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Strategic Management Mr. Leopoldo Lopez February 5th 2012
• Maria Jose Hernandez-Fu • Montserrat Ruano • Mauricio Reyes • Fernanda Rodriguez
• Erubey Barron .
is a leading family entertainment and media enterprise with four business segments: media networks. retail stores.Mission and Vision Analysis Since its founding in 1923. studio entertainment and consumer products. we seek to develop the most creative. hotels. Mission Statement "The mission of The Walt Disney Company is to be one of the world's leading producers and providers of entertainment and information. The Walt Disney Company and its affiliated companies have remained faithful to their commitment to produce unparalleled entertainment experiences based on the rich legacy of quality creative content and exceptional storytelling. restaurants.¨ .theme parks. together with its subsidiaries and affiliates.Nonetheless havign a clear Vision Statements could positively impact them in reaching more accurate strategic planning for their future business endeavors. services and consumer products. We suggest Disney´s Vision statement to be the following: Suggested Vision Statement: ¨We at Disney envision to be the leading diversified international family entertainment and media enterprise. Their focus is based on delivering the highest quality products and services in all of their four strategic Business Units." The Disney Company has no particular Vision statement. Using our portfolio of brands to differentiate our content. parks and resorts.Disney Company (Company Analysis) I. The Walt Disney Company. innovative and profitable entertainment experiences and related products in the world. etc. One of the reasons why Disney has a reputation of delivering a seamless "magical" experience to its customers in all of its operations . .is because it has one overriding mission for all of its business operations.
In addition. Disney has focused on market diversification for years and the company covers a wide array of products and services. Disney´s key position in the market allows for them to continue diversifying and sets them apart from other entertainment companies. As a result. and the power and technological advancements of their Research and development team has enable them to continue being at the top of the Entertainment Industry. A key example of this type of competitor was Pixar. and the creation of international theme parks. company officials know to a large extent what the target customer wants. In the case of Disney an its main competitors DreamWorks has been trying to position itself as a different kind of entertainment company providing new forms of entertainment that appeal to more adult cutomers. Past New Entrants in the market as Pixar were bought by the entertainment Giant.Porter’s Five Forces Analysis – Disney Overview Michael Porter's Five Competitive Forces Model focuses on the external environment that companies are forced to study. Being a market leader has made it possible for the company to practice effective economies of scale in production. By relying on past experience. identification. Rivalry among competing Firms Rivalry among competitors is moderate in the case of Disney Company. the entrance barriers in the entertainment industry are relatively high. ´ Potential Development of New Competitors. Since the Disney Company has been able to find a very distinctive niche in the industry.Nevertheless. Nonetheless competition is fierce among the small number of competitors. The first force to be discussed is the threat of new entrants. in order to construct sound recommendations to foster potential growth. In the following analysis we will explore Porter´s Five Forces and we will apply them to one of the Largest Corporations in the World. Disney continues to be ahead in the market by diversifying their operations and appealing to other markets through the acquisition of Sport-chain channels. The capital requirements are extremely high. especially in the Media Networks and Broadcasting Strategic Business Unit. and convert threats into opportunities. as a result they acquired a percentage of Pixar and today under the name Disney Pixar they have produced some of the most successful animated movies ever created. and cope with in order to be successful. We will address the external factors that influence the Disney Company. Disney will try to absorb it. The Disney Company. Disney dominates the family entertainment market. understand. It would be very hard for new market entrants to try and compete with Disney. and product differentiation. The company has been able to grow steadily in the last 20 years.II. extremely large amounts of capital investment are required for new entrants into the industry. It is important to note that Disney´s power in the industry is so great that when a key competitor has entered the market. making it very difficult for new organizations to develop brand recognition. Disney new that Pixar’s technological advances in animation posed a serious threat to them. The entertainment Industry has high entrance barriers that limit the competition in this realm. For .
and Media Networks Broadcasting. although more moderate. Disney´s suppliers are dominated by a few numbers of companies. Disney is clearly dependent on satisfying their customers in order to succeed in their four business units: Consumer Products. the customers have certain powers. the size of the company may certainly be of great advantage. It is essential that Disney is able to retain the highly skilled and imaginative workers. However. the threat alone of new entrants into the market requires Disney to hedge against such risk by concurrently upgrading products and services. For instance.instance. Other cartoon figures. On the other hand. but recent studies have proven they do not represent a significant threat. and movies can penetrate the market in which Disney is operating. more highly skilled suppliers due pose a particular threat to the company. and successful. The Disney Company is operating in a highly differentiated and unique industry with high switching costs associated with operations. Disney spent USD3. Furthermore. Disney creates a dependency relationship in the industry. However. Disney is a unique and important customer for these particular suppliers.6 billion in its European theme park. Studio Entertainment. Only very large companies can meet such large capital requirements. The Bargaining Power of Customers The bargaining power of customers is relatively high in the service and in the entertainment industry. . It is the technological advances and changes in the Entertainment segment what keeps Disney fresh unique. if the price on a particular home video is too high. Parks and Resorts. We should remember that the entertainment industry is an industry based on consumption and emotional experiences. By being able to order large volumes of unique products from unique suppliers. The Bargaining Power of Suppliers The bargaining power of suppliers is also important. The Disney Company has already placed price ceilings on many of its product lines. This allows for lower supplier costs. shelter or clothing. such as food. customers may be reluctant to spending the money needed to purchase the product. theme parks. therefore its products are not a necessity for life. Disney could easily be affected. and should be able to compete with new competitors. Potential Entry of New Competitors The threat of substitute products or services is moderate to low. If prices or particular expectations by the customers are not met. Since a large number of customers are needed to make Disney's operations run smoothly.
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