Chapter 16: Organizational Culture

According to the Disney Institute, the company approaches the development of their culture as four interconnected processes: employee selection, training, care, and communication. Disney is a company that is well known for its strong organizational culture, so it is important that they continue to foster their organizational values and beliefs.

In the first step, employee selections, managers make sure not to hire employees based purely on their skills and abilities. New hires must have similar values to the company. If an employee’s values greatly differ from those of the Disney Company, they will never fully be a part of the company and will therefore hinder Disney’s mission.

The second step is employee training. The training and orientation process must reflect the values and culture of the company and instill those values in the new employees. The Disney Institute states, “the way you train your employees is a reflection of your culture,” and the company displays this belief with every new hire. Training and orientation is the first step of an employees entry into the organizational culture, or anticipatory socialization. It is important that the first impression an employee has of the company is the right one.

The third and fourth steps are care and communication. The Disney Institute states, “To continually foster a healthy culture, you must genuinely care for your workforce and find ways to express it.” This step requires employee engagement programs and clear communication channels. This is furthered with Disney’s belief in organizational support. Managers are seen as cheerleaders for their employees, which fosters the organization’s culture of risk and creativity.

Chapter 14: Job Design & Alternative Work Arrangements

The Walt Disney Company has been known to promote flexible working hours for its employees. In fact, Disney has been named #9 on Forbes’ “Top Best Big Companies for Work-Life Balance” This practice fits in nicely with the company’s organizational strategy, of which a major goal is to maintain happy, satisfied employees. Disney has maintained and even fostered high levels of creativity and productivity with their flexible hours and telecommuting. Disney’s success with employee satisfaction also related to the Hackman-Oldham Job Characteristics Model. A survey done by the Walt Disney Company shows that most employees have experience skill variety, task identity, and task significance. The study showed that 80% of employees find their job challenging and interesting, 77% understand how their job fits with the goals and strategies of their business segment, and 90% understand the role they can play in helping Disney to be a responsible company. Overall, the Disney Company uses job design and alternative work scheduling to ensure happy, healthy, productive employees.

Chapter 13: Conflict

The main source of conflict for the Walt Disney Company in recent years has been inter-organizational conflict caused by the former CEO, Michael Eisner. Eisner had a disagreeable personality and lacked conflict management skills.

The Walt Disney Company experienced inter-organizational and interpersonal conflict in the early 2000s when former CEO Michael Eisner and Steve Jobs clashed. The two CEOs did not get along, mainly due to major differences in their personalities and perceptions of the merger between Disney and Pixar. This was a highly dysfunctional conflict that almost lead to the end of the Disney-Pixar contract, but the executive board decided that Mike Eisner’s unfavorable personality was a leading reason for the conflict just in time. This, along with his failing performance, lead them to institute a personnel change and fire Eisner. Where Eisner took a competing approach to conflict management and fixated on what  he thought was right, his replacement did the exact opposite. The next and current CEO of the Walt Disney Company is Bob Iger, who immediately took a highly collaborative stance with Steve Jobs and Pixar and saved the relationship between the two companies.

 

Chapter 12: Leadership

Currently, the most formal leadership within the Walt Disney Company is held by the chairman and CEO Robert A. Iger. He and other top executives practice a transformational leadership style, in which they “inspire and excite [employees] to high levels of performance.” (Nelson & Quick) Iger empowers and challenges employees to work at the height of their imagination and pursue even the wildest of ideas, and has continued to grow an environment in which risks are acceptable and encouraged. This transformational leadership style was instilled in the company by Walt Disney himself, and every CEO since has continued this strategy. This leadership style is very important to the company, because it relies heavily on the innovation and creativity of each and every employee.

Path-Goal theory can also be applied to Robert A. Iger’s leadership style. The theory states that a leader’s job is to clear the way for their employees to achieve their goals. A leader does this by knowing when to employ any of four different leadership styles: supportive, participative, achievement oriented, and directive. Robert Iger certainly employs this strategy.He knows to be supportive and take a step back when his employees are running with an idea. If an employee is struggling with creativity or risk taking, Iger becomes participative and provides a welcoming learning environment where employees can grow. Overall, Iger has been a great leader for the Walt Disney Company. His leadership style, and that of those before him, is the reason why the company has been so successful and has been instilled in the lives of so many people around the world. Through his transformational leadership style, Iger encourages creativity and innovation in his employees through support and empowerment, which is exactly what the company needs to continue to be and entertainment powerhouse and brighten people’s lives.

Chapter 11: Power

Different executives within the Walt Disney Company have had many different types of power throughout the history of the company. One of the most effective types of power is referent power, which is “an elusive power that is based on interpersonal attraction. This type of power was exhibited by Walt Disney’s direct descendants when they still worked for the company. Roy O. Disney served as an executive and on the board of directors until the early 2000’s, and his opinion had a lot of draw in the company. For example, during the controversy surrounding former CEO, Michael Eisner, Roy Disney’s support, or lack thereof, was a major factor in the encouragement of his resignation. As a matter of fact, Eisner lost his position because he displayed attributes of powerlessness and tried to exert power outside the zone of indifference. Eisner showed signs of assumed powerlessness when he ordered all decisions in the company to go through him and overly supervised his employees. This inhibit creativity and empowerment, which resulted in major losses for the company. Eisner tried to exert power outside of his influence when it came to other executives, particularly Steve Jobs, who was the CEO of Pixar at the time. Eisner tried to exert power over Jobs that he didn’t have, which resulted in an extremely negative relationship between the two. Their indifference got so bad that Jobs threatened to drop Pixar’s contract with Disney, and this was the last straw. Michael Eisner’s inability to properly use his power resulted in his resignation as CEO of the Walt Disney Company.

Chapter 10: Creativity

In the current market, with innovation running at the speed of light, is is essential that employee creativity is encouraged and developed. According to the Disney Institute, Disney sees creativity as “the collective expression, analysis and implementation of new ideas.” These ideas can come from anyone, anywhere in the company, so Disney does a lot to ensure employees are creatively fueled.

For one, top executives and manager always have their ears open for creative ideas. They try not to dismiss ideas that are heard in passing or without strategic context, because they believe that the next great character or movie that Disney develops could come from anywhere. Another way Disney fosters creativity is through Creative Lab, which is a digital community for cast members where they can share “buzz”. This buss can be ideas about anything related to the company, such as new rides, movies, characters, experiences, etc.  Throughout each month, cast members vote on ideas. Then, the top ideas for the month are presented for the entire company to see – even legal and financial executives.This program keeps creativity flowing among employees and can lead to some really innovative ideas. Employees are encouraged, if they are truly inspired by an idea on Creative Lab, to take the idea a step further to the physical creativity lab where it can start the process to potentially become a reality.

 

Chapter 9: Teams

The Walt Disney Company has many business units, all with their own approach to teamwork. At theme parks employees are given objectives, but are not told how to reach those objectives. As a result, employees become members of self-managing teams who must work together to accomplish their goal. This self-management increases empowerment, which decreases turnover and absenteeism and increases job satisfaction. The company also ensures diversity in teams – not just cross-cultural, but cross-functional as well. At Disney theme parks, front line cast members are put into teams with behind-the-scenes employees to ensure that a multitude of viewpoints and ideas are considered.

According to the Disney Institute, the maintenance functions of a team are just as important as the task functions, and teams who don’t effectively carry out maintenance functions usually fail. They encourage peer-to-peer care through:

• Creating a healthy interdependence between coworkers
• Building and nurturing authentic relationships that tend not to be perceived as part of some other organizational agenda
• Fostering a genuine sense of a caring community with strong bonds of trust

Teams who genuinely care about each other are typically more productive, creative and have higher retention.

 

Chapter 7: Stress Management

While Disney is known to be a rewarding place to work with a low turnover rate, it can be a very stressful place to be employed. Disney’s “cast members” are actors as well as employees, so they cannot let personal matters affect their work. As a result, Disney trains employees in emotional regulation, which is the ability to control emotions in order to fulfill occupational duties. This process can take a lot of effort when dealing with a difficult customer or when an employee is experiencing a bad mood, and this effort and cognitive dissonance can lead to distress and emotional exhaustion at work. It has been reported, however, that this stress usually is not destructive to the company. For one, pretending to be in a good mood or acting as a character usually leads an employee to either forget what they are upset about or changes their mood for the better. Furthermore, stress among Disney employees usually does not lead to participation problems or performance decrements, because the employees are well managed, satisfied with their work, and they know that their hard work will be rewarded, so a little stress does not lead to destructive behavior and is usually seen as a good thing. When a cast member is stressed, it is usually because they have a real desire to perform well at their job and achieve their main duty – to make people happy.

Chapter 6: Performance Management & Goal-Setting

According to disneyinstitute.com, Disney believes that the success of employees is crucial to the success of the company. The company uses three techniques to measure the success of their front-line employees. They use peer-to-peer review, specific measurements (depending on the role), and managers closely watch and monitor the attitudes of employees.The company also gives annual performance appraisals in order to “give the employee a broad perspective of his/her accomplishment from the previous year and to identify upcoming challenges.” The company also has an extensive reward system to keep employees motivated and effective.

All of Disney’s current performance management policies stem from the idea of Walt Disney himself. His first idea was alignment, for which he lead by example, gave employees ownership of the organization’s goals, and engaged his employees to get them excited about an upcoming assignment. Disney’s second idea was transparency and collaboration. Disney encouraged employees to contribute their thoughts and ideas about a project. In doing so, Disney created an environment where peer review was a daily activity, and employees could know immediately if something they did was approved of or disproved of. Disney’s fourth idea was recognition. He never hesitated to praise an employee who did great work in front of the entire team, which further engaged and encouraged his employees. Finally, Disney implement frequent feedback and training. Instead of taking a job away from an employee who wasn’t performing well, he would team them up with a more skilled employee as a form of mentor. All of these initial programs implemented by Walt Disney himself have lead the company to have a great performance management system and a very low turnover rate.

 

Chapter 5: Motivation

Disney companies place great value in motivating their employees, because their brand comes from the exceptional experience customers get when they buy a Disney product, watch a Disney movie, or visit a Disney theme park. Disney employees 50,000 people in the United States alone, so motivation is a broad and important process. The process begins at the very first stages of a Disney career – at orientation, employees are engaged on an emotional level. In the words of a Disney seminar leader, “We don’t put the Disney in people, we put the people in Disney.” Furthermore, Disney has an “extensive reward and recognition program”, which “helps create a supportive environment to encourage employee enthusiasm. Employee rewards range from departmental, to regional, to company wide to ensure that recognition is received at all levels. The company also gets creative with rewards – they further engage employees by allowing them to choose their own rewards, and give employees public recognition by displaying them as proprietors on the stores that line Main Street in Disney World. In doing so, Disney’s management provides rewards and motivation to reach employees on all levels of Maslow’s Hierarchy of Needs, and show that they have a full understanding of how to motivate employees at all levels. It is also clear that Disney knows a satisfied, motivated employee leads to a satisfied customer. The Walt Disney Company’s vision statement is “To make people happy”, and it is clear that their employees are the first step on that mission.