The Walt Disney Company (“Disney”) originated with its animated characters and expanded into

other adjacent businesses with the goal of bringing happiness to families via several different,
but related avenues. In October 1923, Walter (“Walt”) and Roy Disney established the Disney
Brothers Studio and began creating animated films that would eventually be the foundation of
Disney. In 1937, Disney created Snow White and the Seven Dwarfs. This film is the only
animated film to rank in the American Film Institute’s list of the 100 greatest American Films of
all time.

In 1955, Disney opened its first theme park, Disneyland, in Anaheim, California, that spanned
over 160 acres. Opening day was not without issues. The temperature was over 101 degrees,
there was a plumber’s strike, and the asphalt had been recently placed (which made the heels
of women shoes sink into the ground). Even with all the negative press on opening day,
Disneyland has still been one of the most successful, frequently visited theme parks in history.
The construction of Disneyland was personally supervised by Walt.

In December 1966, Walt Disney passed away from lung cancer. Although he was an avid smoker,
he was always careful not to smoke around kids. Walt’s passing did not stop his brother Roy
from continuing to build on his brother’s dream. In 1971, Walt Disney World opened its doors in
Florida. Roy Disney passed away in late 1971. At that point, control of the company passed to
Donn Tatum, followed by Card Walker and then Ron Miller (Walt’s son in law).

Disney continued to expand by adding additional theme parks and media assets. In April 1983,
Disney launched The Disney Channel. The original intent was to be a premium channel that
catered to children and teenagers during the day and families in the evening. The Disney
channel, through the Mickey Mouse Club, is partially responsible for the success of stars such as
Britney Spears, Justin Timberlake and Christina Aguilera.

The Disney Empire was also expanding internationally. In 1983, Disney opened Tokyo Disney and
in 1992 Euro Disney. Tokyo Disney, located east of the city, has two theme parks and three
Disney hotels. Euro Disney has two theme parks and seven hotels. Today, Disney has over 11
Theme Parks and approximately 44 hotels surrounding the properties.

In 1993, Disney purchased Miramax Film Corporation from Harvey and Bob Weinstein for
approximately $70 million.

Miramax operated as a separate unit of Disney. The Weinstein brothers continued to run
Miramax under the supervision of Disney executives. By 2005 Miramax was valued at over $2
billion, with an extensive film library that included “Pulp Fiction” and “Shakespeare in Love”.

The relationship between Disney and the Weinstein brothers was filled with disagreements,
both financial and strategic. One of the more significant disagreements came over the release of
the controversial film “Fahrenheit 9/11” that targeted President Bush during the terrorist
attacks. Additionally, Disney claimed the Weinstein brothers paid themselves excessive bonuses
in years when Miramax was not profitable. In 2005, the Weinstein brothers left Miramax to
pursue other interests. Eventually, in 2010, Miramax was sold to Tutor-Saliba Corp.

Another major Disney acquisition took place on July 31, 1995 with the purchase of Capital Cities
/ABC for $19 billion.10 This gave Disney access to the television and cable networks of ABC and
ESPN.

In May 2006, Disney purchased Pixar for $7.4 billion in a cash and stock transaction.

The relationship between these two companies began in 1997 with an agreement to create five
films including Cars, Finding Nemo and The Incredibles. The deal was a mutually beneficial
transaction as it combined the computer animation power of Pixar with the marketing and
distribution strength of Disney. Along with the Pixar purchase, Steve Jobs, founder of Pixar and
Apple, joined the Disney board of directors.

In 2009, Disney purchased Marvel Entertainment for about $4 billion. This purchase gave Disney
access to several comic book characters, such as Spider-man, X-Men, Captain America and Thor.
The Marvel purchase should prove to be lucrative as Disney presents the various characters
through its many systems.

In October 2012, Disney acquired Lucasfilm from George Lucas for $4 billion in cash and
stock.13 Lucasfilm is most well-known for blockbuster movie hits such as Star Wars and Indiana
Jones. Along with this purchase, Disney announced future Star Wars films that will be released
in 2015. The Star Wars franchise films have earned over $4.4 billion in global box offices to date.

2.First Strategic Issue

Walt Disney has experienced various strategic issues, and their strategic approaches have led to success.
Its strategic management has identified the fact that their competitors could take advantage of the
strategic weaknesses and pull the company behind in terms of market position. Although the issues are
limited in such a successful company, they deserve maximum attention, as it is possible for them to act
as threats towards the future welfare of the entire business.

From a quick SWOT analysis, Disney's strengths are diversity and the surplus cash it attains from its
business operations. Its weaknesses include the two strategic issues it is recently facing, its opportunities
are expansion possibilities, and its threats include stiff competition. One of these strategic issues that
Walt Disney has been facing is the loss of a good number of subscribers in the ESPN. Recently, the
Entertainment and Sports Programming Network of Disney is holding fewer consumers as compared to
the past years when the company began. The major reason leading to this shift of customers to other
internet programs that offer similar services is the fact that watching sports with Disney has turned out
to be more expensive as compared to watching the same sports in other internet platforms. Its historical
market position, which was high at that time, had been attained through appealing to customers
regarding prices. When it is specifically about sports, there are different types of customers. Both adults
and youths across the globe have high interests in sports. However, the youths appear to have more time
to invest in the sports as compared to the time adults invest. Therefore, the larger portion of customers
consists of young people, who in most cases are jobless or flexible in terms their jobs. It is a fact that
with their flexibility regarding careers, the youth does not earn a lot of money, meaning they will always
take advantage of companies that deliver services at the least cost possible. When Disney was
affordable, it appealed to the two categories of customers successfully by ensuring that it is the most
affordable platform in the world. However, when the internet-based competitors found a way of
broadcasting sports at lower prices and others free, Disney did not pay attention to the matching of
these standards. For this reason, it lost the youths mostly to other companies. Losing its portion of
youths to the competitors is a great issue, which, were it not for other strengths that exist in the
business, would have caused the downfall of Disney as an international company.

Second Strategic Issue

The second strategic challenge that Disney is facing in the presence of its competitors is vitality in the
market. Disney is dealing with entertainment, which is all about the preferences and tastes of customers.
This dealing is capable of easily leading to its downfall if the company's management does not focus on
the strategic approaches of satisfying the customers' thirst in terms of what they have a passion for but
does not exist in the market. In case the product exists already, it is the duty of the company to modify it
and make it more interesting to the customers without altering the likes but scraping the dislikes. With
this sensitivity, Disney has faced criticism every time it has a new release in the market as much as it
faces motivating response. Bearing in mind that the two types of responses are from customers that the
company takes as a duty to please, making changes to attract a larger portion of motivating customers
than critics has been an all-time operational goal that may or may never be achieved. It becomes worse
when during its evaluation, Disney realizes a loss of positive claims having turned to critics. This is always
a clear message from the public that the company has made an unpleasant release and if they take it for
a trend, their market position will be at stake. This is how hard it is for Disney to maintain a good market
position having concentrated on the customers' taste and preferences alone. Other factors such as the
cost of services make the situation worse than it already is. These two strategic issues only need to be
attended to with the right approach in order to make the company's future bright (Rukstad & Collis,
2009).

3.
In 2012, CEO and President Robert Iger identified three particular strategies that have been effective for
Disney over the years. He declared that these three strategies have been especially instrumental in the
company’s success over the past seven years. Iger stated that Disney’s three major strategies have been
to “create high-quality content for families, making that content more engaging and accessible through
the innovative use of technology, and growing our brands and businesses in markets around the world”.

The Disney Company plans to continue with the strategies outlined by CEO Robert Iger, who stresses the
need to be adaptable and ever-changing to the consumer's wants and needs (Walt Disney Company
Annual Report and Shareholder Letter, 2012). In addition to adapting to meet the needs and wants of
consumers, the company has plans to adapt to meet growing consumer interests in foreign countries.
Today, their amusement parks are known worldwide and can be found on three different continents.
They also have stores in the United States, United Kingdom, France, Italy, Spain, and Portugal. In
addition, they have licensed shops and products all over the world. They are using the strategy of foreign
outsourcing to meet the company’s growing demands and, at the same time, to keep costs down. With
the company’s foreign markets, they are adapting well to other countries because they are adopting
many of the local customs while maintaining their American flavor. In addition, the company will
continue to follow the rules and regulations of the foreign countries where they build businesses. This
expense is one that Disney has included as a necessary one. The company plans to continue to build
their strategies for reaching global markets by following the standards of those countries and paying the
taxes of those countries.

The fact that Disney's markets are primarily entertainment based, and the entertainment industry
depends largely on the tastes of the public, represents another risk factor to the company. Those
preferences can change suddenly and without warning, causing a change in trends that could take the
company by surprise. Since Disney markets many of its products outside the United States, the
company’s success depends on the company being able to predict the tastes of consumers in other
countries and adapt to these changing tastes and preferences. The company often invests heavily in
hotels, entertainment, and other markets before knowing to what extent these investments will appeal
to the consumers.

4.

The reason why having a strategy is so important is because it gives business time to get a sense of how
they are preforming, what their capabilities are, and if these capabilities are able to help them grow. Not
all businesses get it right straight away. There are natural weakness within all organisations for various
reasons. What a business strategy does is try to remedy these weaknesses so that companies don’t trip
up and suffer their impact too greatly. Strategies look at these future risks and help develop ways in
which they can overcome these obstacles.

A well defined business strategy will offer a guide on how your business is performing internally. Also,
how you are performing against your competition and what you need to stay relevant into the future.
A strategy can identify trends and opportunities in the future. It can examine the broader changes in
market such as political, social or technological changes, as well as consumer changes, and can develop
tactics so your business can modify and develop to suit these future changes.

A business strategy creates a vision and direction for the whole organisation. It is important that all
people within a company have clear goals and are following the direction, or mission of the
organisation. A strategy can provide this vision and prevent individuals from losing sight of their
company’s aims.

Finally, by creating a business strategy a company can create a competitive advantage and ultimately
understand more about themselves and where they are going.