Up Close and Personal with Disney's CEO
<CITE>by Jim Citrin</CITE> Utility Links
Wednesday, March 1, 2006
It has been six months since Robert A. "Bob" Iger officially took over as president and chief executive officer of The Walt Disney Company (DIS). On Oct. 1, 2005, following one of the most high-profile CEO searches in history, Bob succeeded Michael Eisner, who had led the company for 21 years.
And what a half-year it has been. While many people in the media and entertainment industry and on Wall Street had long viewed Bob as the calm, likable, steady No. 2, he has quickly shown that he's very much his own man, with a decisive and effective leadership style that gets things done. He moved immediately to resolve the company's rancorous battle with shareholders Roy Disney and Stanley Gold, surprised the world by being the first entertainment company to provide content to Apple's video iPod, and solved the Pixar-Disney distribution impasse by engineering a deal to acquire the company. These steps show Bob's deftness in seeing and seizing the opportunities to solve big problems and achieve big wins.
<TABLE cellSpacing=0 cellPadding=8 width=190 align=right bgColor=#d9e4f8 border=1><TBODY><TR><TD>BACKGROUND INFO ON BOB IGER
From January, 2000, until he became CEO, Bob served as Disney's president and chief operating officer, with responsibility for all aspects of the company's worldwide operations. He oversaw the resurgence of the ABC Television Network, the international expansion of the company's consumer products division, the growth of Disney Channel, ESPN, and other cable properties, the company's rapidly growing Internet and mobile technology businesses, Hong Kong Disneyland's opening, and Disneyland's worldwide 50th anniversary celebration.
Bob joined Disney in 1996 when it acquired Capital Cities/ABC, where he had been president and chief operating officer. Bob began his career with ABC in 1974 as a studio supervisor, and during his 22 years with the company, he experienced virtually every aspect of the TV network business, including news, sports, and entertainment, as well as TV's business side, such as program acquisition, rights negotiations, and business affairs.
Bob was born Feb. 10, 1951, and grew up in Oceanside, N.Y. His father, a professional jazz trumpet player, had a career in advertising and publishing and later taught marketing at New York Institute of Technology. Bob's first broadcasting experience was as a weatherman in Ithaca, N.Y. The major lesson from that experience? Bob says, "That's where I learned how to give people bad news."
</TD></TR></TBODY></TABLE>Bob recently spent time discussing with me his early tenure as CEO, Disney's strategy, and the Pixar deal's impact as the first protagonist for "Leadership by Example". A highly energetic and fit person, Bob gets up at 4:30 a.m. every day to work out. His leadership style is grounded in developing a focused strategy, achieving buy-in from his team, and working exceptionally well with others inside and outside the company.
Following are excerpts from our discussion:
As you look back on the time since Oct. 1, what are you most proud of?
Nothing is a more important accomplishment than Pixar, so I'd have to say that's what I'm most proud of. Beyond that, I'm proud that we have a senior management team that has really gelled and that has agreed to and is implementing a set of strategic priorities and is pushing them across the organization. Almost everything we do is informed by those priorities. But Pixar would be the most important. I don't want to call it the crowning moment because, hopefully, there will be many more, but it's definitely a highlight so far.
What's the back story on Pixar? How did you pull off the deal so quickly and quietly?
It was a conversation that started as a standard negotiation to extend a distribution relationship, [which then] morphed into a discussion about the acquisition. This was something that I first raised with Steve [Jobs, Pixar's chairman and CEO,] in late September/early October.
We ended up pursuing a three-pronged approach: First was to determine whether Pixar was a willing seller. Second was to set up the rationale for the Disney board. And third was to do all the appropriate analysis to make sure the economic and strategic value lined up and made sense. We pulled it off in a highly collaborative effort.
It took an enormous amount of work, but we were extremely deliberate about it, including the manner in which it was discussed at the board level. We took this up over multiple board meetings, at both regularly scheduled and special meetings. We spent an enormous amount of time on the subject for all the obvious reasons.
How do you feel about the $7.4 billion price that you paid?
Yes, it was $7.4 billion, but they had $1 billion in cash, so it nets down to $6.4 billion. We're comfortable with the analysis we've done and that the strategic and economic value will pay off in the long-term for Disney shareholders.
We're looking at Pixar in terms of the long-term impact it will have on the company in three ways: One, the value of owning 100 percent of Pixar's films going forward. Two, the value of Pixar making the sequels to the films that have already been made. And three, the improvement we believe we'll realize from their management team leading Disney Animation.
The real value will be in the quality and ultimate success of Animation under the new company, Disney and Pixar. That's really where the value is to be created. The justification for doing the deal is mostly in that direction. Clearly talent is a critical component of that. We wouldn't be expecting success in Animation in those three directions without the talent that Pixar has amassed over time -- and without the ability to keep that talent at Disney.
How are you planning to maintain the unique Pixar culture, where the animators, technologists, and storytellers all sit together and create?
Well, we're perfectly confident that we'll be able to keep the Pixar culture. If anything, we're going to have the Pixar culture influence the Disney Animation culture. We're not going to turn Disney into a carbon copy of Pixar, but we're going to let Pixar be free to create and lead. At Disney Animation, we're going to focus on stories and characters, not on genre or platform. The goal is to create great stories and characters.
What do you make of those who say you've let the fox into the hen house with Steve Jobs coming onto the Disney board?
I'm thoroughly dismissive of that. Steve is incredibly bright, he has great perspective. He's passionate, knowledgeable, smart, and has exceptional sensitivities and expertise -- he's the complete package. We have spoken at great length about his goals and intentions. I see eye to eye with Steve. He will be a major asset to the board and the company.
What's your view on activist shareholders? Are they becoming too powerful?
Activist shareholders that know what they're talking about are to be respected, listened to, and worked with. On the other hand, I have no respect for so-called activist shareholders who come into the stock, try to hold up a company to achieve short-term gains, and then immediately bail out at a profit. What boards have to do is weed out the criticisms made by short-term profiteers with shallow motives from the criticisms that are valid and should be addressed.
What type of feedback have you been getting from your largest shareholders?
Shareholders typically vote with their wallet. Over the last six months, Disney's stock has been stable in a market that has been difficult for media and entertainment stocks.
By and large, the feedback is extremely positive. They're pleased that we're very focused strategically. They see it as a positive that the company has dealt with a couple of difficult issues. They see Pixar as having a powerful strategic fit. Some questioned the deal economically, but for the most part, they've given it high marks. In fact, when the deal was announced, the Disney stock price went up, which is rare for an acquisition that's initially dilutive. So we were very pleased with that.
Our shareholders like the fact that we talk about following the consumer wherever they go and however they enjoy entertainment. They like the deal we did with Apple on the video iPod, they like the fact that we're one of the world's largest providers of wireless content. And finally they have said that they like the fact that we have a strong and stable management team.
Let's review your strategic agenda for Disney. You've focused the company on three strategic priorities:
I would give us an "A" for content. "Grey's Anatomy", "Desperate Housewives" and "Lost" on ABC; ESPN and Disney Channel on cable; and "The Chronicles of Narnia", "Cars", and "Pirates of the Caribbean" in motion pictures. We're producing and will continue to create excellent creative content.
I would also give us an "A" for technology. We've used technology to enhance the quality of the product, such as ABC and ESPN in high definition, the video iPod deal, our wireless businesses, including Mobile ESPN and Disney Mobile, for example. We're also using technology to improve the development of our products, such as in animation and digital and physical attractions in our theme parks.
On our globalization priority, I'd give us a "B" so far. We've done some very good things, but we have a lot more to do. We've opened Hong Kong Disneyland.
We're launching an original version of "Desperate Housewives" in Latin America, where we're not just translating existing episodes, we're producing the show with local actors and original stories in local language. This has been met with great response so far. ESPN has been producing local content tailored to different interests and tastes around the world for a long time. But the world is a big place, and there's so much more we can do over time.
How are you enjoying being CEO?
Disney is a very special place, and as CEO I have to be the steward of the brand, which is extremely special. I really like the role of CEO and appreciate the opportunity to lead. It's a huge responsibility, though. There's a constancy to the job given all of the things that we're doing and need to keep focused on, and given that we operate around the clock and around the world.
What advice do you have for those who aspire to leadership roles in media and entertainment?
I would advise people to try and join a quality company, with quality people. You want to get on a train that's heading in the right direction, headed by the right people, and that's operating well. I believe that it's generally a better path to join a quality company, work hard and well with people, and navigate your way into the right roles than to join a lower quality company, even if you start in a more senior position.
<TABLE cellSpacing=0 cellPadding=8 width=390 border=1><TBODY><TR><TD bgColor=#d9e4f8>Three Leadership Lessons from Disney's Bob Iger
the entire article:
http://finance.yahoo.com/columnist/article/leadership/2759
<CITE>by Jim Citrin</CITE> Utility Links
Wednesday, March 1, 2006
It has been six months since Robert A. "Bob" Iger officially took over as president and chief executive officer of The Walt Disney Company (DIS). On Oct. 1, 2005, following one of the most high-profile CEO searches in history, Bob succeeded Michael Eisner, who had led the company for 21 years.
And what a half-year it has been. While many people in the media and entertainment industry and on Wall Street had long viewed Bob as the calm, likable, steady No. 2, he has quickly shown that he's very much his own man, with a decisive and effective leadership style that gets things done. He moved immediately to resolve the company's rancorous battle with shareholders Roy Disney and Stanley Gold, surprised the world by being the first entertainment company to provide content to Apple's video iPod, and solved the Pixar-Disney distribution impasse by engineering a deal to acquire the company. These steps show Bob's deftness in seeing and seizing the opportunities to solve big problems and achieve big wins.
<TABLE cellSpacing=0 cellPadding=8 width=190 align=right bgColor=#d9e4f8 border=1><TBODY><TR><TD>BACKGROUND INFO ON BOB IGER
From January, 2000, until he became CEO, Bob served as Disney's president and chief operating officer, with responsibility for all aspects of the company's worldwide operations. He oversaw the resurgence of the ABC Television Network, the international expansion of the company's consumer products division, the growth of Disney Channel, ESPN, and other cable properties, the company's rapidly growing Internet and mobile technology businesses, Hong Kong Disneyland's opening, and Disneyland's worldwide 50th anniversary celebration.
Bob joined Disney in 1996 when it acquired Capital Cities/ABC, where he had been president and chief operating officer. Bob began his career with ABC in 1974 as a studio supervisor, and during his 22 years with the company, he experienced virtually every aspect of the TV network business, including news, sports, and entertainment, as well as TV's business side, such as program acquisition, rights negotiations, and business affairs.
Bob was born Feb. 10, 1951, and grew up in Oceanside, N.Y. His father, a professional jazz trumpet player, had a career in advertising and publishing and later taught marketing at New York Institute of Technology. Bob's first broadcasting experience was as a weatherman in Ithaca, N.Y. The major lesson from that experience? Bob says, "That's where I learned how to give people bad news."
</TD></TR></TBODY></TABLE>Bob recently spent time discussing with me his early tenure as CEO, Disney's strategy, and the Pixar deal's impact as the first protagonist for "Leadership by Example". A highly energetic and fit person, Bob gets up at 4:30 a.m. every day to work out. His leadership style is grounded in developing a focused strategy, achieving buy-in from his team, and working exceptionally well with others inside and outside the company.
Following are excerpts from our discussion:
As you look back on the time since Oct. 1, what are you most proud of?
Nothing is a more important accomplishment than Pixar, so I'd have to say that's what I'm most proud of. Beyond that, I'm proud that we have a senior management team that has really gelled and that has agreed to and is implementing a set of strategic priorities and is pushing them across the organization. Almost everything we do is informed by those priorities. But Pixar would be the most important. I don't want to call it the crowning moment because, hopefully, there will be many more, but it's definitely a highlight so far.
What's the back story on Pixar? How did you pull off the deal so quickly and quietly?
It was a conversation that started as a standard negotiation to extend a distribution relationship, [which then] morphed into a discussion about the acquisition. This was something that I first raised with Steve [Jobs, Pixar's chairman and CEO,] in late September/early October.
We ended up pursuing a three-pronged approach: First was to determine whether Pixar was a willing seller. Second was to set up the rationale for the Disney board. And third was to do all the appropriate analysis to make sure the economic and strategic value lined up and made sense. We pulled it off in a highly collaborative effort.
It took an enormous amount of work, but we were extremely deliberate about it, including the manner in which it was discussed at the board level. We took this up over multiple board meetings, at both regularly scheduled and special meetings. We spent an enormous amount of time on the subject for all the obvious reasons.
How do you feel about the $7.4 billion price that you paid?
Yes, it was $7.4 billion, but they had $1 billion in cash, so it nets down to $6.4 billion. We're comfortable with the analysis we've done and that the strategic and economic value will pay off in the long-term for Disney shareholders.
We're looking at Pixar in terms of the long-term impact it will have on the company in three ways: One, the value of owning 100 percent of Pixar's films going forward. Two, the value of Pixar making the sequels to the films that have already been made. And three, the improvement we believe we'll realize from their management team leading Disney Animation.
The real value will be in the quality and ultimate success of Animation under the new company, Disney and Pixar. That's really where the value is to be created. The justification for doing the deal is mostly in that direction. Clearly talent is a critical component of that. We wouldn't be expecting success in Animation in those three directions without the talent that Pixar has amassed over time -- and without the ability to keep that talent at Disney.
How are you planning to maintain the unique Pixar culture, where the animators, technologists, and storytellers all sit together and create?
Well, we're perfectly confident that we'll be able to keep the Pixar culture. If anything, we're going to have the Pixar culture influence the Disney Animation culture. We're not going to turn Disney into a carbon copy of Pixar, but we're going to let Pixar be free to create and lead. At Disney Animation, we're going to focus on stories and characters, not on genre or platform. The goal is to create great stories and characters.
What do you make of those who say you've let the fox into the hen house with Steve Jobs coming onto the Disney board?
I'm thoroughly dismissive of that. Steve is incredibly bright, he has great perspective. He's passionate, knowledgeable, smart, and has exceptional sensitivities and expertise -- he's the complete package. We have spoken at great length about his goals and intentions. I see eye to eye with Steve. He will be a major asset to the board and the company.
What's your view on activist shareholders? Are they becoming too powerful?
Activist shareholders that know what they're talking about are to be respected, listened to, and worked with. On the other hand, I have no respect for so-called activist shareholders who come into the stock, try to hold up a company to achieve short-term gains, and then immediately bail out at a profit. What boards have to do is weed out the criticisms made by short-term profiteers with shallow motives from the criticisms that are valid and should be addressed.
What type of feedback have you been getting from your largest shareholders?
Shareholders typically vote with their wallet. Over the last six months, Disney's stock has been stable in a market that has been difficult for media and entertainment stocks.
By and large, the feedback is extremely positive. They're pleased that we're very focused strategically. They see it as a positive that the company has dealt with a couple of difficult issues. They see Pixar as having a powerful strategic fit. Some questioned the deal economically, but for the most part, they've given it high marks. In fact, when the deal was announced, the Disney stock price went up, which is rare for an acquisition that's initially dilutive. So we were very pleased with that.
Our shareholders like the fact that we talk about following the consumer wherever they go and however they enjoy entertainment. They like the deal we did with Apple on the video iPod, they like the fact that we're one of the world's largest providers of wireless content. And finally they have said that they like the fact that we have a strong and stable management team.
Let's review your strategic agenda for Disney. You've focused the company on three strategic priorities:
- Creating great content
- Applying technology in the creation and distribution of your businesses
- Growing internationally, in terms of both expanding Disney's businesses around the world and changing the notion that Burbank has a monopoly on creativity.
I would give us an "A" for content. "Grey's Anatomy", "Desperate Housewives" and "Lost" on ABC; ESPN and Disney Channel on cable; and "The Chronicles of Narnia", "Cars", and "Pirates of the Caribbean" in motion pictures. We're producing and will continue to create excellent creative content.
I would also give us an "A" for technology. We've used technology to enhance the quality of the product, such as ABC and ESPN in high definition, the video iPod deal, our wireless businesses, including Mobile ESPN and Disney Mobile, for example. We're also using technology to improve the development of our products, such as in animation and digital and physical attractions in our theme parks.
On our globalization priority, I'd give us a "B" so far. We've done some very good things, but we have a lot more to do. We've opened Hong Kong Disneyland.
We're launching an original version of "Desperate Housewives" in Latin America, where we're not just translating existing episodes, we're producing the show with local actors and original stories in local language. This has been met with great response so far. ESPN has been producing local content tailored to different interests and tastes around the world for a long time. But the world is a big place, and there's so much more we can do over time.
How are you enjoying being CEO?
Disney is a very special place, and as CEO I have to be the steward of the brand, which is extremely special. I really like the role of CEO and appreciate the opportunity to lead. It's a huge responsibility, though. There's a constancy to the job given all of the things that we're doing and need to keep focused on, and given that we operate around the clock and around the world.
What advice do you have for those who aspire to leadership roles in media and entertainment?
I would advise people to try and join a quality company, with quality people. You want to get on a train that's heading in the right direction, headed by the right people, and that's operating well. I believe that it's generally a better path to join a quality company, work hard and well with people, and navigate your way into the right roles than to join a lower quality company, even if you start in a more senior position.
<TABLE cellSpacing=0 cellPadding=8 width=390 border=1><TBODY><TR><TD bgColor=#d9e4f8>Three Leadership Lessons from Disney's Bob Iger
- Set a crystal-clear strategic agenda with three to four priorities, and drive everything from these priorities.
- On major strategic initiatives, be very deliberate and analytical in developing and communicating the strategic and economic rationale.
- Lead by example, be a great listener, and treat others with care and respect. That's the way to set the tone for the organization and culture.
the entire article:
http://finance.yahoo.com/columnist/article/leadership/2759
