A Case Study on Walt Disney Company:

The Entertainment King

Section II Group III

FT152004 Apurv Mishra FT152072 Shivam Arora
FT152010 Deblina Majumder FT152086 Divyabala N
FT152027 Paul Gladstone FT152091 Katta P Siddhartha
FT152052 Prabin Mishra
Walt Disney (1923 -1967)
Roy Disney(1967- 1984)
Michael Eisner(1984- 2005)
Overview
Walt Disney was founded in 1923 by Walter Elias Disney along with
elder brother Roy
Walt was the creative one and Roy managed the finances
Three brief periods in Walt Disney under the leadership of
1.) Walt Disney (1923 -1967)
2.) Roy Disney (1967 - 1984)
3.) Michael Eisner (since 1984)
Major segments of the business
1.) Studio entertainment
2.) Media Networks
3.) Theme Parks and Resorts
4.) Consumer products
5.) Internet and Direct marketing
 Diversification

Vertical
Horizontal
Geographic
Product
Strategies in Eisners Period
Revitalizing TV and movies
Maximising Theme Park Profitability
Co-ordination among businesses
Expanding into new businesses , regions
and audiences
Critical Evaluation Of Eisner Strategy

Indiscriminate expansion
Inability to focus on their CORE competencies
(possibility of divesting in non-CORE)
Inorganic growth
Change management ABC culture clash.
Current Challenges for Eisner
Managing
Synergies managing conflicts between divisions,
diversifying into global markets, entering into new
types of entertainment
Brand dilution, protests from ethnic groups and
growing competition
Creativity traditional methods within groups,
effectiveness of gong groups
Culture Combativeness between creative and
strategic groups.
Financial Analysis
Disney ROA has declined from 12&% in 1987 to
2% in 2000
Hence, Total assets: 45.7B
Debt/Equity : 0.43
Operating margin declined from 25% to 13%.
Post merger the D/A increased from 20%to 34%.
ROE: slumped down from 26% to 4%
The total S/E for Disney= $23000M

The merger led to the stock rise from $20 to $116.

Questions & Answers
Invite questions from the audience