By: Martin Rowell
1-1 Blog Critical Thinking for Business Decisions
TOPIC: Disney’s Diversification Strategy
It is safe to say that Disney is a well known brand. You can’t go anywhere in the united states and not see something that comes from Disney directly or Disney owns. The company is a huge content machine to say the lease and they have been able to create a brand and experience that many people easily identify and love (or at least I do). Even with Disney being this huge power house, they have to always be changing to meet the needs of their company. In 2018, Disney made the choice to make several strategic reorganization with the goal of putting themselves in a better position to serve customers globally, increase growth, and maximize shareholder value. These changes were combining all their direct-to-consumer services into a single business and electing Kevin Mayer as the chairman of this new segment, combine all parks, resorts, and consumer products into one hub and elect Bob Chapek as the chairman of this new segment.
APPLICATION:
When we think about applying critical thinking to decision making we have to make sure that we are taking in all the information needed to provided the best remedy to a problem or an issue. In this situation, we see that Disney has several issues to remedy based on their 2018 reorganization decision. Their choice to reorganize and consolidate multiple departs into one and assign people who would help ensure the success of these new departments based on their past track record shows that Disney thoroughly thought out their strategy with the goal of achieving their goals set in 2018.
ANALYSIS:
When we look at Disney media, it is clear that they have a lot of their own content and they also own a lot of other content that isn’t made directly by Disney (such as ESPN), so it make sense for Disney to take advantage of all this content and produce a single point of service where customer can come to access all their content. This helps ensure also more control of how Disney content is consumed by customers and eliminates any middle men Disney has used in the past which cuts down costs.
When we look at the resorts and products being combined. It makes sense to ensure that the quality of services offered at resorts and parks match the quality of products sold at store around the world. This will help make sure the people who love Disney would get the full Disney experience regardless of what they purchase. Combing these departments also allows the departments to share resources and ideas which should speed up innovation and cut down on overall costs.
CONCLUSION:
Looking at the last three years since this report was released, it is clear that this was a great move on their part. Though I am not fully sure how the parks are doing after the pandemic, it is clear the media side has been doing well. Disney know has their own streaming service and a bundle with Hulu which I believe now are the only places that customers can now see Disney content and Disney owned content. Disney took advantage of it’s content that it owns and decided to create a way to sell it to consumers directly eliminated the middle man. It was a smart move on Disney’s part and I am curious if this strategy will be expanded to other areas like the movie industry.
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