ASSIGNMENT CASE STUDY ANALYSIS OF The Walt Disney Company

(With reference to course, MANAGEMENT PRACTICE AND ORGANISATIONAL BEHAVIOUR) (MGN 502) Submitted to: KRITI AHUJA Submitted by:
NAME
BHAVNINDER SINGH SUGAN KUMAR GEOPAL SINGH JAGAN BABU GURDEEP SINGH

Roll No:
A-10 A-07 A-08 A-09 A-11

DATE OF SUBMISSION: 10-09-2013

s. no 01

CONTENTS Introduction

Page. no 3

02

Summary

03

Problem face by Disney

04

Overcomes from problem

05

SWOT analysis

06

Question and Answer

07

Conclusion

10

Walt Disney
INTRODUCTION
The Walt Disney Company, together with its subsidiaries and affiliates, is a leading diversified international family entertainment and media enterprise with five business segments: media networks, parks and resorts, studio entertainment, consumer products and interactive media. Media Networks Media Networks comprise a vast array of broadcast, cable, radio, publishing and digital businesses across two divisions the Disney/ABC Television Group and ESPN Inc. Parks and Resorts When Walt Disney opened Disneyland on July 17, 1955, he created a unique destination built around storytelling and immersive experiences, ushering in a new era of family entertainment. More than 55 years later, Walt Disney Parks and Resorts (WDP&R) has grown into one of the worlds leading providers of family travel and leisure experiences. Disney Consumer Products DCP is the business segment of The Walt Disney Company and its affiliates that extends the Disney brand to merchandise ranging from apparel, toys, home dcor and books and magazines to foods and beverages, stationery, electronics and fine art Disney Interactive Founded in 2008, Disney Interactive entertains kids, families and Disney enthusiasts everywhere with world class products that push the boundaries of technology and imagination. Disney Interactive creates high-quality The Walt Disney Studios For more than 85 years, The Walt Disney Studios has been the foundation on which The Walt Disney Company was built. Today, the Studio brings quality movies, music and stage plays to consumers throughout the world. Feature films are released under the following banners: Disney, including Walt Disney Animation Studios and Pixar Animation Studios; Disney nature; Marvel Studios; and Touchstone Pictures.

SUMMARY DISNEY THROUGH THE YEARS:

After the first film business failed, they started a film studio in Hollywood in 1923. The first Mickey Mouse cartoon, Plane Crazy, was completed in 1928. Steamboat Willie, the first cartoon with a soundtrack, was the third production. The studios first animated feature film was Snow White in 1937. Fantasia and Pinocchio in the 1940s. Disneyland, the theme park developed largely by Walt, opened in 1955 in Anaheim, California. The television series, the Mickey Mouse Club, was produced from 1955 to 1959. Walt Disney died in 1966 of lung cancer. Disney World in Orlando, Florida, opened in 1971, the same year that Roy Disney died. His son, Roy E., took over the organization. However, the creative leadership of brothers Walt and Roy Disney was noticeably absent. Then Roy E., took a decision to bring in new CEO Michael Eisner from Paramount pictures.

ABOUT THE NEW CEO- MICHAEL EISNER:

Michael Eisner is who work through a combination of hard work and timely decisions, which makes him to move the organization from the last place to the first place. Eisner wanted to extend the brand of the Disney products through a number of avenues.

PROBLEMS FACED BY DISNEY:

In early 1990s, an attempt to build a theme park in Virginia based on a civil war, the theme was defeated by local political pressure. Euro Disney, the firms theme park in France, resulted in over $500 million in losses for Disney due to some miscalculations. In 1994, Eisner had undergone an open heart bypass surgery. Due to Eisners illness, there was a change in CEO, but other than Eisner none can withstand that position for about a certain period of time. Eisner ushered in a new era at Disney by announcing the $19 billion takeover of Capital Cities/ABC on July 31, 1995. The deal came in the same week as Westinghouse Electric Corporations $5.4 billion offer for CBS Inc. During the period of Brand investment in early 2001, the Company loses hundreds of millions of dollars on downscaling its internet sites. Disneys net income had decreased to half, from $1.85 billion to $920 million. The Company had a net loss of $158 million on operating revenue of $25.2 billion.

OVERCOMES FROM THE PROBLEMS:

Disney Company concentrated on developing its brands. During 1990s, Michael Eisner said that it sounds funny, but I am thinking about the millennium change. I have to protect the Disney brand well into the future. To build the brand- Disney, the Company included media networks, studio entertainment, Walt Disney parks and resorts, and consumer products.

SWOT ANALYSIS:
Strengths (S) Diversification of their products and services-produces balance revenue streams Well known characters Widespread cable networks Strong brand name-ranked 9th in top 100 brand names Integration Cross marketing Weaknesses (O) Negative work environment - micromanaged High attrition amongst senior executives Slump in films and media division Overdependence on the North American markets 75% of revenue is derived from North America market Little presence in emerging Asian Markets; accounted for only 6.7% of company's revenues

Opportunities (O) Improving presence in emerging Indian and Asian markets Agreement with DreamWorks to distribute six films a year Positive market outlook for the global media International expansion Newer technologies such as DVDs and Internet Growth through acquisition Threats (T) Headhunting of employees Competitors: National, Regional & Global Employee Retention Highly Demanding in terms of Sales, Creativity and Innovation Brand Consistency Product Differentiation

QUESTIONS & ANSWERS

1. Examine the Internal and External forces for change faced by Disney? The Internal Changes: Walt Disney died in 1966 of lung cancer. In the year of 1971, Roy Disney died. His son, Roy E., took over the organization. However, the creative leadership of brothers Walt and Roy Disney was noticeably absent. Then Roy E., took a decision to bring in new CEO Michael Eisner from Paramount pictures. In 1994, Eisner had undergone an open heart bypass surgery. Due to Eisners illness, there was a change in CEO, but other than Eisner none can withstand that position for about a certain period of time. During the period of Brand investment in early 2001, the Company loses hundreds of millions of dollars on downscaling its internet sites. Disneys net income had decreased to half, from $1.85 billion to $920 million. The Company had a net loss of $158 million on operating revenue of $25.2 billion. Finally the Walt Disney Company to the financial success, in Fiscal 2002, the Companys net income was $1.2 billion on operating revenue of $25.3 billion.

The External Changes: In early 1990s, an attempt to build a theme park in Virginia based on a civil war, the theme was defeated by local political pressure.

 Euro Disney, the firms theme park in France, resulted in over $500 million in losses for Disney due to some miscalculations.

Eisner ushered in a new era at Disney by announcing the $19 billion

takeover of Capital Cities/ABC on July 31, 1995. The deal came in the same week as Westinghouse Electric Corporations $5.4 billion offer for CBS Inc.

2. How have external force in the entertainments industry affected Disney need for changes? Disney represented one of the several consolidation of media conglomerates that increasingly control the distribution of entertainment programming in USA. Disney ranked as 3rdlargest media conglomerates behind AOL time warner and Viacom. Eisner appreciated the importance of both programming content and the distribution assets needed to deliver it. As a result of many of Eisner decision, the walt Disney company has been transformed from a sleepy film production studio into major entertainment giant. The revenue of over $2billion in 1987 increasingly to $22 billion in 1997. Its stock price has multiplied over 15 times, creating enormous wealth for both stockholders and executives of Disney. One of the biggest questions arising from the ABC deal is whether Disney paid too dearly for declining network assets. Viewership among all the major networks was declining. According to Michael Jordan, the CEO of CBS, the pure network television business is basically a lowmargin to breakeven business.

 The networks were squeezed by having to pay extravagantly for programming and were attracting an audience of older viewers who were scorned by advertisers. 3. What changes do you foresee in the entertainment industry in the next 5 years? Use of Robotics. Moving to more technology based films. There will be the science fiction related to going to the far land. Live performance- Using the internet services. Increase in more creativity. Attracted by all the viewers. They can gain more through the entertainment industry. Advanced knowledge.

CONCLUSION:
The Company had concentrated only in maintaining strong and differentiated brands, mainly such as Disney and ESPN brands. In the track of business, these brands are more powerful because they are unique and can be differentiated from other products, and they are relevant to the consumers. Finally the brand building helped the Walt Disney Company to the financial success.