The Walt Disney Corporation: the Entertainment King

1230 Words Nov 11th, 2012 5 Pages
The Original Disney Company (pre-1984)

Walt Disney set a vision for the company – to provide wholesome family entertainment. Everything that the company did was aligned to this vision and corporate philosophy.

The key ingredient that fueled the success of Walt Disney Company was its ability to create new, unique cartoon characters that had universal appeal. Over the years, Disney did a great job in bringing these characters to life, and kept introducing new characters that further solidified Disney as a company that valued creativity. At that time, there was no other company that had as many successful cartoon characters as them. The company applied its creative strategy beyond characters and ventured into new business areas, such as
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Divisions were motivated to form synergies by offering increased bonus incentives. Disney also implemented internal transfer prices between divisions. In addition, the company vertically integrated many functions to limit costs and afford flexibility. These synergies fostered a culture of support and minimized costs from external suppliers. They further integrated the synergies by introducing the corporate marketing function to better align the entire company’s marketing activities.

Disney has been successful in capturing value from synergies. In Eisner’s estimation, the company had re-discovered the synergistic culture that had helped build the company.

The Later Eisner Years (Post 1993)

The Disney and ABC merger was an extremely important development in the strategic timeline of the company. It gave the company a completely new direction.

Sentiment at the time of the merger had not been positive towards such a merger. The track record of previous such mergers, some of them involving Disney’s competitors, had not been great. In the early years of the merger, they faced conflicts around corporate fit, conflicting management styles, and lack of a sound strategy.

It was an extension of the growth strategy put in place by Eisner, yet it exposed the company to risks related to synergy and brand effectiveness. While thus far they had been successful at vertical integration within their existing lines of
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