choice more vigorously all these levels
will results in the generation of more margins i.e. money or benefits. In media industry rating and
sponsorship is the only key that decides about the success or failure of any venture. If we modify
the porter generic model like following diagram. Media industry gets more benefited.

Fig: modified value chain model for Disney media network

This includes supplier value chain, channel value chain and customer value chain that link with
each other via organization value chain. Organization directly focuses on the variety of suppliers
and channels of delivery there will be no issue of imitation and low interest by the viewer
(ultimate customer). Instead each level will generate the margin in terms of monetary benefits
and risk of bullwhip will be diminished. This is good knack that strategically gives solution to
the problem at corporate level.
Tayur et al. 2003 had support the discrete time module for such type of the organization. Because
Disney media assets are their intellectual rights (trade marks, sign, symbol etc.). It is like the
time bucket each and every program go through the growth and after certain period of time it
will obsolete from the product line.
Solution to problem:

If the management done acquisition, merger or joint venture with other successful media industry
it will result in the huge gain of popularity and success of the company e.g. Pixar and Marvel, is
the media network that acquire by the Walt Disney for the support of their bountiful media work.
Following strategic model will more help the company in the gain o competitive advantage and
establishment of the successful value chain.

Fig: strategic option for maintaining market stability

It is the structure of the organization, its technocratic and individual employees who directly
coordinate the activities and play their role in the success of the company at international level
(Kutschke and Stefan 2008).

References:

Antoniou, P. H.; Levitt, C.E.; Schreihans, C. managing value chain strategy. Journal of
management and marketing research. Available at
http://www.aabri.com/manuscripts/11835.pdf
Kutschker and Stefan (2008). Internationals Management. 6th. Oldenburg, Munich,
Vienna,
schmid, S. and Grosche, P. (2008). Managing the international value chain in the
automotive industry. Strategy, structure and culture. Germany. Available at
http://www.escp
eap.eu/uploads/media/Managing_the_International_Value_Chain_in_the_Automotive_In
dustr.pdf
Musa, S.N. (2012). Supply chain risk management: identification, evaluation and
mitigation techniques. linkoping studies in science and technology. Sweden. ISBN:97891-7519-866-8
http://liu.diva portal.org/smash/get/diva2:535627/FULLTEXT01.pdf

Tayur, S.; Ganeshan, R. and magazine, M. (2003) Quantitative module for value chain
management. 6th ED. Kluwer academic publishers, USA.

The Walt Disney Company. Fiscal year 2012 financial report and share holder letter.
http://cdn.media.ir.thewaltdisneycompany.com/2012/annual/10kwrap-2012.pdf

Peidro, D.; Mula, J.; Poler, R.; Lario,F. (2009). Quantitative models for supply chain
planning under uncertainty: a review. Int J adv manuf Technol. Pp 400-408. DOI
10.1007/s00170-oo8-1715-y