Walt Disney (DIS) SWOT Analysis / TOWS Matrix / MBA Resources
Broadcasting & Cable TV
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Walt Disney (Germany)
Based on various researches at Oak Spring University , Walt Disney is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, geopolitical disruptions,
increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Walt Disney can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Walt Disney, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Walt Disney operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Walt Disney can be done for the following purposes –
1. Strategic planning of Walt Disney
2. Improving business portfolio management of Walt Disney
3. Assessing feasibility of the new initiative in Germany
4. Making a Broadcasting & Cable TV sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Walt Disney
Strengths of Walt Disney | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Walt Disney are -
Training and development
– Walt Disney has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Low bargaining power of suppliers
– Suppliers of Walt Disney in the Services sector have low bargaining power. Walt Disney has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Walt Disney to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Walt Disney is present in almost all the verticals within the Broadcasting & Cable TV industry. This has provided Walt Disney a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Digital Transformation in Broadcasting & Cable TV industry
- digital transformation varies from industry to industry. For Walt Disney digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Walt Disney has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Cross disciplinary teams
– Horizontal connected teams at the Walt Disney are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Learning organization
- Walt Disney is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Walt Disney is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Walt Disney emphasize – knowledge, initiative, and innovation.
High brand equity
– Walt Disney has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Walt Disney to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Broadcasting & Cable TV industry
– Walt Disney has clearly differentiated products in the market place. This has enabled Walt Disney to fetch slight price premium compare to the competitors in the Broadcasting & Cable TV industry. The sustainable margins have also helped Walt Disney to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Walt Disney has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Walt Disney staying ahead in the Broadcasting & Cable TV industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Walt Disney in Broadcasting & Cable TV industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Walt Disney is one of the leading players in the Broadcasting & Cable TV industry in Germany. It is in a position to attract the best talent available in Germany. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Walt Disney
– The covid-19 pandemic has put organizational resilience at the centre of everthing Walt Disney does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of Walt Disney | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Walt Disney are -
Need for greater diversity
– Walt Disney has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Products dominated business model
– Even though Walt Disney has some of the most successful models in the Broadcasting & Cable TV industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Walt Disney should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Walt Disney is one of the leading players in the Broadcasting & Cable TV industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Broadcasting & Cable TV industry in last five years.
Aligning sales with marketing
– From the outside it seems that Walt Disney needs to have more collaboration between its sales team and marketing team. Sales professionals in the Broadcasting & Cable TV industry have deep experience in developing customer relationships. Marketing department at Walt Disney can leverage the sales team experience to cultivate customer relationships as Walt Disney is planning to shift buying processes online.
Skills based hiring in Broadcasting & Cable TV industry
– The stress on hiring functional specialists at Walt Disney has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High dependence on Walt Disney ‘s star products
– The top 2 products and services of Walt Disney still accounts for major business revenue. This dependence on star products in Broadcasting & Cable TV industry has resulted into insufficient focus on developing new products, even though Walt Disney has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the Broadcasting & Cable TV industry, Walt Disney needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Walt Disney is slow explore the new channels of communication. These new channels of communication can help Walt Disney to provide better information regarding Broadcasting & Cable TV products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee of Walt Disney is just above the Broadcasting & Cable TV industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High cash cycle compare to competitors
Walt Disney has a high cash cycle compare to other players in the Broadcasting & Cable TV industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Walt Disney has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Broadcasting & Cable TV industry using digital technology.
Walt Disney Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Walt Disney are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Walt Disney can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Broadcasting & Cable TV industry, but it has also influenced the consumer preferences. Walt Disney can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Walt Disney can improve the customer journey of consumers in the Broadcasting & Cable TV industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Walt Disney to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Walt Disney can use these opportunities to build new business models that can help the communities that Walt Disney operates in. Secondly it can use opportunities from government spending in Broadcasting & Cable TV sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Walt Disney is facing challenges because of the dominance of functional experts in the organization. Walt Disney can utilize new technology in the field of Broadcasting & Cable TV industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Walt Disney can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Broadcasting & Cable TV industry.
Leveraging digital technologies
– Walt Disney can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Better consumer reach
– The expansion of the 5G network will help Walt Disney to increase its market reach. Walt Disney will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Walt Disney to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Walt Disney to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Walt Disney has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Broadcasting & Cable TV sector. This continuous investment in analytics has enabled Walt Disney to build a competitive advantage using analytics. The analytics driven competitive advantage can help Walt Disney to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Walt Disney has opened avenues for new revenue streams for the organization in Broadcasting & Cable TV industry. This can help Walt Disney to build a more holistic ecosystem for Walt Disney products in the Broadcasting & Cable TV industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Walt Disney can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Walt Disney to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Walt Disney External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Walt Disney are -
Easy access to finance
– Easy access to finance in Broadcasting & Cable TV industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Walt Disney can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Walt Disney may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Broadcasting & Cable TV sector.
Consumer confidence and its impact on Walt Disney demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Broadcasting & Cable TV industry and other sectors.
Increasing wage structure of Walt Disney
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Walt Disney.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Walt Disney.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Broadcasting & Cable TV industry are lowering. It can presents Walt Disney with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Broadcasting & Cable TV sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Walt Disney in Broadcasting & Cable TV industry. The Broadcasting & Cable TV industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Walt Disney in the Broadcasting & Cable TV sector and impact the bottomline of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Walt Disney will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Walt Disney needs to understand the core reasons impacting the Broadcasting & Cable TV industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Walt Disney can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Broadcasting & Cable TV industry.
Technology acceleration in Forth Industrial Revolution
– Walt Disney has witnessed rapid integration of technology during Covid-19 in the Broadcasting & Cable TV industry. As one of the leading players in the industry, Walt Disney needs to keep up with the evolution of technology in the Broadcasting & Cable TV sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of Walt Disney Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Walt Disney needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Walt Disney is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Walt Disney is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Walt Disney to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Walt Disney needs to make to build a sustainable competitive advantage.
