Presented by:

Harram Aneeqa

Some historical clues…

Founded by Walt DisneyEstablished in 1923Headquartered in California, USACurrently world’s largest conglomerate in

terms of revenue.

Walt Disney: In 1920s

Walt Disney: Today

Corporate

CEO

Chairman, Walt Disney International

Senior Executive Vice President, General Counsel and Secretary, The Walt Disney

Company

Senior Vice President, Global Security, The Walt Disney Company

Executive Vice President and Chief Communications Officer, The Walt Disney

Company

Executive Vice President and Chief Human Resources Officer, The Walt

Disney Company

Business Unit CEO

Executive Chairman, ESPN, Inc.

President, Disney Consumer Products

Chairman, The Walt Disney Studios

President, Disney Interactive

Co-Chairman, Disney Media Networks Group and

President, ESPN

Walt Disney Organizational Structure

Walt Disney Mission Statement 2013

“The Walt Disney Company's objective is to be one of the world's leading producers and providers of entertainment and

information, using its portfolio of brands to differentiate its content, services and consumer products. The company's

primary financial goals are to maximize earnings and cash flow, and to allocate capital toward growth initiatives that will drive

long-term shareholder value.”

Walt DisneyMission Statement’s Evaluation

Product oriented statement

Focus on what products to sell

and what services to offer rather than

on how to satisfy customer needs

Lack of 5 essential components:

1. Customers2. Technology3. Philosophy4. Concern for

public image5. Employees

Walt Disney Recommended Mission Statement

“As the world’s leader in entertainment and information we seek to create an engaged and collaborative culture for our employees in order to turn our customers‘ moments into a unique experience, by providing special services and innovative products through movies, parks and the e-world. By taking advantage of our diversified portfolio to differentiate our content in all segments, we aim to develop the most profitable entertainment company worldwide, which would yield increasing profits to our shareholders.”

Walt Disney Vision Statement

“To make people happy ”

Walt Disney Proposed Vision Statement

“To make entertainment the wheel of life”

Walt Disney DivisionsMedia Networks

• ESPN• Disney/ABC Television

Group• ABC Entertainment Group• ABC News• ABC Owned Television

Stations Group• ABC Family

Park and Resorts

• Disney Land Resorts• Walt Disney World Resort• Tokyo Disney Resort• Disneyland Paris• Hong Kong Disneyland• Disney Cruise Line• Disney Vacation Club• Adventures by Disney

Cont…..

The Walt-DisneyStudios• Walt-Disney Studios

Motion Pictures• Marvel Studios• Touchstone Pictures• Disneynature• Walt Disney Animation

Studios• Pixar Animation Studios• Disney Music Groups• Disney Theatrical Group

DisneyConsumerProducts

• Disney Licensing • Disney Publishing

Worldwide• Disney Store

Market penetration

• Targeted market segmentation through acquisitions

New products

• Related Diversification• Diversification in branding• Vertical & Horizontal integration

Market development

• Foreign Outsourcing• Direct Investment• Licensing

Conglomerate diversification

-

Existing

New

Existing New

PRODUCTS

MARKETS

Walt Disney Corporate Strategies

SWOT Analysis

Strengths Weaknesses

Walt Disney SWOTCombined Strategies

1. Brand Reputation2. Highly Diversified Portfolio3. Strategic & Tactical Acquisitions4. Global Expansion & Alliances5. Top Management6. Loyal Customers7. Strong Financial Position

1. High Cost of Operations2. Concetration of Revenues In North

America3. Approaches Antitrust Law Limits

Opportunities SO - Strategies WO - Strategies

1. Benefits From IT Advances & Mobile Gaming

2. Further expansion in new emerging economies (India, Russia)

3. Release of New Successful Stories & Characters

2-1: Develop mobile game applications with Disney characters1-2: Collaborating with WWF so as to promote environmental issues6-3: Build a multinational management team

1-1: Digitalization of our operations in order to low costs & utilize technology2-3: Target India as possible expansion through consumer products

Threats ST - Strategies WT - Strategies

1. Financial Récession2. Increasing Piracy3. Strong Competition4. Continous Need For Technological

Update5. Change in Consumers Preferences &

Tastes6. Negative Publicity Due to

Unexpected Event

7-1: Offer discounts to all members of Disney fun club3,4-3: Expansion in Brazil market through alliances and synergies8-4: Invest on R&D for one high tech department6-5: Monthly consumer research via online polls

1-1: Re-edit and release in cinemas old classic Disney films2-3,4: Take advantage of operations that take place in N. America by investing in Technology and R&D for that area

Competitive Profile MatrixWALT DISNEY WARNER BROS UNIVERSAL

CRITICAL SUCCESS FACTORS WEIGHT

RATING1 - 4

SCORERATING

1 - 4SCORE

RATING1 - 4

SCORE

Advertising .12 4 .48 4 .48 3 .36

Market Share .10 3 .30 4 .40 2 .20

Financial Position .10 4 .40 3 .30 2 .20

Management .08 3 .24 3 .24 3 .24

Global Expansion .10 4 .40 4 .40 4 .40

Technology .15 3 .45 4 .60 3 .45

Customer’s Loyalty .10 3 .30 3 .30 2 .20

Brand Awareness .15 4 .60 4 .60 3 .45

Creativity .10 4 .40 4 .40 4 .40

TOTAL 1.00 3.57 3.72 2.90

“I do not like to repeat successes, I like to go on to other things.”

Walt Disney

Current Scenario of case study

Disney - contribution of segments to revenues in current scenario

Media Networks 45%Parks & Resorts 31%Studio Entertainment 13%Consumer Products 8%Interactive 3%

Financial Trends During 2007-2009

 Net Profit

Margin (%) Debt/ EquityReturn on Equity (%)

Return on Assets (%) Interest Coverage

01-Oct-09 9.1 0.38 9.8 5.2 9.6

01-Sep-08 11.7 0.46 13.7 7.1 10.4

01-Sep-07 13.2 0.5 15.2 7.7 10.4

01-Sep-06 9.8 0.43 10.4 5.5 7.5

01-Oct-05 7.8 0.49 9.4 4.6 6.3

Balance Sheet

Now What happened in 2009!!!

Selected Financial Ratios 2009 2008Liquidity Ratios Current Ratio 1.33 1.01Quick Ratio 1.19 0.91Leverage Ratios Debt-to-Total Assets Ratio 1 1Debt-to-equity Ratio 1.12 1.93Activity Ratios Inventory Turns 28.44 33.67Fixed Assets Turnover 1.11 1.2Total Assets Turnover 0.57 0.61Profitability Ratios Gross Profit margins 1.84 1.8Operating Profit Margin 0.16 0.2Net Profit Margin 0.09 0.12Return on Total Assets 0.05 0.07Return on Stockholders equity 0.06 0.14

Earning per share 1.78 2.34Price-earnings Ratio 15.31 12.61

Growth Rations (yearly) Sales -4.48% 7.66%

Net Income -25.30% -5.55%

• Eliminate 10 billion out of the borrowings from the retained earnings• Finance 1 billion to buy a land in order

to open indoor resort in New York in the next three years. • Invest 10 million for advertisement • Spend 1 billion in each of the five

existing Park for renovation and new attractions.

Assumptions

Total Investment of 19.01 billion

• High Employment• Recession• Slow economic growth• Reduced customer spending

All contributed to a 7 percent drop in

revenue and a 46 percent drop in Walt Disney’s profitability for the first quarter of 2009.

• Build an indoor theme Park and Resort in New York.

• Improve advertising to promote entertainment which target a

more mature audience.

• Remove the Interactive Media Segment.• Remodel and build new attractions in every Park and Resorts to

stay appealing to our customers. • Overcome 2 entertainment industry’s challenges:

- File sharing- Copyright infringement

• Adapt and change their management system in order to integrate into the digital age

• Follow its philosophy to make people happy• Recognize new technology trends and develop plans to minimize

the risks associated with technology

RecommendationsIn the next three years Walt Disney

should..

Conclusion

• Strategic Planning Needed• Implement strategies that help lower costs,

and maintain competitive advantage• Balanced approach to innovation and cost-

savings

Any Questions????