Bob Iger Rocks Disney, Jan 19, 2009 & Q&a-the Iger Difference
During a stagnant period in Disney’s storied history, CEO Bob Iger joined the company in 2000 as president and later became the CEO, succeeding Roy E.Disney. Iger vision to turn Disney’s quest to become a well-diversified mega media conglomerate was realized with strategy of related diversification with the goal of enhancing the company with major dividends. The Walt Disney Company started primarily in 1923 as a studio animation company. Over the past 80 years, Disney has grown to become a mega-entertainment empire, comprising four diversified business units: Studio Entertainment (Pixar and Disney Animation), Parks and Resorts (Disney World and a host of other theme parks), Consumer Products (Cars Franchise, Mickey Mouse and Winnie the Pooh), and Media Networks (ABC, ESPN, Disney Channel). These segments consist of integrated, well-connected businesses that operate in concert to maximize exposure and growth worldwide. The difference with Disney in respects in their core competencies in regards to related diversification is the majority of Disney’s revenue does not come from a single business unit, where the different businesses share only a few links and common attributes or different links and common attributes.
As with any company that wants to diversify, Disney’s strategy is driven by lofty financial goals. From our lesson, we know that any company who wants to diversify the company must aim to maximize earnings and cash flow, and allocate capital profitability toward growth initiatives that will drive long-term shareholder value. Disney has developed a strong brand image over many decades and generations while successfully diversifying its operations and products to hedge against decreasing revenues in product lines such as their Disney Animation Studio productions. Even within the consumer products business, Mickey Mouse and Winnie the Pooh accounted for more than 80% of their core business, now its roughly 50% of its sales due to the emergence of the
As with any company that wants to diversify, Disney’s strategy is driven by lofty financial goals. From our lesson, we know that any company who wants to diversify the company must aim to maximize earnings and cash flow, and allocate capital profitability toward growth initiatives that will drive long-term shareholder value. Disney has developed a strong brand image over many decades and generations while successfully diversifying its operations and products to hedge against decreasing revenues in product lines such as their Disney Animation Studio productions. Even within the consumer products business, Mickey Mouse and Winnie the Pooh accounted for more than 80% of their core business, now its roughly 50% of its sales due to the emergence of the