Page 224 - Harnessing the Management Secrets of Disney in Your Company

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never built a splendidly pompous, ego-enhancing headquarters building, nor
did he ever spend a nickel on advertising his theme park. Disney reasoned
that his television shows provided advertising aplenty, so why waste money
paying for it? In today’s environment, The Walt Disney Company has a large
advertising budget, but still does not waste money on backstage areas.
Walt also kept a sharp eye on financial arrangements and partnerships,
not hesitating to protect his own interests. Although a licensing deal in the
early 1930s brought in $300,000 the first year—with Walt’s share provid-
ing half of the company’s annual profits that year—he quickly discovered a
major drawback. The deal called for his percentage of the profits to increase
as more items were sold, but since novelty items sold fast and then faded
from the market, the licensee would make a lot more money than Disney
would. Walt canceled the arrangement and set up an in-house marketing
division.
Today, Disney executives ask cast members to balance what they call
“quality cast experience,” “quality guest experience,” and “quality business
practice.” The product should deliver value in all three areas: pleasing cast
members, customers, and corporate bean counters and balancing them as
needed. The company firmly believes, as Walt did, that obsessive attention
to detail in all respects is the key to delivering a sterling experience that will
keep guests coming back while holding costs to a level that still maintains
profit margins.
In our experience, successful companies like Disney balance business and
creative needs by insisting on strict adherence to a set of core values, emphasiz-
ing the importance of details in exceeding customer expectations, and encour-
aging innovation and risk taking within a specified set of boundaries. Disney
makes no bones about its belief that creativity works best within a specified
framework. In a 1996 interview with Fortune magazine, Peter Schneider,
75
president of the film division, called deadlines “a key ingredient to creativity.”
They force people to focus on the project at hand, to produce something—
good, bad, or indifferent—that will at least serve to spark the next idea, he said.
And, of course, deadlines also keep costs from spiraling out of control.
Many of the companies we advise have devised winning strategies that
similarly balance top-of-the-line quality with innovation and bottom-line
performance.
John Dunn’s hotel properties consistently rank at the top in opinion
polls because of his insistence on quality and attention to detail. Employees