Case Study Written Report

Republic of the Philippines
Polytechnic University of the Philippines

COLLEGE OF BUSINESS
Sta. Mesa, Manila
Submitted by:
Group 1 bsbahrdm 4-4n
Altura, jesselyn gem
basio, april joyce
Asauro, jerome peter
belazon, jheansen
Ayala, spencer
benigay, donnabel
Ayco, jeane claude
betchaida, jewel ann
Submitted to:
Prof. Melinda Del Mundo De Guzman, DBA
Case study
of
Walt disney co.
Table of contents
Table 2
Step 1 : gaining familiarity
.......................................................................................3
- History
- Structure
Step 2 : recognizing symptoms
...........................................................................6
Step 3 : identifying goals
...........................................................................7
- Walt Disney goals
- Michael eisners goals
Step 4 : conducting analysis
..........................................................................9
Step 5 : making the diagnosis
..........................................................................12
Walt Disney | CASE STUDY
Page | 1
Step 6 : doing the action

planning.............................................................................13
Table 3
i.
Strategic profile
and case analysis
purpose..15
ii.
Situation analysis
...........................16
- GENERAL ENVIRONMENTAL ANALYSIS
- INDUSTRY ANALYSIS
- COMPETITIVE ENVIRONMENTAL ANALYSIS
- INTERNAL ANALYSIS
III. SWOT ANALYSIS
..........................................................................27
Iv. STRATEGIC FORMULATION
..........................................................................31
-
STRATEGY ALTERNATIVES
ALTERNATIVE EVALUATION
ALTERNATIVE CHOICE
STRATEGIC ALTERNATIVE IMPLEMENTATION
An Effective Case Analysis Process
Step 1: Gaining Familiarity
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The
Walt
Disney
Company,
diversified multinational massmedia and
commonly
known
entertainment
as Disney,
conglomerate
is
an
American
headquartered
at
the Walt Disney Studios in Burbank, California. It is the world's second largest media
conglomerate in terms of revenue, after Comcast. Disney was founded on October 16, 1923,
by Walt Disney and Roy O. Disney as the Disney Brothers Cartoon Studio, and established
itself as a leader in the American animation industry before diversifying into live-action film
production, television, and theme parks. The company also operated under the names The
Walt Disney Studio, then Walt Disney Productions. Taking on its current name in 1986, it
expanded its existing operations and also started divisions focused upon theater, radio,
music, publishing, and online media.
HISTORY
Walter Elias Disney was born in Chicago on December 5, 1901. Walt was one of
five children and came from a family that encouraged hard work and tight purse
strings. As he was growing up, Walt amused himself by drawing. At the age of 14, he
enrolled in the Kansas City Art Institute and began making small animated films.
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However, Walt never made any profits from the films because he lacked financial
knowledge and business acumen.
In 1923, Walt moved to California to join his brother, Roy Disney. Together they
began producing animated films. Their first major hit was Oswald the Lucky Rabbit.
However, to continue to produce these films, they had to borrow money from a New
York distributor. As the character became increasing popular, the costs to produce the
films increased. Therefore, Walt asked the distributor for a raise. Instead receiving a
raise, Walt was told that he did not own the rights to Oswald, the New York distributor
did. So, Walt and Roy developed the now-famous Mickey Mouse character.
To develop Mickey Mouse, Walt and Roy formed a partnership in which their
mission was to provide the public with a quality product. However, their plans were
often bigger than their resources and they had to take Walt Disney Productions public
in 1940. Walt Disney Productions was known for taking risks and striving continuously
to venture into innovative forms of entertainment. With the support of the growing
Walt Disney Production company, Walt and Roy decided to open a theme park in 1955
called Disneyland Park. This park introduced a whole new form of entertainment, the
outdoor theme park. As a result, the company began to be perceived as being on the
leading edge of the entertainment industry.
STRUCTURE
Walt Disney operates using a Strategic Business Unit (SBU) organizational
structure that consists of five diverse family- entertainment segment: Media Networks,
Parks and Resorts, The Walt Disney Studios, Disney Consumer Products and Disney
Interactives.
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Step 2: Recognizing Symptoms

Strategic Challenges and Questions
The Strategy of Michael Eisner of Acquiring ABC had opened doors to Walt Disney
Co. in many series of opportunity. The Acquisition first led to immediate return of the
used capital, thus, giving them another power to use it for another investment. This
opportunity directed Walt Disney in opening ESPN shop, new theme park and also
Cruise line. However, the acquisition did not only bring opportunity in the company but
also it brought threat. As their acquisition became a success, the strategy became a
mainstream in the world of entertainment industry that time. In short, other company
started to do the same and that was when problem began in Walt Disney Co. The
competition rising between companies in the entertainment industry had brought great
impact in Walt Disney. First, the great impact was the sudden fluctuation of profit of
Walt Disney Co. by the time the rating of ABC channel started to drift when its other
rising competitors began to engage in bringing out something new in the market. Next
is the entry of new film/cartoon making competitors and the opening of other new
theme park which became the rival of Disney in catching the eyes of the public. The
other one is the effect in Walt Disney shops, the declination of sales because of Walts
lacked of producing more hit films. So the main problem is: How will Michael Eisner
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strategize his new affiliates as well as the new Walt Disney Co. to compete strongly
with its rising competitors and maintain its reputation in the market? Should they
continue to acquire new assets or should they try exploring the other side of the
entertainment business?
Step 3: Identifying Goals

WALT DISNEY GOALS
Their mission was to provide the public with quality product. The company began
to be perceived as being on the leading edge of the entertainment industry.
Brand Image, needed to compete effectively in a diverse environment and
mission of the network remains in an instantaneous way to achieve a distribution
channel for the mega-media players such as Disney.
Disney's film and television division had numerous successes in 1996. Eisner's
goal was to reinvent this division.
Disney plans to reduce the number films it releases annually. This strategy will
allow Disney to focus on releasing more "high-impact, star-driven films with
greater potential.
Disney Online's goal is to increase the firm's presence on the World Wide Web via
its two Web sites, Disney.com and Family.com.
MICHAEL EISNERS GOALS

He must formulate a growth strategy.
He must continue to create synergies between each of the divisions and find
ways to integrate ABC.
He must develop successors that can continue Disney traditions and growth in
his absence.
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His goal was to "continue to nurture and protect the Disney brand and to reaffirm
core values such as our commitment to quality and service. His first priority was
to revamp Disney's film and production division and develop original and
creative full-length animated films. And he also turned Disney into a premier
entertainment giant with enough revenue and power to acquire Capital
Cities/ABC.
He expected to increase with the 1998 addition of another theme park at the
Walt Disney World Resort in Florida, Disney's Animal Kingdom. He also expects
Disney to profit from the company's addition of a Wide World of Sports Complex
in Orlando.
Other Firms Goals

Federal Communications Commission, as an industry deregulation the bill will spur new
investments in cable-TV systems and TV stations. This is critical to cable providers
because they are now able to expand cable line ups and move in to the telephone
business, this increasing competition. Themegamergers such as the Disney/Cap
Cities/ABC merger took at this time.
Step 4: Conducting Analysis
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In this case study, we found out and reflected the strategy, theories and models that is
aligned to Walt Disney Co.. First is the dreamer, The realist and the critic Strategy of
Walt Elias Disney, next, is The Situational type of leadership of Michael Eisner.
The dreamer, the realist and the critic strategy.
The dreamer. Usually, any creative idea starts with a dream full of passion and
enthusiasm. In ordinary meetings, this dreaming style is halted by reality and does not
have the space to go further on. Discussed in details. in this Disney Creative Strategy,
the first stage allows the team to share their dream without no restrictions or criticism.
This helps to build a pool of creative ideas. Some of these ideas are viable and others
are not. Determining the viable creative concepts comes later as a result of the second
and third thinking styles.
The realist. Now, subsequently, follows the realist style. The team switches the place
and mode to think in a more logical planning style. Based on the first stage, the
attendees pretend that the dream is possible and start putting plans to achieve it. The
plans aims to turn the imaginary ideas into a manageable action plan. During this
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stage all the thoughts should be constructive and target turning the idea into a real
plan.
The Critic. After having an action plan to turn the idea into reality, the critic thinking
mode tends to discover the barriers of applying the idea and how to overcome it. In
this session, the team provides a constructive critique for the idea in order to find the
weak points and solve it in the final solution.
As a result of the three main stages above in Disneys Creative Strategy, the team
reaches a solid creative idea with an action plan to apply it. The first stage focused on
the creative aspect and sharing creative ideas and solutions. The second stage focused
on reality and how to turn the idea into an action plan and finally the third stage aims
to identify the weakness in the idea and overcome it in the final plan.
As for Michael Eisner Leadership, one theory that reflected to it is the Situational
leadership theory. Situational Leadership theory, leadership were developed to find
good ways of adapting leadership actions to meet the needs of different situations and
circumstances.
One classic situational model of leadership ( Hersey & Blanchard ) is concerned with
identifying the ability (or competence) and willingness (commitment or motivation) of
those being led, and then determining the best style of leadership to follow.
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Leadership style here refers to the broad approach adopted by a leader. A leader's
style of leadership is often based on a leaders own beliefs, personality, experiences,
working environment and the situation at the time. Some leaders work within one
leadership style. Others are more flexible and can adapt their style of leadership to
meet the needs of different situations.
Step 5: Making the Diagnosis

Despite the fact that Walt Disney has turned into a premier entertainment giant and
has gained its competitive market position over the years, it also faced several
problems. Those problems are the strategy of Walt Disney for expansion by means of
acquiring other potential asset company which has been imitated by their competitors.
Because of this emerging trend of acquisition, production of new programs and
innovation in the entertainment industry has begun, which actually caused Disney
another problem in maintaining its position in the market. Another problem was when
Disney acquired ABC as their official network. The rating of it has declined for the
following years which also resulted to another problem that Disney has to resolve
because of the chances that the ratings of it will affect the companys future. Another
problem that Disney had faced was the misunderstanding that happens on the part of
the retailer. They see Disney films can no longer produce a guaranteed hit which was
the contrary of what was Disney planned and that was to produce a high quality
animated films by means of reducing the film they produce annually.
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Step 6: Doing the Action Planning

Based on the case study we think that Walt Disney Company is already
successful and stable in the world of business. The popularity they have gained over
the years had made them powerful in the industry. The strategy of acquisition which
they did when they acquired ABC as their official network has helped them to
strengthen Disney and also gave them a great opportunity to stay on the tract and
reached the pedestal.
The only thing that we think is the hindrance for Disneys success during that
time was the unclear leadership in the part of ABCs management. The management
was being manipulated by Eisner even though Jamie Tarses has the position already.
He intervened and appointed another president of ABC and that is Bob Iger. Bob Iger
became his eye and ear over the company and it turns out that Jamie Tarses was just
the figurehead of the company without really having the power over it. And because of
what Eisner did to the management it results to the employees confusion on whos
they are going to follow. For us, Eisner shouldnt have done that. Right from the very
start he should have fired Jamie since they dont share one common vision and goal.
Another thing that Disney has to work on is that they should provide high quality
with great potential films such as family oriented and child friendly films. They should
not be too confident with their current status in theme parks and continue to strive for
better attractions and rides. All in all Disneys administration is excellent. Eisner did a
great job on supervising and leading Disney to success.
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General Outline for an Oral or a Written Presentation

Table III
I-STRATEGIC PROFILE AND CASE ANALYSIS PURPOSE
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After the death of the founder of Walt Disney Co., Walt Elias Disney, the executives
managed the company independently to avoid it from being purchased. Luckily, before his
death, he had managed to train and shared his vision with some of his people so even when
his gone his presence is as if never left the company. However, a big shoes was still not that
easy to fill. As time passed by, changes were started to occur and the stability of the
company had started to declined. And before the company had lost its touch, Michael Eisner
had popped into Walt Disney Co.s big picture.
By the time Michael Eisner became the CEO of Walt Disney Co., he had reinvent the
film and production division ventured into new businesses and turned Disney into a premier
entertainment giant with enough revenue to acquire ABC. With the acquisition, numerous
opportunities had fall in hand of Michael Eisner that made Walt Disney more competitive.
Such opportunities includes the opening of ESPN store, Club Disney and the companys entry
to World Wide Web. The aforementioned opportinities had been one of their edge and
advantage to strongly compete against their rising competitors and have their niche in the
market. However, with the acquisition, the companys organization had diversified
completely which brought a major disorder in the harmonous organization theyd strongly
built. Eventually, changes occured not only in the organization but also in the performance
and marketing strategy mostly in Disneys affiliates, thus, gave a major threat in Walt
Disneys growth. Also, the success part of their acquisition had brought fire in the
competition in the market resulting for other firm to do the same and join the the race with
disney.
The chaotic occurence inside Walt Disneys organization and the continous ascending
of competition in the market pushed Michael Eisner in the brink of his major role in Walt
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Disney Co. which made some of their investors put a great questions about his marketing
strategy.
The purpose of this case study is to analyze the current internal and external factors of
the evolving entertainment industry. As a result of the environmental analysis, several
strategies and alternatives to meet these demands will be explored.
II- Situation Analysis

A. General Environmental Scanning
Political Factor:
One political factor that affects Walt Disney Co. to globalize was the implementation of
the Communication Act of 1995 which permits companies to own more than one station in
a marketplace and increases the allowed viewership of a station group to 35% of the
national audience.
Implementation of the Telecommunication Act of 1995 played a role in redefinition of
the communication industry states that any newspaper-broadcast cross-ownership is
prohibited.
Global Environment
Acquisition of other company to Disneys competing firms and developing them lead to
greater competition, hence, affect Disney to fully dominate.
Sociocultural Environment
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The mission of Disney brothers was to provide the public with a quality product.
B. Industry Analysis
Trends
Acquisition as a prime strategy practiced by Michael Eisner to Walt Disney Co. lead to
diversification and expansion of their organization, thus, let them acquired new
distribution abilities.
Technological
There are numerous products to buy online for Disney. There is a website with games for
parents and children to visit and enjoyed together, TV shows, and much more involving
technology. They own numerous media groups and continue to reach out to customers by
using technology daily.
The Walt Disney also has a division that uses its cutting-edge creative, technical, and
development abilities to update the appearance and design of all the theme parks and to
create-edge and creative themes for the new resorts.
PORTERS FIVE FORCE MODEL
Threat of New Entrants
Since the Walt Disney Company has been able to find a very unusual niche within the
industry, the entrance barriers are high relatively. The company is able to grow over a
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long term period, and has to develop from the departments of Human Resources,
Research and Development (R&D), Marketing, and Finance. By depending on past
experience, the company officials know to a large extent what the target customer wants.
Threat of Substitute
The products or services are moderate to low. Other cartoon figures, theme parks, and
movies can search the market in which the Walt Disney Company is operating in, but this
is obviously representing a significant threat. The Walt Disney Company has placed price
controls on many of its product lines already, and should be able to cope with other new
competitors. However, by upgrading products and services, the threat alone of new
entrants into the market requires the Walt Disney Company to hedge against such risk by
simultaneously.
Bargaining Power of Suppliers
The suppliers are governed by a few companies as the Walt Disney Company is operating
in a highly differentiated and unique industry with high switching costs associated with
operations. Besides, they are most probably very concentrated. However, the Walt Disney
Company is a unique company and important customer of many suppliers. Furthermore,
the size of the company may be a great advantage certainly. The company will create a
dependency relationship in the industry by being able to order large volumes of unique
products from unique suppliers.
Bargaining Power of Buyers
The bargaining power of buyers is high in the service and in the entertainment industry.
The customers have powers certainly since a large number of customers are needed to
make the Walt Disney Company's operations run smoothly. For example, if the price on a
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particular home video is too high, customers may be opposed to spending the money
needed to purchase the products. A majority of the Walt Disney Company's product mix
focuses on intangible returns of the buyer's money. However, some customers may not
realize that they are getting such a return may increase the bargaining power of the
customers.
Rivalry among existing firms
It does not play a very important role in the Walt Disney Companys external
operational environment. Nevertheless, it is tue that the companys exit barriers are
extremely high. Furthermore, the capacity is expanded
in extremely large investments.
However, there are no closer direct competitors to the Walt Disney Companys operations.
Competitors such as Looney Tunes retail stores do not appear to appoint themselves to
expensive advertising campaigns in order to obtain market shares. Moreover, the Walt
Disney Companys products are highly differentiated. The switching costs are therefore quite
significant. A multinational corporation such as Walt Disney Company faces internal
weaknesses and strengths, which can to a certain extent be controlled. The external forces
such as opportunity and threats are more difficult to control, and the Walt Disney Company
has to adopt and take advantage to those forces.
C. Competitive Environmental analysis

Walt Disney has 5 primary competitors namely: Time Warner, News Corp. (FOX),
Viacom (paramount pictures), Westinghouse, and General Electric (NBC).
Turner Broadcasting merged with Time Warner in 1995. Time Warner journalists and
artists create one new product for every-half hour of the day, they believe it creates value
Page | 17
through three interlocking fundamentals: creativity, libraries, and branded content

combined with branded distribution. In the acquisition of Turner Broadcasting, CNN and
award-winning journalist now a part of Time Warner family this also complements their
large publishing arm. TW gains access to more cable channels through brand name
recognition provided by TNT, Cartoon Network, TBS, and HBO.
News Corp. Is a worldwide media conglomerate, established by Rupert Murdoch
Chairman and CEO. He utilize FOX as a television deistribution outlet that leads to be the
fourth player in the network television market. With this, they use the strategy of
producing such popular shows as The Simpsons, Married the Children and COPS that
caught the viewers tickle and get a high degree of ratings in the market. This network
also enhance its legitimacy with the procurement of National Football League and Major
League Baseball television rights. They acquired Los Angeles Dodgers and Pat Robertsons
Channel to continue increasing the visibility of FOX. News Corp. is actively encouraging
the worldwide Direct Satellite Broadcasting (DSB) market.
General Electric holds NBC as a part of its diversification strategy. The financial
strength of General Electric increases NBCs competitiveness. The executives created
cable channels such as CNBC and MSNBC to compete with CNN. One of their unique
strategic alliance is designed to integrate the television medium with the information
superhighway, the Internet. The companys weekend programming is filled with sports
shows like NFL, Major League Baseball and the most popular National Basketball
Association. Its ability to continually market new situation comedies around the success of
a few mainstays is one example of its competitiveness. That is the reason why they are
entitled as the top-rated network in the television marketplace.
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Viacom is a vertically integrated producer, distributor, and multimedia operator.

Paramount Pictures is the largest holdings of Viacom. Its major asset is the Paramount
movie library, aside from movies paramount also has a television studio which is the
Paramount TV library. Viacom franchises includes; MTV a popular music video channel;
Nickelodeon, a channel geared towards children; and VH-1, a music video channel geared
toward an older audience than that of MTV. The company also has a large publishing arm,
The Simon & Schuster the worlds largest English-Language, educational, and computer
book publisher. Viacom acquired Blockbuster Entertainment, in year 1994, a large retail
outlet for movie videocassettes and music products.
NBC is a top-rated network in the television marketplace, its ability to continually
market new situation comedies around the success of a few mainstays is one example of
its competitivenes. The financial strength of General Electric increase the NBCs
competitiveness. NBCs weekend programming is filed with sports how, such as the NFL,
Major League Basketball Association, which has a loyal viewers. To compete with CNNtype viewer, the executives of NBC have created cable channels such as CNBC and
MSNBC. MSNBC is unique in that it is a joint venture with software power Microsoft. This
strategic alliance is designed to integrate the television mediun with the information
superhighway, the internet.
D. Internal Analysis
PORTERS VALUE CHAIN
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Value Chain Analysis

Primary Activities:
Inbound Logistics:
Actors/Actresses, Film Makers, Directors, Story board
Operations:
Shooting show/programs/series/movies
Operation of Disneys theme parks and resorts
Outbound Logistics:
Movies, series, animated films, programs, Cable televisions
Marketing and Sales:

Due to the popularity of Disneys animated cartoons, they start selling of
products such as stuffed toys and others.
Services:
Walt Disney offers entertainment not only through television, (e.g. Movies,
series, cartoons, etc.) but also on their established theme parks and resorts.
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Support Activities:
Firm Infrastructure:
TV Studio, TV Networks, Cable Networks, Radio
Human Resource Management:
Educating and developing people
Excellent interactive media developers
Technology Development:
Digital shooting/broadcasting
Phone services
Procurement:
Digital cameras, Computers, Video Editors
Sound recording systems
Consolidated Statement of Income (in millions, except per share data)
YEAR ENDED September 30
1996
1995
1994
Revenues
$18,739
$12,151
$10,090
Cost and expenses
-15,406
-9,685
-8,118
Accounting changes
Operating Income
-300
$3,033
$2,466
$1,972
-309
-239
-279
Corporate activities and other

Interest expense
Investment and Interest income
Acquisition related costs
Income before income taxes
Income taxes
Net Income
Earnings per share
-479
-178
-120
41
68
130
-225
$2,061
$2,117
$1,703
-847
-737
-593
$1,214
$1,380
$1,110
$2
$3
$2
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Source: Walt Disney Co. Annual Report, 1996
PRESENT INCOME STATEMENT
Page | 22
III- SWOT ANALYSIS
Page | 23
STRENGTHS
One of
its
obviously,
is
WEAKNESSES
strength,
Another weakness is the
major
Popularity.
Walt
length of the target
Disney Co. has branded itself
audience, Walt Disney
Worldwide as one of the most
Companys main target from
entertaining company and its
the very beginning is the
theme parks known as one of
children because of the
the most entertaining places in
industry that they have been
the world.
engaged into which is
The
Walt
Disney
producing animated films for
Companys
asset is also one of their major
kids. They should think of
strength.
something that will also get
They
own
multiple
channels (i.e., ESPN, ABC, A&E
the attention of the other
and
age generation aside from
Lifetime),
amusement
making theme parks to
parks, and stores.
maintain their dominance in
the market.
The Walt Disney Company also

has
diverse
products
and
There is a high risk factor in
collectible
the Walt Disney Companys
items like clothes, plates and
investments, because they
toys that are inspired by Disney
do not know if their products
movies
are going to be a hit. For
services.
It
that
sells
help
them
to
promote its product line and
example, their movies have
make more profit out of one
a reoccurring theme, which
business. Walt Disney Company
can be attractive or
Page | 24
also provides services such as

cruises,
movies,
unattractive to consumers.
and
amusement park rides that are

aligned to recreational.
Because Eisner has been a

hand on CEO of Walt Disney
Company, He always
intervenes in some job
has standards of quality that its
positions that results to
branches have to meet.
unclear leadership in the
This
makes the experience the same
company.
in all of their theme parks.
Eisner having his connections

gives Walt Disney Company the
chances
of
having
the
best
professionals to become a part

of the company and build a
strong top management.
Disney is the dominant/powerful

competitor in the theme park
industry.
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OPPORTUNITIES
Theme
parks
allow
media
THREATS
The Walt Disney Company has
competitors that are threats to
companies an opportunity to
the companys success.
promote
their
brand
image
Companies like Universal
through life experiences, such

Studios compete with the Walt
as meeting Mickey Mouse at
Disney Company in the
Disney World. This gives them a
entertainment industry.
more
popular
method
of
Universal Studios also makes
attaining brand recognition.

movies that appeal to children.
Since Walt Disney Company has
The merging of their
been in the industry of making

competitors like Six Flags that
films,
recreational
that
is
had an alliance with Warner
marketed
to
parents
and
Bros. to provide Loony Tunes
children (for the whole family)

characters to compete with
the company can used this to
Mickey Mouse of Walt Disney.
open
new
opportunities
and
explore to new industries that is
The continuous acquisition
aligned to their business since
strategy of Time Warner to
they
the
compete with the product line
popularity and a stable market
that the Walt Disney Company
position.
has.
already
have
The Walt Disney Company could

grow
further
through
diversification. They can make

more
cruise
ships
On how Walt Disney Company

can maintain is competitive
advantage over its competitors.
and
Page | 26
amusement
parks
in
other
The challenge on maintaining
major cities in the world. For
the production of quality film
example,
product that will be a hit to their
it
amusement
can
park
open
in
an
Dubai,
viewers.
because it is a rapidly growing

city, in the past ten years it has
become a world-renowned city.
Technology advances has been

the trend for years now and
with the new inventions using
this
technology
children
and
nowadays
internet
usually
spend their whole day using

their tablets and computers to
surf the net. With this Walt
Disney Company could make
websites that introduces new
Disney characters and dominate
the online world that will lead to
widen the market that they
have.

has the opportunity to expand
to
more
industries,
because
consumers will want to buy its
Page | 27
products
because
of
its
popularity around the world.
IV. Strategic Formulation

I. Strategy Alternatives
1. Establish a proper bureaucratic system inside the company.
2. Create a successor Plan
3. Give up the ownership of ABC
4. Continue and improve the process that they have.
5. Continue and reinvent its affiliates
II. Alternative Evaluation
1. Establishing a proper bureaucratic system in the company is having a sound and
clear leadership among the organization. Bureaucratic system helps organization
to implement and manage the organization based on what they perceived about
the future they desired. This is a set of rules that totally holds on how
organization should be managed, a guide that organization needs to achieve one
goal. As we evaluated this case study, we think that Disney needs to have this
whole new bureaucratic system that clears the problems arising in their
organization. Problems like the unclear leadership that happens in the part of the
ABCs management and the like.
2. Having successor in a company is something that every organization has to work
on. Succession planning helps companies to prepare for the future uncertainty.
This assures them the continuous success that the former has achieved. In the
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case of Disney, we think that this succession planning helps them to secure the
companys position in the world of business.
3. On the part of the ownership of Disney in ABC, we think that Disney should give
up and sell ABC to avoid them from having another burden in the future since
ABC was having a hard time on how to have its position in market back because
of the problems on the broadcasting policy.
4. Disney has grown well over the years that time and we have no doubt that they
already have the popularity that every business wants to have. So we think that
theres nothing wrong with the system that they have. They just have to
continue and improve it to maintain this stand over their competitors.
5. Disney has gone far in the entertainment business. They have that certain
pedestal that every company dreamt. Having this broad length of business like
theme parks, hotel and resorts, films and other business related, had made them
this stable market position. We think that they should continue to pursue the
business that they have and reinvent them at the same time as for the trends of
innovation in the modern days.
III. Alternative Choice
Based on the strategic alternatives that are listed above, we conclude that
despite Disney has this strong competitive advantage over the others, they also have
the same struggle that other companies were experiencing. Upon checking up and
analyzing the problems of Disney we come up with the strategic alternatives that
somehow answer Disneys problem. One of these alternatives was to create a
successor plan. This alternatives has somehow gives them a sense of security in terms
of immediate disposition of their company leader. Also having a successor means
having someone who will continue the success that the former has achieved. Another
alternative that we think might help Disney was to give up the ownership of ABC, since
we see ABC can be a burden to Disney in the future because of its low revenue. On the
Page | 29
other hand, we see Disney as a successful company but also struggled to maintain it.
We think that Disney should continue and reinvent its affiliates. Continue to broaden
their business by means of expanding their theme parks to different countries in the
world and reinvent the way they run their line of business. But with all the above
alternatives said, we think that those that have been said cannot really answer or
justify the real problem that Disney has.
And so we come up to two alternatives that might be the real answer to Disneys
problem and these are the establishment of proper bureaucratic system inside the
company and the other one is to continue and improve the process that they have.
Disney should have the bureaucratic system that will settle the confusion that arises in
the organization which we believe will reduce the sudden declination of the
performance of ABC. Also, having a clear bureaucratic system gives them a sound and
harmonious organization that actually clears out the goals and objectives that Disney
desired. Another alternative they should continue to improve their business for them to
stay on their market position.
IV. Strategic Alternative Implementation

With all the data gathered and analyzed, our group devised a strategic ideas which we
conclude would aide the crisis the walt disney company faced.
Walt Disney must establish a proper bureaucratic system inside their organization to
minimize conflict as well as confusion inside the company. Hence, Michael Eisner must
remove first his number twos delegation of work on its several worker which our group found
to be the cause of the low performance of ABC. The aforementioned is the one which has the
subjugation of work of Disney-ABC function. In establishing a proper bureaucratic system,
first, there has to be an assessment of the company's major priorities which will then be
Page | 30
provided with a special function in the company to work on. Then, prior to the creation of the
function, there must also be a clear description of the job assignment which will set
restriction and boundary that will limit their power each job position and let them focused on
achieving the main goal of the company. Furthermore, as the chairman of Walt Disney
Company, Michael Eisner must practice trust among his subordinates in making decision and
minimize his full hands-on approach in the company. Also, Instead of his full control approach
in the company in achieving their main goal, he must practice influencing his subordinates to
act and work like what the former founder did so that they would all work accordingly as one.
With regards to Walt Disneys crisis about the subsequent losses of ABC rating, we
believe that Walt Disney should just continue the operation of ABC, henceforth, they should
apply continuous process improvement in their affiliate channel. And to improve ABC, they
should do some minor to major changes with their channels such as improvement of logo,
entry of new segments that will catch the eyes of their target audience and bring out
something new in the market.
REFERENCES:
http://www.achievement.org/autodoc/page/eis0bio-1
http://www.nytimes.com/1995/08/01/business/the-media-business-the-impactsuddenly-at-abc-the-future-is-now.html
Page | 31
http://www.nytimes.com/1996/04/24/business/company-reports-disney-loses-25million-as-creative-division-falters.html
http://www.nytimes.com/1996/03/30/business/stock-and-bond-issues-surge-duringquarter.html
http://www.nytimes.com/1996/05/22/business/media-business-advertising-networkstry-sell-advertisers-after-bad-ratings.html
http://www.nytimes.com/1995/09/23/us/turner-to-merge-into-time-warner-a-7.5-billiondeal.html?pagewanted=all
http://www.nytimes.com/1993/09/12/us/viacom-to-announce-deal-to-acquireparamount.html
http://www.nytimes.com/1995/08/02/business/cbs-accepts-bid-by-westinghouse-5.4billion-deal.html
http://query.nytimes.com/search/sitesearch/?
action=click&contentCollection&region=TopBar&WT.nav=searchWidget&module=Sear
chSubmit&pgtype=Homepage#/Michael+Eisner+Left+Paramount/since1851/allresults/
2/allauthors/oldest/
https://books.google.com.ph/books?
id=4CCQAgAAQBAJ&pg=PA20&lpg=PA20&dq=walt+disney+telecommunications+199
6&source=bl&ots=CzcRWQpf2I&sig=g9EdOnnNsEFuTx5XQSSsKQ0Ugc&hl=en&sa=X&ved=0ahUKEwjHkZb7x9_OAhVEkZQKHYToBB4Q6AEIL
zAE#v=onepage&q=walt%20disney%20telecommunications%201996&f=false
https://www.ukessays.com/essays/marketing/a-case-study-of-the-walt-disney-companymarketing-essay.php
https://www.scribd.com/doc/24658023/Walt-Disney-Case-Study-Analysis
Page | 32

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Republic of the Philippines

Polytechnic University of the Philippines

Step 6 : doing the action

Step 1: Gaining Familiarity

Walt Disney | CASE STUDY

diversified multinational massmedia and

Walt Disney | CASE STUDY

Walt Disney | CASE STUDY

Step 2: Recognizing Symptoms

Walt Disney | CASE STUDY

Step 3: Identifying Goals

MICHAEL EISNERS GOALS

Walt Disney | CASE STUDY

Other Firms Goals

Step 4: Conducting Analysis

Walt Disney | CASE STUDY

Walt Disney | CASE STUDY

Walt Disney | CASE STUDY

Step 5: Making the Diagnosis

Walt Disney | CASE STUDY

Step 6: Doing the Action Planning

Walt Disney | CASE STUDY

General Outline for an Oral or a Written Presentation

I-STRATEGIC PROFILE AND CASE ANALYSIS PURPOSE

Walt Disney | CASE STUDY

Walt Disney | CASE STUDY

II- Situation Analysis

Walt Disney | CASE STUDY

Walt Disney | CASE STUDY

Walt Disney | CASE STUDY

in extremely large investments.

C. Competitive Environmental analysis

Walt Disney | CASE STUDY

through three interlocking fundamentals: creativity, libraries, and branded content

Walt Disney | CASE STUDY

Viacom is a vertically integrated producer, distributor, and multimedia operator.

Walt Disney | CASE STUDY

Value Chain Analysis

Marketing and Sales:

Walt Disney | CASE STUDY

Consolidated Statement of Income (in millions, except per share data)

YEAR ENDED September 30

Cost and expenses

Corporate activities and other

Walt Disney | CASE STUDY

Source: Walt Disney Co. Annual Report, 1996

PRESENT INCOME STATEMENT

Walt Disney | CASE STUDY

III- SWOT ANALYSIS

Walt Disney | CASE STUDY

length of the target

Disney Co. has branded itself

audience, Walt Disney

Worldwide as one of the most

Companys main target from

entertaining company and its

the very beginning is the

theme parks known as one of

children because of the

the most entertaining places in

industry that they have been

engaged into which is

producing animated films for

asset is also one of their major