Match Disney's Actions To Each Step Of The Process

The Walt Disney Company, a global entertainment giant, owes its century-long success to a meticulous and consistently evolving strategic management process. By examining Disney's actions through the lens of this process, we can gain valuable insights into how the company has maintained its competitive edge and adapted to an ever-changing market. This article will dissect Disney's strategic management, aligning its key initiatives with each step of the process: environmental scanning, strategy formulation, strategy implementation, and strategy evaluation.

Environmental Scanning: Reading the Tea Leaves of the Entertainment Industry

Environmental scanning is the crucial first step, involving gathering and analyzing information about the external and internal environments to identify opportunities and threats. Disney has historically excelled at this, consistently anticipating shifts in consumer preferences, technological advancements, and competitive landscapes.

• External Analysis: Disney meticulously monitors external factors:

  • Technological: Disney recognized the potential of streaming early on, leading to the launch of Disney+. This move was a direct response to the increasing popularity of online video consumption and the declining relevance of traditional cable television. They also embraced advancements in animation technology, consistently pushing the boundaries of visual storytelling.
  • Economic: Disney is acutely aware of global economic trends. During periods of economic recession, they have often emphasized value-oriented offerings, such as bundled theme park tickets or discounts on merchandise. Conversely, during economic booms, they have focused on premium experiences and luxury offerings.
  • Social: Disney is highly sensitive to evolving social values and cultural trends. The company has made significant efforts to diversify its characters and storylines to reflect a wider range of ethnicities, genders, and perspectives. This includes movies like Moana, Coco, and the live-action remake of The Little Mermaid. They also actively monitor social media to gauge public sentiment and address potential controversies proactively.
  • Political/Legal: Disney operates in a highly regulated environment and constantly monitors changes in laws and regulations related to media ownership, intellectual property, and international trade. Their acquisition of 21st Century Fox, for instance, required extensive regulatory approvals from various government agencies.
  • Competitive: Disney keeps a close eye on its competitors, including Netflix, Universal Studios, and Warner Bros. Discovery. They analyze their rivals' strategies, market share, and product offerings to identify opportunities for differentiation and competitive advantage. The launch of Disney+ was a direct competitive response to Netflix's dominance in the streaming market.

• Internal Analysis: Disney also conducts a thorough internal analysis to assess its strengths and weaknesses:

  • Resources: Disney boasts a vast portfolio of valuable resources, including iconic characters, a global brand reputation, theme parks, television networks, and a robust film production infrastructure. They constantly assess the value and utilization of these resources.
  • Capabilities: Disney has core competencies in storytelling, animation, theme park design and operation, and media distribution. They continuously invest in improving these capabilities through training, technology upgrades, and strategic acquisitions.
  • Organizational Structure: Disney has evolved its organizational structure over time to adapt to its growing size and complexity. The company is currently organized into several business segments, including Parks, Experiences and Products; Media and Entertainment Distribution; and Studios Content.
  • Culture: Disney has a strong corporate culture that emphasizes creativity, innovation, and customer service. This culture is fostered through employee training programs, recognition programs, and a commitment to creating a magical experience for guests.

By meticulously scanning both the external and internal environments, Disney gains valuable insights that inform its strategic decisions. This proactive approach allows them to anticipate changes, identify opportunities, and mitigate potential threats.

Strategy Formulation: Charting a Course for the Kingdom

Strategy formulation involves developing strategic options, evaluating those options, and selecting the best course of action to achieve the organization's mission and objectives. Disney's strategic decisions are guided by a long-term vision of becoming the world's premier entertainment company.

• Defining the Mission and Objectives: Disney's mission is to entertain, inform, and inspire people around the globe through the power of unparalleled storytelling, reflecting the iconic characters, creative minds and innovative technologies that make theirs the world's premier entertainment company. Their objectives include:

  • Growth: Expanding their global reach and increasing revenue across all business segments.
  • Profitability: Maintaining strong financial performance and generating consistent returns for shareholders.
  • Innovation: Continuously developing new and innovative products and services to enhance the customer experience.
  • Brand Equity: Strengthening the Disney brand and maintaining its reputation for quality and family-friendly entertainment.

• Generating Strategic Options: Based on its environmental scanning, Disney generates a range of strategic options, including:

  • Market Penetration: Increasing sales of existing products and services in existing markets. This includes strategies like promotional campaigns, loyalty programs, and expanded distribution channels.
  • Market Development: Expanding into new geographic markets or demographic segments. Disney has successfully expanded into international markets like China and India through strategic partnerships and localized content.
  • Product Development: Creating new products and services to meet evolving customer needs. This includes developing new animated films, launching new theme park attractions, and creating original content for Disney+.
  • Diversification: Entering new industries or markets that are unrelated to the company's existing business. Disney has diversified into areas like cruise lines, real estate development, and online education.

• Evaluating Strategic Options: Disney evaluates each strategic option based on its potential impact on the company's mission, objectives, and financial performance. They consider factors like market size, competitive intensity, resource requirements, and risk.

• Selecting the Best Strategy: Disney's overarching strategy can be described as a related diversification strategy, where they expand into new businesses that are related to their core entertainment business. This allows them to leverage their existing resources and capabilities while mitigating risk. Some key strategic decisions include:

  • Acquisition of Pixar: This acquisition strengthened Disney's animation capabilities and brought in a wealth of creative talent, leading to a string of blockbuster films like Toy Story, Finding Nemo, and The Incredibles.
  • Acquisition of Marvel Entertainment: This acquisition gave Disney access to a vast library of superhero characters, which has fueled the success of the Marvel Cinematic Universe (MCU).
  • Acquisition of Lucasfilm: This acquisition brought the Star Wars franchise under Disney's control, allowing them to create new films, television shows, and theme park attractions based on the iconic saga.
  • Launch of Disney+: This strategic move positioned Disney as a major player in the streaming market, challenging the dominance of Netflix and providing consumers with a vast library of Disney content.

By carefully evaluating its options and selecting the best course of action, Disney has consistently made strategic decisions that have propelled its growth and success.

Strategy Implementation: Bringing the Magic to Life

Strategy implementation involves putting the chosen strategy into action. This requires allocating resources, developing organizational structure, establishing policies, and motivating employees. Disney's success in implementation stems from its meticulous attention to detail and its commitment to creating a seamless and magical experience for its customers.

• Resource Allocation: Disney allocates resources strategically to support its key initiatives. This includes investments in:

  • Capital Expenditures: Building new theme park attractions, upgrading existing facilities, and acquiring new technologies.
  • Research and Development: Developing new animation techniques, creating innovative theme park experiences, and producing original content for Disney+.
  • Marketing and Advertising: Promoting Disney's products and services through various channels, including television, print, online, and social media.
  • Human Resources: Recruiting, training, and retaining talented employees who can contribute to the company's success.

• Organizational Structure: Disney's organizational structure is designed to support its strategic goals. The company is organized into several business segments, each with its own management team and responsibilities. This allows for greater focus and accountability.

• Policies and Procedures: Disney has established a comprehensive set of policies and procedures to ensure that its operations are conducted efficiently and ethically. These policies cover areas such as:

  • Quality Control: Ensuring that all products and services meet Disney's high standards.
  • Customer Service: Providing exceptional customer service to create a positive and memorable experience.
  • Safety: Maintaining a safe environment for employees and guests.
  • Ethics: Adhering to the highest ethical standards in all business dealings.

• Leadership and Motivation: Disney's leaders play a crucial role in motivating employees and driving the implementation of the company's strategy. They foster a culture of creativity, innovation, and customer service. This is achieved through:

  • Communication: Clearly communicating the company's vision, mission, and objectives to employees.
  • Empowerment: Empowering employees to make decisions and take ownership of their work.
  • Recognition: Recognizing and rewarding employees for their contributions.
  • Training and Development: Providing employees with the training and development opportunities they need to succeed.

Examples of Disney's successful strategy implementation include:

• The opening of Shanghai Disneyland: This was a complex project that required careful planning and execution. Disney successfully navigated the challenges of building a theme park in a new market, adapting its offerings to local tastes and preferences, and managing a large workforce.
• The integration of Marvel Entertainment: Disney successfully integrated Marvel's characters and storylines into its existing theme parks, television shows, and merchandise offerings. This has created new revenue streams and enhanced the Disney brand.
• The rollout of Disney+: Disney successfully launched its streaming service in multiple countries, attracting millions of subscribers and establishing itself as a major player in the streaming market.

Through meticulous planning, resource allocation, and a strong focus on execution, Disney has consistently demonstrated its ability to implement its strategies effectively.

Strategy Evaluation: Measuring the Magic and Adjusting the Course

Strategy evaluation involves measuring the performance of the organization against its objectives, identifying areas for improvement, and making necessary adjustments to the strategy. Disney continuously monitors its performance and adapts its strategies to changing market conditions.

• Performance Measurement: Disney uses a variety of metrics to measure its performance, including:

  • Financial Performance: Revenue, profit, earnings per share, and return on investment.
  • Market Share: The percentage of the market that Disney controls in each of its business segments.
  • Customer Satisfaction: Measuring customer satisfaction through surveys, feedback forms, and social media monitoring.
  • Employee Satisfaction: Measuring employee satisfaction through surveys and feedback sessions.
  • Brand Equity: Tracking the strength and value of the Disney brand.

• Benchmarking: Disney benchmarks its performance against its competitors and industry best practices to identify areas for improvement.

• Feedback and Analysis: Disney actively seeks feedback from customers, employees, and other stakeholders to identify areas where it can improve its products, services, and operations.

• Corrective Actions: Based on its performance evaluation, Disney takes corrective actions to address any shortcomings and improve its performance. This may involve:

  • Strategy Adjustments: Modifying the company's strategy to adapt to changing market conditions or to address unforeseen challenges. For example, Disney adapted its theatrical release strategy during the COVID-19 pandemic, releasing some films directly on Disney+.
  • Operational Improvements: Implementing changes to the company's operations to improve efficiency, reduce costs, or enhance customer service.
  • Resource Reallocation: Shifting resources from underperforming areas to areas with greater potential.
  • Organizational Restructuring: Modifying the company's organizational structure to improve coordination and communication.

Examples of Disney's strategy evaluation and corrective actions include:

• The re-imagining of Disney California Adventure: After initial struggles with attendance and guest satisfaction, Disney invested heavily in re-theming and adding new attractions to Disney California Adventure, transforming it into a popular destination.
• The decision to focus on streaming: Recognizing the growing importance of streaming, Disney made a strategic decision to prioritize Disney+ and other streaming services, shifting resources away from traditional cable television.
• The ongoing evolution of theme park experiences: Disney continuously updates its theme park attractions and experiences to keep them fresh and relevant, responding to guest feedback and incorporating new technologies.

By continuously evaluating its performance and making necessary adjustments, Disney ensures that its strategies remain aligned with its objectives and that it continues to deliver exceptional entertainment experiences to its customers.

Conclusion: The Enduring Magic of Strategic Management

Disney's century of success is a testament to the power of effective strategic management. By meticulously scanning the environment, formulating sound strategies, implementing those strategies effectively, and continuously evaluating its performance, Disney has consistently adapted to change, capitalized on opportunities, and overcome challenges. The company's commitment to innovation, creativity, and customer service, coupled with its robust strategic management process, has enabled it to maintain its position as the world's premier entertainment company. Disney's actions, meticulously aligned with each step of the strategic management process, provide a valuable blueprint for organizations seeking to achieve sustained success in today's dynamic business environment. The magic of Disney isn't just in its storytelling; it's in its strategic execution.