Strategy and Culture of the Walt Disney Company

Background

For more than eight decades, the name Walt Disney has been paramount in the industry of family entertainment. From humble beginnings as a cartoon studio in the 1920s to today's global corporation, The Walt Disney Company continues to proudly provide quality entertainment for every member of the family, across America and around the world. Originally known as the Disney Brothers Cartoon Studio, with Walt Disney and his brother Roy as equal partners, the company soon changed its name, to the Walt Disney Studio, at Roy's suggestion.

Young arrived in California in the summer of 1923 with dreams and determination. He had made a short film in Kansas City about a little girl in a cartoon world, called Alice's Wonderland, and he planned to use it as his "pilot" film to sell a series of these Alice Comedies to a distributor. On October 16, 1923, a New York distributor, M. J. Winkler, contracted to release the Alice Comedies, and this date became the formal beginning of The Walt Disney Company.

Section 1: External Environment

(a) The examples of factors that have affected the way it has behaved are as follows.

Social: The Walt Disney Company fostered the spirit of creativity, innovation and excellence that continues to underlie all of the company's success. It believes that quality entertainment is for all members of the family across America and around the world. It gives a chance for the whole family to sit together and have a good time.

Technological: Silent cartoons were produced in as early as 1927. He introduced the first film with synchronized sound in The Jazz Singer. This was a huge success and later implied on Mickey Mouse, Silly Symphonies, Steamboat Willie, etc. Mickey Mouse became an immediate sensation instantly. In partnership with Pixar Animation, the company released the first computer-animated feature film, Toy Story. This was followed by a series of highly successful Disney/Pixar collaborations, A Bug's life, Toy Story 2, Monsters, Inc., Finding Nemo and The Incredibles.

Economic: These movies were released in the theaters and people enjoyed watching them with their kids at a normal rate. These movies were not charged any differently than the Hollywood Classics.

Political: During the war, Walt Disney made two films about South America, Saludos Amigos and The Three Caballeros, at the request of the State Department. The studio also concentrated on producing propaganda and training films for the military. When the war ended, it was difficult for the Disney Studio to regain its pre-war footing. With the advent of World War II, the company lost access to most of its foreign markets. The studio was also at some financial risk.

Legal Factors: Within a year of its existence, Walt made 26 Oswald cartoons, but when he tried to get some additional money from Winkler for a second year of the cartoons, he found out that the distributor had gone behind his back and signed up almost all of his animators, hoping to make the Oswald cartoons in his own studio for less money without Walt. Since the distributor owned the rights to Oswald, there was nothing Walt could do. It was a painful lesson for the young cartoon producer. From then on, he learned that he owned everything he made. Later Walt with his chief animator Ub Iwerks, designed a mouse whom his wife named Mickey, and a star was born.

(b) The relationship between the Walt Disney Company and the environment according to SWOT analysis is as follows:

The Walt Disney Company's Strengths

1. The Walt Disney Company is the second largest media and Entertainment Corporation in the world, after Time Warner, according to Forbes.

2. Diversified Entertainment Company.

3. It owns media networks as well as parks and resorts.

4. It makes movies and markets consumer products.

5. Developed a very strong and well known "brand-name and image" over many years.

6. Disney Land is the top rated destination for vacation.

The Walt Disney Company's Weaknesses

1. The idea of Disney's frequent change in top management.

2. Broader product portfolio gains many different niches and gives them a bigger image, but it also means that there are going to be that many more workers. This means greater possibilities for miscommunication and a high chance for a bureaucracy in the company. As of September 2010, there were 130, 000 people working for Disney in some way or another.

3. According to many, the Hong Kong Disney Land Resort has yet to live up to the expectations of Disney's resorts and parks. "The $1.8 billion theme park has only 16 attractions, only one of which is a classic Disney thrill ride (Space Mountain), compared to 52 at Disneyland Resort Paris. A recent study of Hong Kong Polytechnic University showed that 70% of the local residents had a negative opinion of Hong Kong Disneyland Resort.

The Walt Disney Company's Opportunities

The markets of today are becoming more versatile to outsourcing and globalization and The Walt Disney Company is revealing this by (i) expanding outside of the United States and offering theme parks in France, Japan and China. (ii) Another expansion opportunity from U.S. soil was mentioned earlier regarding the Disney Cruise Line, a service well placed and growing in popularity.

The Walt Disney Company's Threats

1. In Disney's case their theme parks must meet the safety regulations of the countries in which they operate in order to stay in business and maintain their international status.

2. In the entertainment and theme park industry there are many competitors, such as Paramount Parks, Universal Studios and Six Flags Theme Parks. However, there are many other less visible competitors that one might not naturally think of when assessing the competitive market in which Disney deals. For example, there are hundreds of water parks and various funplexes that can also be considered as cheaper or more valuable competition for Disney. Competition, in any form, can diminish Disney's market share in the entertainment industry.

(c ) Guidelines for SWOT ANALYSIS for Walt Disney

* Keep it simple

* Focus on your organization.

* Look for patterns.

* Look

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