The Walt Disney Company was integrated in the year 1995 as a diversified global mass media and entertainment enterprise. The firm operates through departments such as Consumer Products & Interactive Media, Studio Entertainment, Parks & Resorts, and Media Networks. Additionally, the company develops popular theme park attractions and conceptions as well as the resort properties through its Imagineering unit (Voigt et al., 2017). Therefore, this paper will evaluate the internal and external analysis of The Walt Disney Company.
Internal and External Analysis of The Walt Disney Company
The Walt Disney Company is one of the leading companies in the mass media and entertainment industry. The strengths, weaknesses, opportunities, and threats (SWOT) analysis informs managers concerning the external and internal factors which are relevant to the company.
The Walt Disney Corporation’s primary power is the low-cost strategy, experience in business, and its vast resources. Additionally, the firm has created a well-known and reliable brand name for the last two decades (Gamble et al., 2016). Consequently, the corporation has diversified its products and operations to protect against declining sales revenue in commodities. Ultimately, the main internal strengths are financial stability, human resources, employee’s creativity, and effective management of costs through the low cost- strategy.
The main weaknesses of The Walt Disney Company are the high overhead expenditures, frequent changes in the top- management, and large workload for employees. Typically, since its incorporation in the year 1995, The Walt Disney Company has employed over 58,000 workers (Gamble et al., 2016). Nevertheless, this high workforce poses potential communication challenges and top bureaucracy level in the company. Although the firm is making frequent changes, its commercial employees are making the corporate structure to be more difficult to understand (Gamble et al., 2016). Ultimately, The Walt Disney Company experiences high expenses and staff resistance to the heavy workload.
Extrinsic opportunities should be identified, analyzed, and reacted to in early stages. Although The Walt Disney Corporation is facing some risks, the opportunities in this firm outweigh the dangers (Gupta et al., 2016). Moreover, chances comprise of the favorable executive perceptions towards Disney’s activities and restrictions from other firms to enter in the mass media and entertainment industry. Legislative and legal forces are examples of the positive external elements of The Walt Disney Company (Voigt et al., 2017). For instance, the government of France contributed significantly to the Euro Disneyworld proposal in the case of The Walt Disney Corporation by hugely investing in the multi-million projects to develop communication facilities and offered this company a tax relief on the cost of goods sold (Voigt et al., 2017). Ultimately, because the limitations such as substantial capital required to penetrate in the mass media and entertainment sector are still functional, competitors may not find it easy to jeopardize Disney’s diversified product and service mix.
The main dangers to The Walt Disney Corporation are foreign competition, economic and political aspects from the international perspective, and saturated markets. Additionally, as the provision of the goods and services in the media and entertainment sector is starting to saturate the economy, the rivalry will be exciting, and most robust firms will be able to operate (Haile et al., 2016). The Walt Disney Corporation has mitigated the risk because it had globalized and diversified its activities (Haile et al., 2016). Ultimately, the enterprise is working in the service business and may not be in a position to control challenges in its primary operations such as Network-television unit.
The recommendations based on the SWOT analysis of The Walt Disney Company are enhancing the long- term success and business competitiveness in the global market. Therefore, the company’s management must emphasize utilizing its strengths as the central strategic elements for encouraging expansion regardless of the firm’s weaknesses (Voigt, 2017). Further, these approaches must address the effects of the risks by exploiting opportunities on the outside vital elements in the conglomerate’s sectors activities. Therefore, by emphasizing on remarkable aspects in the industry setting, it is suggested that The Walt Disney Corporation should further enter in the developing economies to benefit from their development rates and diversify its portfolio to expand the product scope.
In short, the internal and external elements enumerated in the SWOT evaluation underscore Disney’s potential to continue expanding its portfolio and maintain its leading position in the international market. For instance, the firm’s favorite and reliable brand is the main competitive advantage. Nevertheless, weaknesses present the restrictions on the capacity to expand. Consequently, the company’s limited diversification is an intrinsic strategic factor which prevents recent business projects in high-growth sectors. Furthermore, managers should handle the prudent external factors for expansion in developing economies such as via market penetration to enhance The Walt Disney Company’s economic performance. Lastly, changes in the techniques can execute issues connected to the digital content piracy and competition in the mass media and entertainment industry.
Gamble, J., & Strickland, A. J. (2016). Crafting and executing strategy: The Quest for competitive advantage: Concepts and Cases (20th Ed). New York, NY: McGraw-Hill.
Gupta, G., & Mishra, R. P. (2016). A SWOT analysis of reliability centered maintenance framework. Journal of Quality in Maintenance Engineering, 22(2), 130-145.
Haile, M., & Krupka, J. (2016). Fuzzy evaluation of SWOT analysis. International Journal of Supply Chain Management, 5(3), 172-179.
Voigt, K. I., Buliga, O., & Michl, K. (2017). Making people happy: The Case of the Walt Disney Company. In Business Model Pioneers (pp. 113-126). Springer, Cham.