Related diversification and unrelated diversification

Assignment Help Other Subject
Reference no: EM132970

QUESTION

One plus one can equal more than two when firms leverage core competencies and share activities. Disney is a prime example. Chairman and CEO Michael Eisner credited Disney's success to several factors. Among these, diversity leads the list. Eisner attributed the company's creativity to the diversity of ideas generated by its employees. Although diversity of opinion can cause friction, this "creative friction" is the foundation of Disney's idea generation success

The company harnesses this creative friction through synergies among business units. For example, Disney recently reorganised its structure from a hierarchical to a hybrid form. With the hierarchical structure, an employee writing a movie in Italy would report directly to the movie division. But this keeps the knowledge gained from the Italian movie production within the movie production division. So now the Italian movie producer reports to someone outside the movie division in addition to the producer's own work unit. This gives others access to information that would otherwise remain isolated, creating the chance that knowledge gained in one division can be used elsewhere. In other words, Disney arranges "chance accidents" in which synergies can develop and duplication of efforts can decrease

Disney also has expertise in sharing activities. Consider the box office hit The Lion King. Disney was not satisfied to sit back and collect the box office revenues. After the movie's success, it developed more than 150 different Lion King products. Disney based the soundtrack, Rhythm of the Pride Lands, on the music from The Lion King. Simba's Pride is a video spawned from The Lion King. By leveraging The Lion King's success and sharing activities among different business divisions. Disney turned a $600 million movie success into a $3 billion revenue stream. Other examples abound at Disney. Disney World works with a cruise line to sell joint vacations. The little Mermaid became a popular television production. Toy Story was leveraged with a video game based on the movie's animated characters. A successful Broadway play was the result of Beauty and the Beast. EuroDisney managers share their knowledge and expertise with Disney's other resort managers

The result? Three movie studios; theme parks in the United States, France, and Japan and a future development in Hong Kong; two Disney cruise ships in addition to joint efforts with other cruise lines; 725 Disney stores; and ownership of major media outlets including ABC, ESPN, Lifetime, and E! Entertainment Television. With $25 billion in annual revenues, Disney is an exemplar of benefits of leveraging core competencies and sharing activities

Required-

(a) Discuss how managers of Disney have created value for the firm through diversification efforts

(b) Using appropriate examples explain how other companies can benefit from: (i) related diversification and (ii) Unrelated diversification?

(c) (i) It is critical for a firm to attain congruence between its strategy and organisational structure'. Discuss the benefits which Disney has achieved by reorganising its structure from a hierarchical to a hybrid one

(ii) Identify the different departmentalisation approaches to organisation structure, and discuss their relative advantages and disadvantages

Reference no: EM132970

Questions Cloud

What technologies are used in windows server 2008 : What technologies are used in windows server 2008
Check a governmental and a not-for-profit program : Check a governmental and a not-for-profit program
What would the tax rate need to be in year : What would the tax rate need to be in Year 2 to make the taxpayer indifferent?
Predicate color and action paint using situation calculus : Predicate color and action paint using situation calculus
Related diversification and unrelated diversification : Using appropriate examples explain how other companies can benefit from: (i) related diversification and (ii) Unrelated diversification
Determine the cost of goods manufactured for february : Determine the cost of goods manufactured for February.
Detail advantages of looping : Detail advantages of looping
What could be your response to the ceo : What could be your response to the CEO
Produce a book class that stores book information : Produce a Book class that stores book information

Reviews

Write a Review

 

Other Subject Questions & Answers

  What is the air concentration relative to the osha pel

What is the requirement before the use of the sampling pump, Give three ways how it can be achieved What is the air concentration relative to the OSHA PEL, Express your answer in ppm List down five requirements of a sample train check list

  Examine the empirical status of constitutional norms

Discuss the essence of Arbitration as a substitute to litigations Examine the empirical status of Constitutional norms in Mauritius

  Four steps for performing a job safety analysis

Elaborate and illustrate the four steps for performing a Job Safety Analysis/Job Hazard Analysis Safe systems of work are of paramount importance in accident prevention and should fully identify and document all the hazards, safety precautions a..

  Explain international organisation of securities commission

Write short notes on the following: (a) International Organisation of Securities Commission (IOSCO) (b) International Association of Insurance Supervisors (IAIS)

  What do sociologists study

What do sociologists study. Identify some of the things they study and the ways they study them

  The key benefits and challenges for a contracting authority

The key benefits and challenges for a contracting authority

  Analyzing a case study - a swot analysis

Detailed analysis of a case study should include eight areas The history, development, and growth of the company over time

  Describe the principles of dilution ventilation

Describe the principles of Dilution Ventilation and Local Exhaust Ventilation

  Cyber troll case study

Case Study - THE CYBER TROLL

  Different principles associated with scientific management

What difficulties might confront a manager today if he tries to implement Taylor's view of management as they were originally stated? • Explain scientific management and the different principles associated with scientific management

  Differences and similarities between futures and forwards

What are the differences and similarities between futures and forwards. Distinguish between exchange traded instruments and over the counter instruments

  What is the importance of customer care

Customer care is at the heart of any successful service organization. What is the importance of customer care? Integrated Marketing Communications is a term used to describe a holistic approach to marketing. It aims to ensure consistency of mess..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd