walt disney

ACKNOWLEDGEMENT

First of all we are grateful to Almighty Allah most beneficial & the most merciful, who has made us capable of making this report & has given us various opportunities for development in every walk of life.

We would also like to show gratitude towards my course instructor “Ma’mKiran” for teaching & making us capable enough to work on this report & providing us with great opportunity to learn how case study analysis is done in the corporate world. Without his complete guidance and support I would not have been able to complete this endeavour. I hope this report meets his standards and expectations.

TABLE OF CONTENT

1

2

S.NO TOPIC PAGE NO01. INTRODUCTION 4

02 THE FOUNDER 4

03 HISTORY 5

04 COMPANY OVERVIEW MEDIA NETWORKS PARKS & RESORTS THE WALT DISNEY STUDIOS DISNEY CONSUMER PRODUCTS DISNEY INTERACTIVE

6 - 25

05 GROWTH 26

06 LOCATION MAP 27

07 MISSION STATEMENT PROPOSED MISSION STATEMENT

28

08 COMPETITORS 28

09 STAGE 1: INPUT STAGE EXTERNAL FACTOR EVALUSTION (EFE )

MATRIX. COPMETITIVE PROFILE MATRIX (CPM) INTERNAL FACTOR EVALUATION(IFE)

MATRIX

29 - 32

10 STAGE 2: MATCHING STAGE1. SWOT MATRIX2. STRATEGIC POSITION & ACTION

EVALUATION (SPACE) MATRIX3. BOSTON CONSULTING GROUP (BCG )

MATRIX4. INTERNAL EXTERNAL (IE) MATRIX5. GRAND STRATEGIC MATRIX

33- 40

S.NO TOPIC PAGE NO11 STAGE 3: THE DECISION STAGE

1. QUANTITATIVE STRATEGIC PLANNING MATRIX (QSPM)

41-44

12 FINANCIAL POSITION OF WALT DESINEY COMPANY

1. INCOME STATEMENT2. BALANCE SHEET3. FINANCIAL RATIO ANALYSIS

45-49

13. IMPLEMENTATION STAGE1. ANNUAL OBJECTIVES & POLICIES2. STRATEGIES

50-52

14. RECOMMENDATIONS 53

15. CONCLUSION 54

INTRODUCTION:Walt Disney is one of the world's leading producers and providers of entertainment and information. It owns media networks as well as parks and resorts. The company also makes movies and markets consumer products. Walt Disney operates in North America, Europe, Asia Pacific and Latin America. It has strong portfolio of brands in entertainment business. Strong brand image helps the company attract consumers to its entertainment products. The company also has the option to leverage its strong brand image to enter new businesses.

THE FOUNDER:

Walt Disney 1901-1966

Walt Disney was born on December 5, 1901 in Chicago Throughout the drop of 1918, Walt Disney attempted to enlist for military service but

he got rejected. He started a small company called Laugh-O-Grams, which eventually fell bankrupt. With his suitcase, and $20 Walt headed to Hollywood to start anew. After making a success of his "Alice Comedies," Walt became a recognized

Hollywood figure. Disney took a deep interest in the establishment of California Institute of the Arts, a

college-level professional school of all the creative and performing arts. Walt Disney passed away on December 15, 1966. Urban legend maintains his corpse would be frozen and stored beneath the Pirates of

the Caribbean ride at Disneyland.

3

HISTORY

October 16, 1923:

This date is considered the start of the Disney Company first known as The Disney Brothers Studio.

1928:

First Mickey Mouse cartoon and the first appearance by Minnie Mouse.

1932:

Flowers and Trees, first full-colour cartoon and first Academy Award winner.

1939:

The Disney Studio begins its move to Burbank, California.

1940:

Walt Disney Productions issues its first stock.

4

COMPANY OVERVIEW:

For over 85 years, The Walt Disney Company has been the preeminent name in the field of family entertainment; the Disney name has symbolized creativity, innovation, trust, decency, optimism and quality. Disney, together with its subsidiaries and affiliates, is a leading diversified international family entertainment and media enterprise with five business segments:

1. MEDIA NETWORKS

Media Networks comprise a huge array of broadcast, cable, radio, business enterprise and digital businesses across 2 divisions – the Disney/ABC Television cluster and ESPN Inc. Additionally to content development and distribution functions, the section includes supporting headquarters, communications, digital media, and distribution, marketing, analysis and sales teams.

The Disney/ABC Television Group is composed of The Walt Disney Company’s global entertainment and news television properties, owned television stations group, as well as radio and publishing businesses. This includes the ABC Television Network, ABC Owned Television Stations Group, ABC Entertainment Group, Disney Channels Worldwide, ABC Family as well as Disney/ABC Domestic Television and Disney Media Distribution. Hyperion publishing and the Company’s equity interest in A&E Television Networks round out the Group’s portfolio of media businesses.

S.no Media Network1 ESPN2 Disney/ABC Television Group3 ABC Entertainment Group4 ABC News5 ABC Owned Television Stations Group6 ABC Family7 Disney Channels Worldwide8 Hyperion Books

1.1. ESPN

5

Industry: Sports Media

Founded: 1979

Headquarters: Bristol, CT

Properties: Eight U.S. TV networks (five w/HD services), ESPN International (48 networks plus HD, radio, digital platforms & more), ESPN Audio, ESPN.com, other sport- & market-specific sites, ESPN3, ESPN The Magazine, Mobile ESPN, Watch ESPN, owned events, and more.

1.2. DISNEY/ABC TELEVISION GROUP

Industry: Television, Radio, Publishing & Digital Media

Founded: 2004

Headquarters: Burbank, CA

Properties: ABC Entertainment Group, ABC Family, ABC News, ABC Owned Television Stations Group, Disney/ABC Television Group Digital Media, Disney/ABC Domestic Television.

1.3. ABC ENTERTAINMENT GROUP

6

Industry: Television & Digital Media

Founded: 2009


Properties: ABC Digital, ABC Entertainment, ABC Studios, Times Square Studios.

1.4. ABC NEWS

Industry: Television, Radio & Digital Media

Founded: 1962

Headquarters: New York, NY

Properties: ABC News Digital, ABC News Now, ABC News Radio

1.5. ABC OWNED TELEVISION STATIONS GROUP

7


Founded: 1948


Properties: WABC-TV New York, NY; KABC-TV Los Angeles, CA; WLS-TV Chicago, IL; WPVI-TV Philadelphia, PA; KGO-TV San Francisco, CA; KTRK-TV Houston, TX; WTVD-TV Raleigh-Durham, NC; KFSN-TV Fresno, CA; Live Well Network.

1.6. ABC FAMILY


Founded: 2001


Properties: ABC Family Digital, ABC Spark

1.7. DISNEY CHANNELS WORLD WIDE

8

Industry: Television, Radio & Digital Media

Founded: 1983


Properties: Disney Channel, Disney Cinemagic, Disney Junior, Disney XD, Hungama, Radio Disney.

1.8. HYPERION BOOKS

Industry:Publishing

Founded:1991


Properties:Hyperion, Voice

2. PARKS AND RESORTS

9

When Walt Disney opened Disneyland on July 17, 1955, he created a unique destination built around storytelling and immersive experiences, ushering in a new era of family entertainment. More than 55 years later, Walt Disney Parks and Resorts (WDP&R) has grown into one of the world’s leading providers of family travel and leisure experiences, providing millions of guests each year with the chance to spend time with their families and friends making memories that will last forever.

At the heart of WDP&R are five world-class vacation destinations with 11 theme parks and 43 resorts in North America, Europe and Asia, with a sixth destination currently under construction in Shanghai. WDP&R also includes the Disney Cruise Line with its four ships - the Disney Magic, Disney Wonder, Disney Dream and Disney Fantasy; Disney Vacation Club, with 11 properties and more than 500,000 individual members; and Adventures by Disney, which provides guided family vacation experiences to destinations around the globe.

S.no Parks and Resorts1 Disney Land Resorts2 Walt Disney World Resort3 Tokyo Disney Resort4 Disneyland Paris5 Hong Kong Disneyland6 Disney Cruise Line7 Disney Vacation Club8 Adventures by Disney9 Disney Shanghai Resort10 Aulani Disney Resort & Spa11 Walt Disney Imagineering

2.1. DISNEY LAND RESORT

10

Industry: Theme Park and Resort

Founded: July 17, 1955

Headquarters: Anaheim, California

Properties: Disneyland Park, Disney California Adventure

2.2. WALT DISNEY WORLD RESORT


Founded: October 1, 1971

Headquarters: Lake Buena Vista, Florida

Properties: Magic Kingdom, Epcot, Disney’s Hollywood Studios, Disney’s Animal Kingdom.

2.3. TOKYO DISNEY RESORT

11


Founded: April 15, 1983

Headquarters: Chiba Prefecture, Tokyo, Japan

Properties: Tokyo Disneyland Park, Tokyo Disney Sea

2.4. DISNEYLAND PARIS


Founded: April 12, 1992

Headquarters: Marne-la-Vallée in the IIe-de-France region

Properties: Disneyland Park, Walt Disney Studios Park.

2.5. HONG KONG DISNEYLAND


Founded: September 12, 2005

Headquarters:Lantau Island, Hong Kong

Properties: Hong Kong Disneyland Park

12

2.6. DISNEY SHANGHAI RESORT


Founded: Targeted to Open in Late 2015

Headquarters:Pudong New District, Shanghai

Properties: Shanghai Disneyland Park

2.7. DISNEY CRUISE LINE

Industry: Cruise Line

Founded: 1998

Headquarters: Port Canaveral, Florida

Properties: Disney Magic (1998), Disney Wonder (1999), Disney Dream (2011), Disney Fantasy (2012)

2.8. DISNEY VACATION CLUB

13

Industry: Timeshare

Founded: October 1991

Headquarters: Florida, South Carolina, California, Hawai‘i

Properties: Disney Vacation Club

2.9. AULANI DISNEY RESORT & SPA

Industry: Hotel and Timeshare

Founded: August 2011

Headquarters:KoOlina, O`ahu, Hawai‘i

Properties:Aulani, a Disney Resort & Spa, KoOlina, Hawai‘i

2.10. DISNEY ADVENTURE

14

Industry: Guided Vacations

Founded: 2005


Properties: Adventures by Disney

2.11. WALT DISNEY IMAGINEERING


Founded: December 16, 1952

Headquarters: Glendale, California

Properties: Walt Disney Imagineering

3. THE WALT DISNEY STUDIOS

15

For more than 85 years, The Walt Disney Studios has been the foundation on which The Walt Disney Company was built. Today, the Studio brings quality movies, music and stage plays to consumers throughout the world. Feature films are released under the following banners: Disney, including Walt Disney Animation Studios and Pixar Animation Studios; Disney nature; Marvel Studios; and Touchstone Pictures, the banner under which live-action films from DreamWorks Studios are distributed. The Disney Music Group encompasses the Walt Disney Records and Hollywood Records labels, as well as Disney Music Publishing. The Disney Theatrical Group produces and licenses live events, including Disney on Broadway, Disney on Ice and Disney Live.

S.no Walt Disney Studios1 Walt-Disney Studios Motion Pictures2 Marvel Studios3 Touchstone Pictures4 Disney nature5 Walt Disney Animation Studios6 Pixar Animation Studios7 Disney Music Groups8 Disney Theatrical Group

3.1. WALT DISNEY STUDIOS MOTION PICTURES

16

Industry: Live-Action Film Production

Founded: 1950


Properties: Disney

3.2. MARVEL STUDIOS

Industry: Live-Action Film Production

Founded: 1996

Headquarters: Manhattan Beach, CA

Properties: Marvel Studios

3.3. TOUCHSTONE PICTURES

17

Industry: Film Distribution

Founded: 1984


Properties: Touchstone Pictures

3.4. DISNEY NATURE

Industry: Nature Films

Founded: 2008

Headquarters: Paris, France

Properties: Disney nature

3.5. DISNEY ANIMATION STUDIOS

18

Industry: Animated Film Production

Founded: 1923


Properties: Walt Disney Animation Studios, DisneyToon Studios

3.6. PIXAR ANIMATION STUDIOS

Industry: Animated Film Production

Founded: 1986

Headquarters: Emeryville, CA

Properties: Pixar Animation Studios

3.7. DISNEY MUSIC GROUPS

19

Industry: Music

Founded: 1956 as Disneyland Records


Properties: Walt Disney Records, Hollywood Records, Disney Music Publishing

3.8. DISNEY THEATRICAL GROUP

Industry: Theatre

Founded: 1993


Properties: Disney Theatrical Productions (Disney on Broadway), Disney On Ice, Disney Live.

4. DISNEY CONSUMER PRODUCTS

20

Disney Consumer Products (DCP) is the business segment of The Walt Disney Company (NYSE:DIS) and its affiliates that extends the Disney brand to merchandise ranging from apparel, toys, home décor and books and magazines to foods and beverages, stationery, electronics and fine art. This is accomplished through a franchise-based licensing organization focused on strategic brand priorities, including: Disney Classic Characters & Disney Baby; Disney Live Action Film; Disney Media Networks & Games, Disney & Pixar Animation Studios; Disney Princess & Disney Fairies; and Marvel.

Other businesses involved in Disney's consumer products sales are Disney Publishing Worldwide, the world's largest publisher of children's books and magazines, and www.DisneyStore.com and www.DisneyStore.co.uk, the company's official shopping portals. The Disney Store retail chain, which debuted in 1987, is owned and operated by Disney in North America, Europe, and Japan.

S.no Disney Consumer Products1 Disney Licensing 2 Disney Publishing Worldwide3 Disney Store

4.1. DISNEY LICENSING

21

Industry: Licensing

Founded: 1929

Headquarters: Glendale, CA

Properties: All Disney, Disney-Pixar and Marvel properties

4.2. DISNEY PUBLISHING WORLDWIDE

Industry: Publishing

Founded: 1930

Headquarters: White Plains, NY

Properties: Disney Editions, Disney Hyperion, Disney Jump at the Sun, Disney Press, Disney Libros (Spain), and Disney Libri (Italy), Disney Book Apps, Disney Kids Magazines, and Disney Learning.

4.3. DISNEY STORE

22

Industry: Retail

Founded: 1987

Headquarters: Pasadena, CA

Properties: All Disney, Disney-Pixar and Marvel properties

5. DISNEY INTERACTIVE

23

Founded in 2008, Disney Interactive entertains kids, families and Disney enthusiasts everywhere with world class products that push the boundaries of technology and imagination. Disney Interactive creates high-quality interactive entertainment across all digital media platforms, including blockbuster mobile, social and console games, online virtual worlds, and #1-ranked web destinations Disney.com and the Moms and Family network of websites.

S.no Disney Interactive1 Disney Online2 Disney Games

5.1. DISNEY ONLINE

Industry: Digital Media

Founded: 1995

Headquarters: North Hollywood

Properties: Disney.com, DisneyFamily.com, Babble.com, DisneyBaby.com, BabyZone.com

5.2. DISNEY GAMES

Industry: Interactive Entertainment

Founded: 1986

Headquarters: Glendale, CA

Properties: Club Penguin, Where’s My Water, Disney Epic Mickey, Gardens of Time

GROWTH

1955:

24

Mickey Mouse Club debuts on television.

1971:

Walt Disney World Resort opens with the Magic Kingdom and two hotels near Orlando, Florida.

1982:

EPCOT Centre opens at Walt-Disney World Resort.

1983:

Tokyo Disneyland, the first international Disney theme park, opens in Japan.

1987:

The first Disney Store opens, in Glendale, California.

1989:

Disney-MGM Studios opens at Walt Disney World Resort.

1992:

Disneyland Paris opens.

1995:

Disney agrees to purchase 25 percent of the California Angels baseball team, Disney agrees to purchase Capital Cities/ABC for $19 billion. The Disney Channel begins operation in the UK.

1996:

Disney Online launches Disney.com.

Radio Disney, a live 24-hour music-intensive radio network, debuts.

1998:

ESPN Magazine debuts, Disney’s Animal Kingdom opens at Walt Disney World Resort, Disney Magic cruise ship departs on its inaugural cruise.

25

THE MISSION STATEMENT:

mission statement of Walt Disney is committed to balancing environmental stewardship with its corporate goals and operations throughout the world.

26

"The mission of The Walt Disney Company is to be one of the world's leading producers and providers of entertainment and information. Using our portfolio of brands to differentiate our content, services and consumer products, we seek to develop the most creative, innovative and profitable entertainment experiences and related products in the world."

PROPOSED MISSION STATEMENT:

By means of our collection of different brands, services and consumer products, we will become the most approachable and flexible to serve the needs of the consumers in our targeted markets and the most innovative and profitable entertainment experiences, most reliable and relevant informational services and related products in the world.

Competitors

Competitors of Disney are:

1. News Corporation, 2. Viacom, 3. NBC Universal4. Times Warner

They compete with Disney in all the five branches. However, Disney uses marketing more focused in the family, which calls for the parents, the ones that often has the power of purchase decision; while the others call customers individually. Hence, Disney has a marketing advantage while appealing for not only children but also for the parents. But, as kids grow, establish their tastes, and have their decisions taken into consideration by the parents while purchasing, Disney might lose market for being associated to younger children and family; while its competitors gain advantage for that reason.

Constantly making parents aware and comfortable with Disney goods and services, as well as their way of advertising, in order to reach the ones that have the purchasing power, is the marketing objective of The Walt Disney Company.

STAGE 1

INPUT STAGE27

1. EXTERNAL FACTOR EVALUSTION (EFE ) MATRIX.

2. COPMETITIVE PROFILE MATRIX (CPM)

3. INTERNAL FACTOR EVALUATION(IFE) MATRIX

EXTERNAL FACTOR EVALUATION (EFE MATRIX)

KEY EXTERNAL FACTORS Weight Rating Score

28

OPPORTUNITIES 1. Opportunity to build & renovate attractions in Park and

Resorts division to increase in profit.

2. Growth from cable and satellite operators creating even more

potential for Disney to make money with their network.

3. Target new costumers group.

4. Prospect to build more theme park and resorts worldwide.

5. Openings in other areas of the travel business.

6. Opportunity to invest in building theme parks to satisfy the

increase in guest spending, theme park attendance, and hotel

occupancy.

0.09

0.08

0.070.10.050.08

4

3

3434

0.36

0.24

0.210.40.150.32

THREATS 1. Lasting economic recession leading to slow growth rate.

2. Park and Resorts Divisions’ success is unpredictable because

of exchange rate fluctuations; travel industry trends; amount

of available leisure time; oil and transportation prices; and

weather patterns and seasonality.

3. Changes in technology leads customers to stream online

instead of buying DVD.

4. Online streaming makes Disney vulnerable to piracy and

violation of its intellectual property.

5. High unemployment rate

6. Retail distribution business is influenced by seasonal

consumer purchasing behavior and by the timing and

performance of animated theatrical release.

7. Increase in labor cost which will have a noticed impact in

Walt- Disney expenses due to their large amount of

employees.

0.080.1

0.07

0.06

0.06

0.1

0.06

34

3

2

2

4

2

0.24 0.4

0.21

0.12

0.12

0.4

0.12

TOTAL 1.00 3.29

COMPETITIVE PROFILE MATRIX

29

Walt Disney Time WarnerNews

Corporation

critical success factor Weight Rating Score Rating Score Rating Score

Advertising 0.12 4 0.48 4 0.48 2 0.24

Technology 0.09 3 0.27 4 0.36 3 0.27

Management 0.09 3 0.27 3 0.27 3 0.27

Financial position 0.11 4 0.44 4 0.44 3 0.33

Customer loyalty 0.12 4 0.48 4 0.48 3 0.36

Global expansion 0.12 4 0.48 4 0.48 4 0.48

Market share 0.11 3 0.33 4 0.44 2 0.22

Company Image 0.12 4 0.48 3 0.36 3 0.36

Production capacity 0.12 3 0.36 3 0.36 2 0.24

Totals 1 3.59 3.67 2.77

INTERNAL FACTOR EVALUATION (IFE) MATRIX

30

KEY INTERNAL FACTORS Weight Rating Score

STRENGTHS 1. One of the most familiar an amusement

company in the world.2. Strong advertising.3. Wide and unique portfolio.4. Innovative entertainment business.5. Strong customer service6. Strong Media Networks and Broadcasting

division.7. Disney owns a range of companies, which

permits them to come up with high profits from different industry division such as Media Networks and Broadcasting, Park and Resorts, Studio Entertainment and Disney Consumer Products.

8. Disney is the largest worldwide licensor of character-based merchandise and producer of children’s film-related products based on retail sales.

0.09

0.07 0.1

0.060.040.050.08

0.08

4

344344

4

0.36

0.210.40.240.120.20.32

0.32

WEAKNESSES 1. Studio entertainment and Disney consumer

product divisions have been experiencing

declining revenue for the last few years.

2. Disney has a narrow target market.

3. Disney as such a diversify product range that it can reduce efficiency and lead to a lack of strategic focus.

4. High cost of entertainment production.

5. High employee turnover.

6. Costs of operation are high.7. Walt Disney’s Park and Resorts are not easily

accessible which leads people to associate

Disney World with a costly trip.

0.09

0.04

0.04

0.07

0.04 0.08

0.07

1

2

2

2

211

0.09

0.08

0.08

0.14

0.080.080.07

TOTAL 1.00 2.79

STAGE 2

31

THE MATCHING STAGE

1. SWOT MATRIX2. STRATEGIC POSITION & ACTION EVALUATION (SPACE)

MATRIX3. BOSTON CONSULTING GROUP (BCG ) MATRIX4. INTERNAL EXTERNAL (IE) MATRIX5. GRAND STRATEGIC MATRIX

SWOT MATRIX

STRENGTHS

1. One of the most familiar an

WEAKNESSES

1. Studio Entertainment and

32

amusement company in the world.

2. Innovative entertainment business.

3. Strong Media Networks and Broadcasting division.

4. Disney is the largest worldwide licensor of character-based merchandise and producer of children’s film-related products based on retail sales.

5. Strong advertising.

Disney Consumer Products divisions have been experiencing declining revenue for the last 3 years.

2. Disney as a narrow target market.

3. Disney as such a diversify product range that it can reduce efficiency and lead to a lack of strategic focus.

4. Walt Disney’s Park and Resorts are not easily accessible which leads people to associate Disney World with a costly trip.

OPPORTUNITIES

1. Opportunity to build & renovate attractions in Park and Resorts division to increase in profit.

2. Growth from cable and satellite operators creating even more potential for Disney to make money with their network.

3. Target new costumers group.

4. Prospect to build more theme park and resorts worldwide.

5. Openings in other areas of the travel business.

6. Opportunity to invest in building theme parks to satisfy the increase in guest spending, theme park attendance, and hotel occupancy.

SO-STRATEGIES

1. The park & resorts division is experiencing profit. Therefore the money could be used to innovate some attraction. (O1, S1, S2)

2. Sell Disney products at more places at not only Disney stores. Especially with Disney’s with highly recognized characters by children.(02, S2, S3, S4)

3. Build more accessible resorts internationally since there is an increase in guest spending, theme park attendance and hotel occupancy. (O4, O5, O6, S1, S2)

4. Better advertise of other parks of Walt Disney world such as EPCOT resort, in order to break the reputation that Disney is only a magic kingdom and appeals to children. (S5, O3).

WO- STRATEGIES

1. Create block buster motion picture movies with the 3D option, which is the new trend in movie theaters. (W1, O3)

2. Design parks and resorts with a new modern strategy, which will find a better balance between ages.(W2, O3, W3)

3. Build parks and resorts in worldwide to be more accessible and allow people to enjoy a one day experience rather than a week long trip.(W4, O4, O6)

THREATS

1. Lasting economic recession leading to slow growth rate.

2. Park and Resorts Divisions’ success

ST- STRATEGIES

1. Offer lower fees for entrance into theme parks and discounts on onsite hotel prices. (T2, T1, S1)

WT-STRATEGIES

1. Build an indoor park and resort on the north east side United States in order to be more accessible and to prevent closure

33

is unpredictable because of exchange rate fluctuations; travel industry trends; amount of available leisure time; oil and transportation prices; and weather patterns and seasonality.

3. Changes in technology leads customers to stream online instead of buying DVD.

4. Online streaming makes Disney vulnerable to piracy and violation of its intellectual property.

2. Have a movie rental website with high definition and high speed movies for low prices. (T3, T4, S3)

with unpredictability of weather.(W4, T1)

STRATEGIC POSITION AND ACTION EVALUATION (SPACE) MATRIX

FINANCIAL POSITION (FP) RATING1. Liquidity 62. cash flow 4

34

3. Return on investment 44. Earnings per share 2

Total 16Average = 16 /4 4

STABILITY POSITION (SP) RATING1. Demand variability -62.Price range from competing products. -13. Barriers to entry. -14. Price elasticity of demand -5

Total -13Average = −13/ 4 -3.25

INDUSTRY POSITION (IP) RATING1. Ease of entry. 62. Growth potential 63. Financial stability 34. profit potential 6

Total 21Average = 21/4 5.25

COMPETITION POSITION (CP) RATING1. Market share -1

2. product quality -1

3. Customer loyalty -3

4. Control over suppliers and distributers -3

Total -8Average = −8 /4 -2

CALCULATION

FP average is = 4 SP average is = -3.25IP average is = 5.25 CP average is = -2

DIRECTIONAL VECTOR COORDINATES

X-axis:- 2 + (5.25) = 3.25

Y-axis: -3.25+ (4) = 0.75

35

Strategies:

Market Development Market Penetration Product Development Forward Integration Backward Integration Horizontal Integration Related Diversification Unrelated Diversification

BOSTON CONSULTING GROUP (BCG ) MATRIX

36

INTERNAL-EXTERNAL (IE) MATRIX

37

The Internal-External (IE) matrix is another strategic management tool used to analyze working conditions and strategic position of a business. The Internal External Matrix or IE matrix is based on an analysis of internal and external business factors which are combined into one suggestive model.

Total weighted score of EFE is 3.29, it is high and the score of IFE is 2.79 average positions.

IFE Total weight scores

Strong Average Weak 3.0 to 4.0 2.0 to2.99 1.0 to 1.99

4.0 3.0 2.79 2.01.0

EFE High Total 3.0 to 4.0 3.29

Weight 3.0 scores

Medium 2.0 to2.99 2.0

Low 1.0 to 1.99

1.0

This position described on grows and build. This position Intensive (market penetration, market development and product development) or integrative (backward integration, forward integration, and horizontal integration) strategies.

GRAND STRATEGIC MATRIX

38

Walt Disney located in Quadrant 1 of the grand strategy matrix are in an excellent strategic position. For these Walt Disney continued concentration on current markets (market penetration and market development) & products (product development) is an appropriate strategy. Walt Disney has excessive resources so backward, forward or horizontal integration are effective strategies. Walt Disney can afford take advantage of external opportunities in several areas. They can take risks aggressively when necessary.

39

STAGE 3

THE DECISION STAGE

1. QUANTITATIVE STRATEGIC PLANNING MATRIX (QSPM)

QUANTITATIVE STRATEGIC PLANNING MATRIX (QSPM)

40

STRATEGIC ALTERNAIVE

Expand parks & resorts world wide

Improve products to target young costumer as well as older one.

KEY FACTORS Weight AS TAS AS TAS External

OPPORTUNITIES:1. Opportunity to build & renovate attractions in Park and Resorts division to increase in profit.2. Growth from cable and satellite operators creating even more potential for Disney to make money with their network.3. Target new costumers group.4. Prospect to build more theme park and resorts worldwide.5. Openings in other areas of the travel business. 6. Opportunity to invest in building theme parks to satisfy the increase in guest spending, theme park attendance, and hotel occupancy.

0.09

0.08

0.10.05

0.08

0.07

3

-

44

4

-

0.27

0

0.40.2

0.32

0

3

3

--

-

4

0.27

0.24

00

-

0.28

THREATS:1. Lasting economic recession leading to slow growth rate.2. Park and Resorts Divisions’ success is unpredictable because of exchange rate fluctuations; travel industry trends; amount of available leisure time; oil and transportation prices; and weather patterns and seasonality.3. Changes in technology lead customers to stream online instead of buying DVD.4. Online streaming makes Disney vulnerable to piracy and violation of its intellectual property.5.High unemployment rate6. Retail distribution business is influenced

0.08

0.06

0.1

0.07

0.06

0.1

4

-

1

-

-

-

0.32

-

0.1

-

0

-

1

-

-

2

-

2

0.08

-

0

0.14

0

0.2

41

by seasonal consumer purchasing behavior and by the timing and performance of animated theatrical release. 7. Increase in labor cost which will have a noticed impact in Walt- Disney expenses due to their large amount of employees.

0.06 2 0.12 - 0

Internal:

STRENGTHS:

1. One of the most familiar an amusement company in the world.

2. Strong advertising.

3. Wide and unique portfolio.

4. Innovative entertainment business.

5.Strong customer service

6.Strong Media Networks and Broadcasting division.

7. Disney owns a range of companies, which permits them to come up with high profits from different industry division such as Media Networks and Broadcasting, Park and Resorts, Studio Entertainment and Disney Consumer Products.

8.Disney is the largest worldwide licensor of character-based merchandise and producer of children’s film-related products based on retail sales.

0.09

0.07

0.1

0.06

0.04

0.05

0.08

0.08

4

4

4

4

3

-

-

-

0.36

0.28

0.4

0.24

0.12

-

0

0

4

4

4

4

-

4

4

-

0.36

0.28

0.4

0.24

0

0.2

0.32

0

WEAKNESSES:

1. Studio entertainment and Disney consumer product divisions have been experiencing declining revenue for the last few years. 2. Disney has a narrow target market.

0.09 2 0.18 2 0.18

42

3. Disney as such a diversify product range that it can reduce efficiency and lead to a lack of strategic focus.4. High cost of entertainment production. 5. High employee turnover. 6. Costs of operation are high.7. Walt Disney’s Park and Resorts are not easily accessible which leads people to associate Disney World with a costly trip.

0.040.04

0.070.04

0.08

0.07

22

12

1

1

0.080.08

0.070.08

0.08

0.07

1-

--

-

2

0.040

0-

-

0.14

Total: 1 3.77 3.37

FINANCIAL POSITION OF

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WALT DESINEY COMPANY

1. INCOME STATEMENT2. BALANCE SHEET3. FINANCIAL RATIO ANALYSIS

INCOME STATEMENT

(in Millions, except per share data) Year 2009

Sales revenue $ 36149.00

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Cost & expenses $ (30452.000)Restructuring and impairment charges $(492.00Other income (expense) $342.00Net interest expense $(466.00)Equity in the income of investees $577.00

Income from continuing operations before income taxes and minority interests

$5,658.00

Income taxes $(2,049.00)Minority interests $(302.00)Income from continuing operations $3,307.0Discontinued operations, net of tax ------Net income $3,307.0

Diluted earnings per share:Earnings per share, continuing operations $1.76Earnings per share, discontinued operations

Earnings per share $1.76

Basic earnings per share:Earnings per share, continuing operations $1.78Earnings per share, discontinued operations

Earnings per share $1.78Weighted average number of common and common equivalent shares outstanding: Diluted $1,875.00Basic $1,856.00

BALANCE SHEET

ASSETS EQUITIES

Current assets Current liabilities

Cash & cash $3417.00 Accounts payable& $5616.00

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equivalent other accrued liabilitiesCurrent Portion of borrowing

$1206.00

Unearned royalties & other

$2112.00

Accounts receivable $4854.00

Merchandise .inventory

$1271.00

Television Cost $631.00

Deferred Income Taxes

$1140.00

Other current Assets $576.00

Total Current Assets $11,889.00 Total Current Liabilities

$8934.00

Film & television cost

$5125.00 Borrowings $11495.00

Investments $2554.00 Deferred Income taxes

$1819.00

Park, resorts & other property, at attractions, building & equipment

$32475.00 Other long-term liabilities

$5444.00

Accumulated depreciation

$(17395.00) Minority Interest $1691.00

$15080.00 Commitments & contingencies shareholder’s equity preferred stocks, $.01 par value Authorized 100 million shares issued non-common stocks $.01 par value Authorized 3.6 billion shares issued.

Project in progress

$1350.00

Land $1167.00

Intangible Assets $2247.00

Goodwill $21683.00

Other Assets $2022.00 2.6 billion shares $27038.00

Retained Earning $31033.00

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Accumulated other comprehensive

$(1644.00)

$56427.00

Treasury Stocks at cost 781.7 million shares at october3, 2009 & 777.1 million shares at September 27, 2008.

$(22693.00)

Total Assets: $63,117.00 Total Liabilities $63,117.00

FINANCIAL RATIO ANALYSIS:

2009 2008Liquidity RatiosCurrent Ratio 1.33 1.01

Quick Ratio 1.19 0.91

Leverage Ratios

Debt-to-Total Assets Ratio 1 1

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Debt-to-equity Ratio 1.12 1.93

Long-term debt-to-equity

Ratio

0.1 0.12

Times-Interest-earned Ratio -12.14 -14.13

Activity Ratios

Inventory Turns 28.44 33.67

Fixed Assets Turnover 1.11 1.2

Total Assets Turnover 0.57 0.61

Profitability Ratios

Gross Profit margins 1.84 1.8

Operating Profit Margin 0.16 0.2

Net Profit Margin 0.09 0.12

Return on Total Assets 0.05 0.07

Return on Stockholders

equity

0.06 0.14

Earnings per share 1.78 2.34

Price-earnings Ratio 15.31 12.61

Growth Rations (yearly)

Sales -4.48% 7.66%

Net Income -25.30% -5.55%

IMPLEMENTATION STAGE

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1. ANNUAL OBJECTIVES& POLICIES2. STRATEGIES

ANNUAL OBJECTIVES AND POLICIES

1. The annual objectives and policies proposed consist of identifying opportunities for acquisition or entering into a new market, creating a project team to capture the opportunity, and moving into operations management among various time intervals.

2. Allow the SBUs freedom for creativity while maintaining functional efficiencies

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3. Maintain aggressive profit growth by funding projects with the greatest NPV

It is recommended that the project coordination team be developed to maintain projectmanagement best practices without being overly intrusive to the project’s objectives. Also,acquisitions must be monitored as well since these will represent a bulk of the company’sgrowth strategy. Subsequently, change management practices must be adhered to during suchintegrations. Disney must also be cognizant of the corporate culture that is subject to anyacquisition to ensure that integration does not come with insurmountable resistance.

In the next year Walt Disney should be:

Improve advertising to promote entertainment

Remove the Interactive Media Segment

Buy a land in New York City

STRATEGIES

1. THE DREAMER

The place where dreams were dreamed, ideas were spun out, no restrictions, no limits - just every sort of outrageous creative hunch or idea was freely developedThis is where the visionary big picture is produced. With no boundaries, limitations or restraint. The dreamer position typically ‘sees’ the ideal future. Ask yourself "What do customers really want, in an ideal world?" Then see it. The three roles (Dreamer, and the two

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mentioned in the next two items) can all be within the same person, by the way. It’s similar to Edward De Bono’s Six Thinking Hats, if you’ve ever used that approach to creativity – wearing a different hat means adopting that position and outlook for a while. So, you’d say to yourself, ‘For the next hour I am going to dream up what we want for our customers and picture it in as much details as possible.’ This can actually be a group rather than just you – Convene a ‘dreamer group’ to come up with what Ken Blanchard (One Minute Manager author) would call the ideal organization for your customer.

2. THE REALIST

This is the second role within the Disney Creativity Strategy, where the plans are organized, and evaluated to determine what is realistic. Think constructively and devise an action plan. Establish time frames and milestones for progress. Make sure it can be initiated and maintained by the appropriate person or group. Ask yourself "What will I do to make these plans a reality?" Again, this could be a group meeting rather than an individual. In fact, it could be the same group, with a different brief – The Dreamer Group becomes The Realist Group.

3. THE CRITIC

The third role in the Disney Creativity Strategy, according to Robert Dilts. This is where you test the plan, look for problems, difficulties and unintended consequences. Think of what could go wrong, what is missing, what the spins-offs will be. Remember that a critic is someone who should evaluate - not just point out what is wrong. Ask yourself "What could go wrong and how do we adjust to accommodate that?”

RECOMMENDATIONS

In the next three years Walt Disney should..

Build an indoor theme Park and Resort in New York.

Improve advertising to promote entertainment which target a more mature audience.

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Remove the Interactive Media Segment.

Remodel and build new attractions in every Park and Resorts to stay appealing to our

customers.

CONCLUSION

Walt Disney has definitely worked its way into the hearts of almost everyone who watches it. The Disney company has managed to bring fantasies to life on the movie screen for over 80 years. Walt Disney Studios is still a strong, American icon thanks to its innovation, fantasy, and artistic style.

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