walt disney strategy sss

7/28/2019 Walt Disney Strategy SSS

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Presenters:

•Rao P Satyanarayana•Dr. Sami

•Shahabuddin

ITM EEC Hyd Batch4

Date: 02/12/2012

StrategicManagement



Strategic Formulation

“I do not like to repeat successes, I like togo on to other things.”

Walt Disney

Satya – Sami – Shahbuddin ITM EEC Hyd Batch4



Overview

Company Overview•The Founder •Walt Disney’s Division•Mission statement•Financial Trends•Balance Sheet

Strategic formulation: Input stage•EFE•IFE•CPM

Stage 2: Matching stage•SWOT Analysis•Space Matrix•Grand Strategy Matrix•BCG

Stage 3: QSPM

•QSPM

Evaluation

•Strategies•Recommendations•Objectives for WaltDisney




The founder

• Walt Disney was born on December 5, 1901 in Chicago• During the fall of 1918, Walt Disney attempted to enlist for

military service but he got rejected.• He started a small company called Laugh-O-Grams, which

eventually fell bankrupt.• With his suitcase, and $20 Walt headed to Hollywood to start

anew.

• After making a success of his "Alice Comedies," Walt became arecognized Hollywood figure.

• Disney took a deep interest in the establishment of CaliforniaInstitute of the Arts, a college-level professional school of all thecreative and performing arts.

• Walt Disney passed away on December 15, 1966.

Walt, after the Studio

had won 4 Academy

AwardsWalt Disney 1901-1966




Media Networks Park and Resorts

• ESPN• Disney/ABC Television

Group• ABC Entertainment Group• ABC News• ABC Owned Television

Stations Group• ABC Family• Disney Channels

Worldwide• Hyperion Book s

• Disney Land Resorts• Walt Disney World Resort• Tokyo Disney Resort• Disneyland Paris• Hong Kong Disneyland• Disney Cruise Line• Disney Vacation Club• Adventures by Disney• Walt Disney Imagineering

Walt Disney Divisions




The Walt-Disney Studios Disney Consumer Products

• Walt-Disney StudiosMotion Pictures

• Marvel Studios• Touchstone Pictures• Disneynature

• Walt Disney AnimationStudios

• Pixar Animation Studios• Disney Music Groups• Disney Theatrical Group

• Disney Licensing• Disney Publishing

Worldwide• Disney Store

Disney Interactive Media

Group

• Disney Online• Disney Games

Walt Disney Divisions Cont.




"The mission of The Walt Disney Company is

to be one of the world's leading producersand providers of entertainment andinformation. Using our portfolio of brands todifferentiate our content, services andconsumer products, we seek to develop themost creative, innovative and profitableentertainment experiences and related

products in the world."

Mission Statement




Financial Trends

Avg P/E

Price/

Sales

Price/

Book

Net Profit

Margin (%)

BookValue/

Share

Debt/

Equity

Return on

Equity (%)

Return on

Assets (%)

Interest

Coverage

01-Oct-09 12.9 1.41 1.47 9.1 $18.55 0.38 9.8 5.2 9.6

01-Sep-08 14.2 1.69 1.85 11.7 $17.73 0.46 13.7 7.1 10.4

01-Sep-07 15 2.03 2.19 13.2 $15.67 0.5 15.2 7.7 10.4

01-Sep-06 16.9 1.87 1.98 9.8 $15.42 0.43 10.4 5.5 7.5

01-Oct-05 22.2 1.58 1.82 7.8 $13.06 0.49 9.4 4.6 6.3

01-Sep-04 21 1.52 1.7 7.6 $13.05 0.53 9 4.4 5.9

01-Sep-03 28.4 1.52 1.68 4.9 $11.82 0.57 5.6 2.7 3.4

01-Sep-02 33.4 1.2 1.29 4.9 $11.61 0.62 5.3 2.5 3




Balance Sheet




Framework

Satya – Sami – Shahabuddin ITM EEC Hyd Batch4



EFE




IFE




Critical Success factors Weights Rating Weighted Score Rating Weighted Score Rating Weighted Score

0.0 to 1.0 1 to 4 1 to 4 1 to 4

0 0 0

Advertising 0.12 4 0.48 4 0.48 2 0.24

Market Share 0.11 3 0.33 4 0.44 2 0.22

Company Image 0.12 4 0.48 3 0.36 3 0.36

Financial Position 0.11 4 0.44 4 0.44 3 0.33

Management 0.09 3 0.27 3 0.27 3 0.27

Global Expansion 0.12 4 0.48 4 0.48 4 0.48

Consumer Loyalty 0.12 4 0.48 4 0.48 3 0.36

Production Capacity 0.12 3 0.36 3 0.36 2 0.24

Technology 0.09 3 0.27 4 0.36 3 0.27

Totals 1 3.59 3.67 2.77

CPMMedia Network Segment




Framework




One of the most recognizable entertainment company in theworld

Strong advertising

Wide and unique portfolio

Innovative entertainment business

Strong customer service

Strong Media Networks and Broadcasting division

Disney owns a variety of companies, which allows them togenerate more profits from different industry such as MediaNetworks and Broadcasting, Park and Resorts, StudioEntertainment and Disney Consumer Products

Disney is the largest worldwide licensor of character-based

merchandise and producer of children’s film-related productsbased on retail sales

Strengths




Studio Entertainment and Disney Consumer Products divisions

have been experiencing declining revenue for the last 3 years

Disney as a narrow target market

Disney as such a diversify product range that it can reduce

efficiency and lead to a lack of strategic focus

High cost of entertainment production

High employee turnover

Poor working conditions in factories

Walt Disney’s Park and Resorts are not easily accessible which

leads people to associate Disney World with a costly trip

Weaknesses




Opportunity to renovate attractions in Park and Resorts Division

due to increase in profit

Growth from cable and satellite operators creating even more

potential for Disney to make money with their network

Prospect to build more theme park and resorts worldwide

Openings in other areas of the travel business

Opportunity to invest in building theme parks to satisfy the

increase in guest spending, theme park attendance, and hotel

occupancy

Target new costumers group

Opportunities




Lasting economic recession leading to slow growth rate

High unemployment rate

Park and Resorts Divisions’ success is unpredictable because ofexchange rate fluctuations; travel industry trends; amount of

available leisure time; oil and transportation prices; andweather patterns and seasonality.

Changes in technology leads customers to stream onlineinstead of buying DVD.

Online streaming makes Disney vulnerable to piracy andviolation of its intellectual property.

Retail distribution business are influenced by seasonal consumer purchasing behavior and by the timing and performance ofanimated theatrical release

Increase in labor cost which will have a noticed impact in Walt-Disney expenses due to their large amount of employee.

Threats




SWOT Matrix




Space Matrix Results




Space MatrixStrategies:Market DevelopmentMarket Penetration

Product DevelopmentForward IntegrationBackward IntegrationHorizontal IntegrationRelated DiversificationUnrelated Diversification




BCG




Strategies:

Market Development

Market Penetration

Product Development

Forward Integration

Backward Integration

Horizontal IntegrationRelated Diversification

Unrelated Diversification

Grand Strategy Matrix




QSPM MatrixStage 3:

Framework




QSPM Matrix




QSPM Cont.




Proposed strategies

“Disneyland will never be completed. It willcontinue to grow as long as there is imaginationleft in the world.”

Walt Disney

“Pixar is the most technically advanced creativecompany; Apple is the most creatively advancedtechnical company. “

Steve Jobs 2005-02-21




Use product development to renovate and

build new attractions in order to attract an

older target market.

Use market development to build a new

theme park which will be more accessible to

the North East area.

Strategies




Build an indoor theme Park and Resort in New

York.

Improve advertising to promote

entertainment which target a more mature

audience.

Remove the Interactive Media Segment.

Remodel and build new attractions in every

Park and Resorts to stay appealing to our customers.

Recommendations

In the next three years Walt Disney should..




Objectives

In the next year Walt Disney should…

Improve advertising to promoteentertainment

Remove the Interactive Media Segment

Buy a land in New York City




Questions


walt disney strategy sss

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