A few years after the death of its founder, Disney went through a rough patch. However, its leadership was determined to conquer new mountain tops and not let the past glories be the highest point in the company’s history.
Pursuing moon shots and pushing a company to its limit is admirable and often leads to innovative new ideas. Nonetheless, sacrificing the brand or the culture and the people of the company in the process is not sustainable in the long run. It needs exceptional skill to balance the pursuit of moon shots and long-term sustainability.
Lack of Creativity and Bob Iger’s First Big Move
As Animation goes, so goes the company
Bob Iger was working for The Walt Disney Company since 1996 before he became CEO and was quite familiar with its history. He recognized that the company’s performance was tightly bound to the animation industry and its ability to create great animated films. In his own words to his board “as Animation goes, so goes the company.”
In the era from the ‘20s to the ‘40s and the success of movies like “Snow White and the Seven Dwarves,” “Pinocchio,” “Dumbo,” “Cinderella,” and all those great animated movies that Walt Disney built, the company prospered. Even later on, in the Disney Renaissance period when Michael Eisner had taken over the company, The Walt Disney Company created excellent animated films like “The Little Mermaid”, “Beauty and the Beast”, “Aladdin”, “The Lion King” that restore the company’s leadership role in the animation industry.
Nevertheless, when Bob Iger’s tenure started in 2005, he knew that Disney Animation was performing poorly and was overall in a bad shape for the last decade. He realized that Disney’s near future and his own as the head of The Walt Disney Company were hanging on his ability to revitalize the company’s animation productions.
Disney’s Top Three Strategic Priorities
Bob Iger became the head of Disney with three clear priorities in mind. The first was the creation of exceptional branded content. His understanding of the market was that brand perception would guide people’s choices, so he had decided to invest most of the company’s capital on this.
His second priority was exploiting technological advancements to aid the creation of exceptional content and staying relevant in its distribution. He sensed that consumer behavior was changing, and he believed it was imperative to commit to the pursuit of technological innovations.
The third priority was international expansion. Disney was present in many markets but with superficial penetration. For example, China and India, two of the most populous countries in the world, were underutilized. He believed that the opportunity that was lurking in those markets was significant and Disney should tap into it.
His decision to rejuvenate the brand and Disney Animation was in complete alignment with his strategic priorities. The need for a solution to the creative stagnation of the company was urgent and echoed throughout all of its businesses.
The only source of talent and innovation
Iger quickly came to the conclusion that reviving Disney Animation meant finding the best, most talented animators and leaders in the industry. And so his gaze immediately turned to Pixar, the leading animation company of the time. On his second day as CEO, he presented his radical and, as time proved, outstanding idea of Disney acquiring Pixar.
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