Capstone Paper

Final Capstone Paper: A Comprehensive Analysis and Recommendations for The Walt Disney Company’s Current Strategic Management Your Name Subject and Section Professor’s Name Date Executive Summary Strategic planning and management of the Walt Disney Company involves the assessment of challenges and objectives, setting resource improvement and competitive advantage. Due to the company's complex hierarchical structure and high-level professional staff, including the efficient executive management team and the Board of Directors, the company's work is practical and harmless. The recent major restructuring into three synergistic groups is to support creativity and commercial goals and improve worldwide companies and streaming services. Established in 1923, when Walt Disney and his brother Roy O established it, the firm has grown into a global entertainment giant, with over 200,000 employees and market capital exceeding $150 billion. Examples of operation diversification include the possession of TV networks, movie studios, theme parks, and streaming services. It is business-oriented and provides entertainment and education services to people worldwide, but it is founded on sound corporate social responsibility policies. However, due to management issues, specifically bad leadership, autocratic management systems, and political vices, the companies' corporate governance and stock performance have been affected. Nonetheless, Disney has endured and grown progressively in the media realm. An analysis of Disney's Strengths, Weaknesses, Opportunities, and Threats (SWOT) identified that Disney enjoys high brand awareness, diverse intellectual property (IP) library, and effective use of technology. Nonetheless, the company has some threats, such as high employee training costs, poor financial management of streaming services, and wrong marketing strategies. The threats involve reaching out to new customers, adopting emerging technologies, and exploring new content material. As with most industries, threats associated with it are high levels of competition, uncertainty in the economic market, and high costs related to acquiring the rights to sporting events and online streaming services. The new challenges of Disney include the decline of ESPN from TV to digital and streaming service, high Sports rights fees, High cost of Streaming Service, falling stocks, and Declining Visitors to the Parks. Due to the enumerated challenges, Disney needs to implement the newest technologies, such as artificial intelligence (AI) and machine learning, to enhance services, including personal content suggestions and utilization. Advanced means of data analytics shall capture the viewers' choice, thus enhancing the delivery systems. The company should also aim to generate good films with the author's vision, capture the viewers' attention, and get into exclusive content affiliation with a particular sports-related organization to sell the subscription. Enhancing user interfaces, better-tailored content in the feed, and mandatory additional engagement measures, such as virtual meetings with creators and backstage content, are trends. Financial strategies should thus lower overhead costs by securing long-term contracts on sporting events rights and information technology expenses. Better revenues would also be crucial because of program separation and ad-supported access to content. Observing the number of subscribers, the subscribers' retention rates, and general customers' interaction and now and then the operators' revenue, customers' satisfaction degree, and competitors' strategies are likely to explain the merit of these strategies. Disney has all the chances to efficiently and adequately navigate in entertainment. By adapting these recommendations, Disney will maintain its market share growth, financial stability, and the position to sustain itself within the steadily increasing entertainment market. Section 1 Overview of Disney The History of Disney On October 16, 1923, Walt Disney and his brother Roy O. Disney began the Disney Brothers Cartoon Studio in Hollywood, California. Presently called the Walt Disney Company, it has grown into one of the largest media conglomerates with a workforce of over 200000 employees and a market capital of over $150 billion. First, starting its animated shorts and features, Disney used distribution with other major movie studios before establishing its distribution company, Buena Vista, in 1953. This allowed Disney to move alongside the opening of Disneyland in 1955, shifting to becoming a massive and diversified media company. Although it struggled to manage the challenges that occurred after Walt Disney died in 1966, such as the creative and financial downturn during the 1970s and early 1980s, Disney later rose and re-established under the management of Michael Eisner Frank Wells through which achieved a creative revival featuring animated movies such as The Little Mermaid, Beauty and the Beast, Aladdin, and the Lion King (History.com, 2022; Kunze, 2023). During the leadership of Robert Iger, Disney's power increased due to the purchase of Pixar, Marvel Entertainment, Lucasfilm, and 21st Century Fox, strengthening its position in the media business. Disney is already in a different economic paradigm as it ventures into the second century of its existence. The current issues affecting the entertainment industry are a challenge for Disney, especially concerning the streaming business and other issues affecting Hollywood crews. Thus, the company's future success is predicated on its capacity to nurture and value the communicators who have been so crucial to its story. Disney's rise from a company with only several animators to a giant entertainment company worldwide using the power of storytelling (History.com, 2022; Kunze, 2023). A Competitive Industry Walt Disney Company has evolved a vast empire since the 1920s, making it the largest conglomerate in today's mass media industry. It is renowned for its films and television (TV) productions, parks and resorts, and many other enterprises. The TV branch is ABC TV network, several owned-and-operated broadcasting stations, and various cable networks, including Freeform, Disney Channel, and ESPN. Walt Disney Studios, Disney Animation, and Pixar manage Disney's motion picture operations. At the same time, Marvel Entertainment and Lucasfilm are other units that contribute to the success of film and merchandise. Furthermore, the company has challenged itself in the traveling sector with Disney Cruise lines and owns many theme parks worldwide. In 2019, Disney again expanded its media empire by purchasing 21st Century Fox to expand its content offering through Hulu. Nonetheless, despite the current and future-scale threats, including the COVID-19 impact and competition from Comcast, Sony, Netflix, and Amazon, Disney has consistently adapted and progressed by fully embracing its brand associations, unique narrative techniques, and acquisitions. This diversified approach solidifies its place in the market and enables this company to stay relevant and protect itself in a swiftly evolving entertainment business (Segal, 2022). Mission, Vision, Values, and Purpose Walt Disney Company’s mission and vision are to deliver entertainment, education, and positive messages to people of all ages and cultures via high-quality content and services by using Disney's famous brands, great creative performers, new technologies, and creative ideas to become the leading entertainment company in the worldwide market. Besides, it has a noble calling of nurturing hope for children about corporate social responsibility (CSR). This is done through monetary support, collaborations with non-profit organizations, donations of assets, and allowance for staff members to volunteer, and it has a substantial net positivity in the international arena. Their charitable giving is aimed at areas that utilize Disney's unique skills and abilities to address community requirements. Moreover, it remains committed to enhancing hospital stays through the USD 100 million initiative and partnerships with over 100 organizations for children with illnesses. Disney also motivates young people through the Future Storytellers program, which gives them hope and offers them a chance to venture into media, entertainment technology, and hospitality. The organization Disney Conservation Fund was founded more than 25 years ago. It also carries on with Walt Disney's ideas about wildlife protection; during the years, more than USD 125 million was provided to protect around 1,000 species and 315 million acres of habitat. Thus, Disney stays focused on its vision and values, supported by various entertainment products and social responsibility that this company offers to people to influence the world positively (The Walt Disney Company, n. d. -a,b). Leadership Issues The Disney Corporation has struggled with leadership issues over the years, mainly when Chief Executive Officers include Michael Eisner and Bob Chapek. Michael Eisner, who was with the company from 1984 to 2005, was enthralled by an autocratic management style that presided over major corporate governance problems, most notably, the hiring and firing of Michael Ovitz as president for a price of USD 109.3 million severance payout. Eisner’s approach led to tension in the situation and the formation of a weakened board of directors for Disney, suggesting the importance of improved succession and corporate governance systems. Recently, another leader, Bob Chapek, faced political issues related to the COVID crisis, the introduction of cost reduction, and a hiring freeze policy that led to a sharp decline in the company's shares. He also made a lot of political decisions, including his handling of Florida's "Don't Say Gay" bill, and this tautened the relationship between the company and its employees as well as political astute. It is mainly due to such measures that Chapek was booted out of the company in November 2022 to be succeeded by Bob Iger, who was previously the CEO with a vision of creativity, technology, and inclusion (Liotopoulos, 2023; Osman, 2024; BBC News, 2022). New Competitions in the Industry Disney+ is part of the streaming business, which has more or less the same rivals in the IT business, such as YouTube, Facebook, and Apple, which will also enter the self-produced material market. The increased consumption rates on digital platforms have associated streaming services with being a central part of consumer entertainment. Disney+ has an extensive IP house, enlisting Disney, Pixar, Marvel, Lucasfilm, and Fox to stake its claim. While theatres, parks, or other forms of direct business have been hit particularly badly by the pandemic, Disney+ was able to bank on the trend of people staying at home and increase its subscribers from 28 million to 50 million in the shortest time. The availability of a rich collection of classics, a day punch lineup, and vital steps such as concentrating on family-oriented programs and entering foreign markets make the company more advantageous than Netflix. However, as the industry constantly evolves, new developments and changes must be made to Disney+ to sustain its position in the market and further expand that position​ (Chen et al., 2022). Section 2 Strategic Planning and Management Strategic planning and management ensure that firms are ready for challenges by predicting them and helping them set worthwhile objectives. In strategic planning, direction is provided to a company, and there is an opportunity for change. Strategic management comprises resource management, business initialization, environment analysis, and competitive advantage strategies. Strategic management also enhances tactical planning and the overall structure of the organization. In addition, the arrangement and structures of a company are defined by its strategic goals (George et al., 2019). Business individuals logically fashion their enterprise to facilitate the achievement of the planned aims or objectives. This section will identify the specific nature of the organizational structure and governance of The Walt Disney Company and discuss how these features influence the company's strategic management process. The Walt Disney Company’s Organizational Structure Overview of the Organizational Structure The Walt Disney Company works hierarchically and multifacetedly, typical for large corporations. The President and CEO head the pyramid and are responsible for the company's operations and management. Directly reporting to the CEO is a solid executive management team of different officers for different functions, such as diversity officer, marketing manager, legal, finance, and operations manager. It also allows for specialization in the company's operations, thus making the operations efficient and holding the organizations accountable. Thus, many executives with designated responsibilities familiarized themselves with the concept of a division of labor that helps Disney manage many diverse businesses (Cheng, 2023). Executive Leadership The executive team is mandated to run the most prominent media conglomerate and develop globally reputable and valuable brands. Their strategic plan involves a focus on originality and the creation of high-quality content, as well as on introducing new advanced technologies when entering new vernacular markets. Nonetheless, this system's organizational and managerial formation should never be changed because of its successes (The Walt Disney Company, n.d.-a,b). The corporate organizational structure of The Walt Disney Company can be described as multi-tiered, with the President or CEO at the apex of the organizational structure backed by a team of Vice Presidents. These leaders introduce experience, distinctive strategic outlook, and passion for quality, innovation, and creativity while effectively managing the affairs. The executive leadership and board of directors work to maintain Disney's legacy of innovation and success (The Walt Disney Company, n.d.-a). Board of Directors Disney has a Board of Directors comprising people from prominent global organizations and industries. Hence, there is variety in the type of knowledge, ideas, and experiences they bring to Disney. This diversity, therefore, assists in the company's direction and sustainable value creation. In this manner, the executive leadership and board of directors ensure that Disney's tradition of creativity and firm performance is preserved (The Walt Disney Company, n.d.-a). Governance Structure Disney’s corporate governance system includes a Board of Directors comprising representatives from diverse global organizations and markets. The broad board's stakeholders possess knowledge, perception, and experience crucial for directing the firm and creating sustainable value. The board of directors is also involved in managing the strategies and performance of the company’s operation, overseeing Disney's compliance with its mission and values in the global market. This governance structure helps to welcome the strategic planning section in the company as it includes various viewpoints crucial for balanced decision-making (Carillo et al., 2012). Impact on Strategic Planning and Administration Disney has a complex and multilayered organizational structure composed of different segments and subunits, which influences the company's strategic management and administration owing to the differentiated governance systems. The experienced executives provide focused management that guarantees optimal performance of each business segment within the corporate vision. At the same time, the board is equipped with a broad range of professional skills and guidance to navigate through specific strategic decisions while building the company's immune system for innovation. Thus, the described structure unites organizational synergies while making the necessary adjustments in the market and provides for the company's recognizable image and good performance. Combining these components guarantees Disney's strategic goals and constant market development, which permits the company to become a market leader (Cheng, 2023; Carillo et al., 2012). Disney's most recent strategic reorganization provides another example of how implementing an entity's structure affects strategic development and management. To achieve this, the organization has been reshaped into three integrated strategic business units: Disney Entertainment, ESPN, Parks, Experiences, and Products, to reestablish clear creative business responsibility and creativity reform. This restructuring benefits creative leaders best, as they get total control of their segments' operations and finances. This involves managing creative direction, advertising, media technology, sales, and merchandising to ensure company planning aligns with the creative and business objectives. This change aims to promote global business improvements and foster the company's streaming operation to generate steady and profitable revenues (The Walt Disney Company, 2023). The area presidents of each business line, like Alan Bergman and Dana Walden, overseeing Disney Entertainment, and Jimmy Pitaro, presiding over ESPN, guarantee that strategic initiatives are executed as planned. Thus, decentralizing control and increased accountability enable Disney to adapt to changing market needs and experiment with content distribution and client engagement. This approach renders a culture of creativity and strategic counterpart, which is essential for Disney Company to sustain its competitiveness and generate value in the long run. This is backed by the integration of shared-service org...