Why Has Disney Been So Successful for So Long?

1. Why has Disney been so successful for so long?

Disney has been successful for so long because of the foundation and strategy it was built on. Walt Disney used the strengths that he had and used other for the areas that he was personally weak in. He built a strategy that was based upon a vision and core key values. His vison was to grow the business and built a strategy and tactics to do so. He took chances and developed some of the most innovative systems for their time to elevate his customer’s experience and to dive into the blue water out of the red ocean.

Walt was okay with failure understood that failure was part of the journey to success. He was open to taking the risk in opening new untapped markets that were not seen as needed such as an animated movie with voice integration, live action movies, and a theme park for the entire family and not just for the kids.

His core principle is what set the Disney company apart. They were Provide a promise, not a product, always exceed customers’ expectations, pursue your passion and the money will follow, stay true to your mission and values, differentiate your offer, lead by example and delegate, defy convention, and leave behind something to grow. Walt Disney Land is not a product, but an experience. It was not the traditional theme park. He exceeded customers’ expectations by create a clean, family friendly atmosphere that did not have the negative carnie perception. Walt Disney knew what his passion was and did not let money get in the way of pursuing it. He set a culture that the money will come if you go for your passion. Disney maintained this mindset and culture through the years long after Walt had passed away, and they continue to stay with their basics today. The process and culture of Disney is unique. It is an organization that people want to be a part of more than just for money. As mentioned in the case, the management team goes through the training to understand more thoroughly so they can lead by example. Disney has gone against what other have said could not be accomplish or bad ventures. This includes the integrated voice and animation, new acquisitions of movie production companies that were marketed to different consumers, ventures in the hospitality industry and multiple theme parks. Disney’s largest differentiator is they always leave a project behind to grow. This was even true with Disney World. Disney World opened its gates almost 5 years and Walt Disney had passed away.

2. What did Michael Eisner do to rejuvenate Disney? Specifically, how did he increase net income in his first four years?

Eisner rejuvenated Disney by focusing on the shareholders. Eisner’s primary goal was to maximizing shareholder wealth through an annual revenue growth target and return on stockholder equity. He had high expectations the return exceeding over 20%. He had to build Disney’s brand while staying true to the companies values and principles. He made sure that the key values were integral in the process. He made it mandatory that all new employees whether entry level or executives went through a 3-day culture course that included the employing even dressing up as a character for a day.

Eisner used the strengths of the organization to establish a catapult for growth. He viewed “managing creativity” as Disney’s most distinctive corporate skill. He intentionally encouraged tension between divisions and open debates. He believed that the best idea would present itself if it was validated between all the employees after being put through a gauntlet.

While Eisner wanted to stay true to the company’s history, he understood that the market was changing and that new opportunities were not being captured by Disney. He allowed Disney to produce its first R-rated movie shortly after his arrival. It turned out to be a huge success. Although, not all of his new risqué ideas were accepted by his traditional consumer, he was able to establish new markets and audiences that gave the company over 20% return in his early years.

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