Page 157 - Harnessing the Management Secrets of Disney in Your Company

138 The Disney Way

assertion is the value that fuels the most productive people and companies in
this country.” And to that, we say amen!

The Sleeping Giant Is Reawakened

When Walt Disney died in 1966, the spirit of adventure with which he had
imbued his company seemed to die with him. For almost two decades, the
company continued to revere the image of its founder, but the old spark
and inspiration were missing. The movies that were made during this time
were lackluster in content and poorly received at the box office. Walt Disney
World, Walt Disney’s brainchild, did open in 1971, but Disneyland in
California installed no new attractions, and the parks were not refurbished.
Moreover, the cost of the EPCOT Center was a huge drain on profits, and
attendance at the park was not living up to expectations.
“What would Walt have done?” became the most frequently heard
question at company headquarters. Some employees said they felt that they
were working for a dead man. Net income dropped 18 percent in 1982 and
slid another 7 percent the following year. The Walt Disney Company, an
American institution, was on a slippery slope, and with its low stock price
reflecting the company’s disarray, it became ripe for takeover by corporate
raiders who were circling like vultures.
Enter Michael Eisner. With the backing of Roy E. Disney, Walt’s neph-
ew and the son of cofounder Roy O. Disney, Eisner came on board in 1984
as chairman and chief executive officer, with Frank Wells assuming the post
of president. Both men won the blessing of the wealthy Bass brothers of Fort
Worth, Texas, who owned a sizable stake in the company. The support of
the Bass family was crucial because it assured the team a significant period of
time in which to rescue the foundering company without interference from
outside investors.
Disney’s legacy was now in the hands of men who understood how to
run the company as Walt had done and how to take calculated risks. It
didn’t take them long to rekindle the magic. New investment in feature-
film animation and a string of live-action hits that reflected the tastes of
contemporary movie-going audiences vaulted the company into the ranks
of major movie studios, a place it had never occupied before. With the
large-scale syndication of Disney’s huge video library, the release of ani-
mated classics on videocassette, expansion and renovation at the theme