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Re-Creating the Magic 219

Jeffery Katzenberg saga is a prime example. Jeffery had been Eisner’s protégé
at Paramount and followed Eisner to Disney to head up the film entertain-
ment division. Katzenberg wanted to be the company savior and replace the
beloved Wells. One might reasonably chastise Jeffery for his inappropriate
timing and total lack of respect for the late president. It is reported that he
barged into Eisner’s office on the very day of Wells’ funeral and demanded
to be named as his successor. Eisner claimed that Jeffery was not the right
fit for the job, despite his apparent savvy in running a major portion of the
business and launching one of Disney’s biggest hits of all time, The Lion King.
The outraged Jeffery promptly exited the Disney organization, hauling it
into court and forcing it to fork out hundreds of millions in unpaid bonuses
due him from The Lion King. (By the way, Katzenberg appears to be doing
just fine running DreamWorks SKG.)
We believe the seeds of Eisner’s paranoia were really planted at Paramount.
(Who knows when it really began? Maybe he felt rejected being sent off to
camp every summer.) In 1976, Michael became president of Paramount and
aspired to be named CEO when his friend and mentor Barry Diller left the
position to run Twentieth Century Fox. However, Paramount’s parent com-
pany, Gulf & Western, had other plans for Eisner. They said he would never
be CEO of Paramount because he is too “child-like.” In 1984, Michael was
terminated and went to the company that could best utilize the talents of a
“child-like” executive: Disney.
But Michael’s paranoia continued at Disney. The seeds were fertilized dur-
ing his initial negotiations with the company. The Bass family, one of Disney’s
largest investors, wanted Frank Wells to be CEO and Eisner to be president.
Eisner argued that the top spot should be a creative type like himself, not the
typical numbers type like Wells. Much to Michael’s surprise, Frank agreed,
and the two of them convinced the board of directors as well as the Bass fam-
ily that this decision would be best for Disney. But there was one important
detail that is overlooked by many. The board insisted that, as president, Frank
report directly to the board rather than to Eisner. In many respects, Frank
and Michael were true partners much like Walt and Roy were in their years
together. Even though Michael’s public persona was that of “top dog,” in his
heart he knew he was really sharing control of Disney with Frank.
Not only was Eisner envious of Wells’s coleadership position, but one
could make the point that Michael was also envious of Frank’s business and
financial acumen. Frank was a former entertainment lawyer and a Rhodes