Corporate-level strategy
Disney’s corporate level strategy is anchored on Walt Disney’s corporate vision to “create universal timeless family entertainment”. The synergy and strategies applied by Disney has helped the firm’s market growth and expansion strategy.
Disney was informed of the importance of vertical integration and total control by “Oswald, the Lucky Rabbit”. As a result, “Oswald, the Lucky Rabbit” taught Disney the important lesson of total control and vertical integration.
“Disney established its own distribution house, film studio, music label and so on to better control quality content and costs. The effectiveness and efficiency of the communication and production department was made possible by the synergy developed by having similar corporate culture” (Smith 2003, p.15).
Acquisition strategy
Disney successfully acquired ABC which helped it increase market share and reduce competition as it increased its synergy.
Brand Image
Brand Image is an important corporate strategy that has helped to differentiate and promote the image of Disney among its competitions. To do this Disney has employed horizontal integration strategy to promote its products thus gaining a lot of customer interest and loyalty.
To do this Disney used a number of ways such as the Disney Broadway shows which were meant to improve its brand image and the use of parades to get the attention of clients. Disney also licensed its characters as a means of keeping them longer in client’s mind and as opposed to using it as a cash flow mechanism.
Geographical and horizontal expansion leading to synergies and leverage in capabilities and resources. Disney had to apply horizontal integration to increase it market niche and awareness. It was able to use cross-promotions to expand its market segment.
The company introduced more adult content that was more than the normal family content with animations, movies and theme parks and others that formed part of the market. Geographic expansion was a logical strategy applied by Disney where it ventured to markets in Tokyo, Japan.
Leadership and creativity
Disney had one executive whom it relied heavily to implement the creativity of the firm. “Walt Disney created the animated film then led his theme park vision to create a total entertainment for the whole family (Smith 2003, p. 56).
Business level strategy
Differentiation strategy
Disney has succeeded to differentiate its products in various ways by providing a range of products which include movies, consumer products, introduction of vacation resorts, development of TV and Radio, it has successfully developed theme parks and lastly it has publishing services.
This differentiation strategy has enable Disney command a huge market and it has been able to remain in the minds of customers for long. Clients are able to identify themselves with Disney due to its wide range of products.
Product level development
Disney has successfully invested in research development to come up with unique products to meet the ever increasing needs of its customers. To this end, Disney has successfully developed zoological parks for animals which are a major source of revenue, it has introduced food concessions and it has developed Water Park. These are key product developments that were added to Disney line of services.
Market development
Disney has not only served the local market but it has also ventured in international market. It has global markets such as in Tokyo Japan, Canada, India, Canada, Hong Kong, parts of Europe and china as well as other regions of the world.
Disney structure
“Since the company started in 1923, quality, creativity, entrepreneurship, and teamwork have been the core of Disney’s corporate values. Walt E. Disney himself was known for his commitment to excellence and hardworking management style” (Smith 2003). Before this, the structure was non-hierarchical with no one with a title.
This helped Disney to improve quality of work as it achieved synergy in the company. After the death of Disney in 1966, the company’s values started to fade away as the management of the film section had difficulties in coming up with creative ideas.
“In 1984, Eisner took over Disney as an outsider but he quickly instilled the same corporate values introduced by Walt Disney and simultaneously introduced frictions based on his promise of maximizing shareholder’s return of 20%” (Smith 2003).
The hierarchy of the company changed since Eisner recruited from outside people who would run the motion pictures section, he developed a strategic planning group and came up with marketing segment and this led Disney to have a hierarchical structure. Eisner put emphasis on financial performance and innovativeness. This led to conflict between the creative and financial group in the firm.
Control Structures
Behavioral control
There is an effective leadership and conflict management control system headed by Eisner. The behavioral control ensures the relationship between the employees themselves and between the employee and the company. They have established a mechanism to reward good behavior and to punish wrong behavior. There is an Imagineering unit in the company meant to improve the corporate behavior of the company.
Output control
There is output control responsible for all that comes out of the firm. This includes the studio skills. There are controls to monitor all the segments of the customers served and their buying behavior. The firm has also developed licensing and brand name as a control mechanism. There are many control mechanisms to control its distribution channel.
Works Cited
Smith, David. Disney: The First 100 Years. New York: Disney Editions, 2003. Print.