Internal Analysis Phenomena within Pixar
Pixar’s success can be attributed to the internal resources the company possesses. In terms of tangible resources, the company has financial capabilities which enable it to fund projects, create a desirable environment for its employees to grow, and support operations.
In terms of intangible resources, Pixar’s greatest asset is its pool of talents where the company relies on innovation and creativity while sustaining its reputation of producing quality films. Lastly, the organizational capabilities of the firm are outstanding where employees efficiently combine tangible and intangible resources to produce quality output.
With the investments of shareholders, Pixar was able to acquire the most advanced technologies in their pursuit of creating computer-generated films, fund creative programs in developing employees and devise ways to avoid collective burnout (Dress, Lumpkin, Eisener and McNamara, 2011).
Pixar’s success can also be attributed to its intangible resources where the company harnesses its talents by providing programs that enhance employees’ creativity, cooperation and avoid collective burnout. The creative culture built by Pixar’s founders together with Steve Jobs has enabled the effective execution of tasks by the organization as a whole (Dress, Lumpkin, Eisener and McNamara, 2011).
Organizational capabilities of the firm can be seen in the outputs Pixar has produced over the years namely the excellent quality of its films which are constantly recognized by the Oscars (Dress, Lumpkin, Eisener and McNamara, 2011).
Types of Pixar’s Resources
Pixar’s financial success can be attributed to its initial investors. In the late 1980s to the early 1990s, Steve Jobs invested $60 million in the company to support the operations of the computer animation firm (Dress, Lumpkin, Eisener and McNamara, 2011).
The success of Pixar’s partnership with Disney enabled the former to accumulate more income to fund programs to improve employees’ creative skills, purchase advance technologies and equipment for computer generated animations, and support operations.
The employees of Pixar are highly skilled in their chosen fields. The company funds further trainings and developments of its talents including the establishment of Pixar University where employees devote at least 4 hours of their time per week in participating in classes where their creative skills are being done (Dress, Lumpkin, Eisener and McNamara, 2011).
Another intangible resource of the company is its brand image and reputation. Over the years, Pixar has built its brand and reputation as a company providing quality animation films with the heart touching stories that inspire families.
Tangible and intangible resources of Pixar have been utilized by the company effectively, thus, the organizational capabilities of the said company are impressive. Pixar’s financial competencies enable the company to invest in creating a culture where employees’ well-beings and development are considered top priority.
This culture produces outstanding services rendered by the employees, thus, the quality of films produced by the company have been excellent. Multiple awards and recognitions by the Oscars are proofs of such investments (Dress, Lumpkin, Eisener and McNamara, 2011).
Pixar’s Resources and Sustainable Competitive Advantages
Resources of Pixar are valuable because they exploit opportunities and neutralize threats in Pixar’s environment (Dress, Lumpkin, Eisener and McNamara, 2011). They are rare because the company ensures that as much as possible, resources are produced by the company.
Engineers of Pixar develop software programs for the improvement of computer animation. Pixar’s culture is also very rare since such culture orients individuals how to be fun, free, and creative. This culture has been developed by the founders themselves.
Resources are also difficult to imitate since most crucial assets of the company are being produced by Pixar themselves, thus, it is difficult for competitors to imitate.
In terms of physical uniqueness, Pixar’s computer-generated animations are difficult to copy since the technologies used in creating such are produced by Pixar’s engineers. The uniqueness of Pixar’s culture which was developed through a distinctive series of events is difficult to copy.
The technologies developed by Pixar’s engineers together with the programs offered by Pixar University to its employees can be costly for competitors to imitate because it is very difficult to determine what resources are used and how they can be recreated. Pixar’s relationship with Disney and its strong ties with Apple enabled the company to have an advantage among its competitors.
Though substitutes may arise in copying Pixar’s resources, it is impossible for competitors to duplicate exactly the former’s resources. It would be challenging for competitors to do so because information of the resources used is not readily available.
Pixar’s top-of-the-line technology, winning culture, branding, reputation and relationships are close to impossible to imitate, thus, competitors may produce substitutes but they will not be as good as or better than that of Pixar’s.
Generation and Distribution of Pixar’s Profits
Pixar’s partnership with Disney in producing and distributing full-length feature films has enabled the former to accumulate a huge sum of profit over the years. The company’s different teams are responsible for the creation of animation films, thus, most of the company profit goes to the funding of employees’ development programs and salaries. The most talented employees are paid more and have bargaining power.
Employees possessing idiosyncratic and rare skills have high bargaining power. Examples of such talents are Alvy Ray Smith and John Lasseter who lead teams in the creation of animation films.
Reference
Dress, G., Lumpkin, T., Eisener, A., and McNamara, G. (2011). Strategic Management. New York: McGraw Hill.
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