Chris Harper April 10, 2012 Management and Organization Dr. Scruton The Walt Disney Company’s Control Factors Disney has different types of controls that help their business run efficiently on a daily bases. Two examples of controls are financial and operational. Also, Disney has information systems that play a role within their company. Disney has different managerial innovation practices from encouraging their employees to possess entrepreneurial spirit to their job tasks. In response, Disney has ethical dilemmas that they face from giving employee empowerment to seeing how technology plays a role in managerial practices.
Disney may or may not show social responsibility. This leaves to question if Disney an organization that I would want to work for in the future? Using evidence from various sources I will attempt to answer these questions about controls, managerial practices, and accessing whether or not I would want to work for Disney. What does it mean for control to happen inside an organization? For control to be achieved inside an organization there has to be a process of monitoring, comparing, and correcting work performance that is going on inside an organization (Robbins, 487).
Control is one of the management functions and it is a very important one. Disney’s process of controlling is done through these main areas “standard work is an in-control process, employees are called “cast” members because they are always “on” [stage], controlled processes require ongoing improvement for them to continue to satisfy customers, attention to details should be a way of life, committing to the message is as important as the message itself” (Free, 2007).
This information was taken from the Management Update Conference held at Disney World in Orlando, FL. Miles Free which was an attendee of the conference who wrote an article that explained Disney’s emphasis on control, so through his article he will inform us on what those controls entail. Free states that the standard work is an in-control process pertain to Disney’s use of Standard methods. One way Disney uses standard methods is through “costuming” is an easy-to-spot standard that controls the appearance of the heme park, thus affecting [the] guest’s experience and perception of Disney World” (Free, 2007) By doing this the employees at Disney buy into the standards by being involved in improving the standards [that are set forth]. Therefore, Disney achieves its goal of controlling the customer experience, while allowing employees to be a part of the process. From, this type of model it shows why Disney has been so successful over the years. Next, Free mentions how employees are called cast members because they are always on stage.
Every Disney employee is considered a “cast” member, and this distinction goes beyond semantics… Disney recognizes that its purpose is to perform a “production” for its guests. Therefore, all employees have a part to play in the production. Human performance is variable in that some people perform better than others. The Disney cast member approach assures that all employees know and behave as if they were on stage [meaning that they are always on display].
This is [considered a] high standard, yet it is consistently achieved at Disney [because of their vision] (Free, 2007). From my personal experience of attending a few YES (Youth Education Service) Program leadership conferences at Disney World this past spring break I saw this philosophy first hand and heard it from some of the “cast” members themselves. The Performance Art Director explained their business model to my class and mentioned how the cast members played an important role of control of that model.
She did this through a formal speech at Soarin ride while my class participated in the YES Program. Disney uses the W. Edwards Deming’s Plan-Do-Check-Act cycle as part of their control process to improve and satisfy their consumers (Free, 2007). The W. Edward Deming’s Plan-Do-Check-Act cycle is a cycle outlines how you can control operations by planning to improve your operations first by finding out what things are going wrong (that is identify the problems faced), and come up with ideas for solving these problems.
Second, the cycle outlines for you to do changes designed to solve the problems on a small or experimental scale first. This minimizes disruption to routine activity while testing whether the changes will work or not. Third, the cycle outlines for you to check whether the small scale or experimental changes are achieving the desired results or not. Also, [for you to] continuously Check nominated key activities (regardless of any experimentation going on) to ensure that you know what the quality of the output is at all times to identify any new problems when hey crop up. Fourth, and the last part of the cycle is designed to have you Act to implement changes on a larger scale if the experiment is successful. This means making the changes a routine part of your activity. Also, act to involve other persons (other departments, suppliers, or customers) affected by the changes and whose cooperation you need to implement them on a larger scale, or those who may simply benefit from what you have learned (Deming, 2011). This process is applied throughout Disney and involves all employees.
Examples of different ways Disney uses each part of the cycle for controls to better their business is from anything from customer supplier mapping to data check-sheets. According to this cycle the planning process of control helps bring improvements by using flow charting, brain storming, nominal group techniques, solution fault trees, evaluation matrix and cause and effect diagrams. According to this cycle control process is monitored by doing changes on a small scale first to trail and see if they will work or not.
Disney does this by assigning small groups to complete projects and allow them to use the leadership skills they have to complete the task. Disney continues to do this through having experimental designers, conflict resolution methods, and on-job training for employees to learn what is expected of them in the company. Disney remains to check their controlling by monitoring graphical analysis, control charts, data check-sheets, and key performance indicators. Then, lastly Disney will act on their control process.
Disney acts on their control process by process mapping, process standardization, controlled reference information, and formal training for standard processes (Deming, 2011). Again, I have seen some of these aspects of the Plan-Do-Check-Act cycle first hand by seeing example hearing an example of their employee training process. Disney will do some activities during employee training that include role plays to situations that could occur and give them solutions on how they should handle them.
What are financial controls? Financial controls are the avenues in which a company monitors and protects its finances by implementing policies that document where, how, when money is being spent by the company. This is my own personal representation. According to Disney’s Charter of the Audit Committee of the Board of Directors Disney has a very specific and detailed way of controlling their finances. Disney financial controls are monitored in this way by “[the] Board of Directors of The Walt Disney Company include versight of the Company’s systems of internal control, preparation and presentation of financial reports and compliance with applicable laws, regulations and Company policies” (The Walt Disney Company, 2009) The Walt Disney Company’s financial controls are control through these policies stated by the Board of Directors at The Walt Disney Company. They are: “the Committee shall monitor the preparation by management of the Company’s quarterly and annual external financial reports.
In carrying out this responsibility, the Committee shall: review with management the significant financial reporting issues, judgments and estimates used in developing the financial reports, including analyses of the effects of alternative GAAP methods on the financial statements; review the accounting and reporting treatment of significant transactions outside the Company’s ordinary operations; review with management and the Company’s independent auditors significant changes to the Company’s accounting principles or their application as reflected in the financial reports; review with management and the Company’s independent auditors the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on the financial statements of the Company; meet periodically with the Company’s independent auditors (in private, as appropriate) (a) to review their reasoning in accepting or questioning significant decisions made by management in preparing the financial reports; (b) to review any audit problems or difficulties and management’s response; (c) to review any outstanding disagreements with management that would cause them to issue a non-standard report on the Company’s financial statements; (d) to examine the appropriateness of the Company’s accounting principles (including the quality, not just the acceptability, of accounting principles) and the clarity of disclosure practices used or proposed; (e) to determine if any restrictions have been placed by management on the scope of their audit; and (f) to discuss any other matters the Committee deems appropriate; meet periodically in private with the Company’s management; review earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies and discuss their appropriateness with management and the Company’s independent auditors, paying particular attention to any use of “pro forma” or “adjusted” non-GAAP information; and review draft quarterly and annual financial statements and discuss their appropriateness with management and the Company’s independent auditors, including the Company’s disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (The Walt Disney Company, 2009). This is short glimpse of how Disney maintains control of their finances.
Why are operational controls important inside a business? “Operational controls are designed to ensure that day-to-day actions are consistent with established plans and objectives. It focuses on events in a recent period. Operational control systems are derived from the requirements of the management control system. Corrective action is taken where performance does not meet standards. This action may involve training, motivation, leadership, discipline, or termination” (Barnat, 2007). Disney demonstrates there operational controls through there training program and what their goals for their employee in which are going through those training program.
One of the Workplace guide websites for Disney states that “[the] Disney University offers a series of leadership development courses for all levels of leadership at Disney, from first-time managers to executives. The curriculum not only promotes a consistent set of leadership practices across the company, but also provides leaders the support they need to progress in their careers and build their capabilities. Internal executives identified as role models “give back” by getting involved in leadership development as teachers, mentors and coaches. Development is available for everyone, not just those who lead others. An individual contributor, for instance, is viewed as a leader of his or her own work. Disney employees have access to instructor-led and online opportunities to develop personally and professionally.
Topics include communication, critical and creative thinking, project management, time management, technical and artistic skills development, cultural awareness, diversity, ethics, safety, career development and wellness” (The Walt Disney Company, 2008). In addition to the Disney University, Disney upholds a standard to help employees in other types of training that are beneficial by “To foster career growth, employees and Cast Members at all levels participate in a global performance management program that is structured to provide them with ongoing feedback from their leadership. In addition, an internal process that posts information about current open positions companywide takes Cast Members and employees through every step of the process – from searching for a job posting to submitting a resume online.
Many segments provide workshops and online classes in resume writing, interviewing skills and career planning to assist employees in reaching their career goals. Disney executives also engage in a talent planning process that helps employees develop themselves for potential future placement within our many and diverse businesses. This formal planning process is conducted throughout the company. These ongoing talent conversations with senior leaders provide employees with an opportunity to be considered for task force assignments as well as regular positions across the company, both domestically and internationally” (The Walt Disney Company, 2008).
As you can see Disney demonstrates an effective way of approaching to control operational activities. They do this through various ways to train and help their employees to be able have knowledge and understand of how The Walt Disney Company works and what is expected of their employees. Information systems play a pivotal role within The Walt Disney Company Disney’s main source that is classified as information systems is Walt Disney Internet Group (WDIG) “Walt Disney Internet Group (WDIG) provides strategic leadership and operational management [and an information technology system] for The Walt Disney Company’s (NYSE:DIS) Internet properties including category leaders Disney. com, ESPN. com and ABCNEWS. com.
A market leader in developing and distributing entertainment and informational content to new platforms, WDIG is committed to creating and delivering products for broadband distribution including: ABC News On Demand, a subscription video news service that offers the Internet’s first 24-hour, live Internet-only news channel and top ABC News programs for on demand viewing; Disney Connection; and WDIG Motion, a proprietary video technology for broadband users. Through relationships with some of the world’s largest wireless carriers, WDIG distributes content and services to wireless users under the Disney brand” (The Walt Disney Company, 2005). In conjunction to Walt Disney Internet Group they have expanded their operations to the mobile phone industry that is one of Disney’s main avenues of communication for its employees.
In addition there are many other information systems for various departments which include: “Systems, Applications and Products database (“SAP”) for financial and human resources management purposes; a document management database (“Hummingbird”) for finance and human resource management purposes; a rights and a contracts management database (“Zeus”) for administration of international television programming distribution; an accounts receivables management database (“Get Paid”) for the process workflow for invoices and customer management; a global learning management system (“Disney Development Connection”) for the administration of employee training and retention of employee training records; and a global performance management system (“Performance Connection”) for the administration and harmonization of employee evaluation and talent planning processes; global performance management system (“Performance Connection”) for the administration and harmonization of employee evaluation and talent planning processes; the Customer Data Environment (“CDE”) processes consumer data, including personally identifiable data collected in the European Union, for marketing purposes. The Workscape Compensation Management System (“Workscape”) processes employee data for the purpose of determining employee compensation the Headcount Tool (“Headcount”) is an online reporting application which tracks headcount data” (The Walt Disney Company, 2002). As you can see from the information from the The Walt Disney Company website that there are many different ways and reasons information systems are used to help controls within the company. Disney has innovative managerial practices through entrepreneurship being encouraged within its employees. What is Entrepreneurship?
Entrepreneurship is “the process of starting new businesses, generally in response to opportunities” (Robbins & Coulter, 2012). The main point of this section is to explain how or why Disney encourages an entrepreneurial spirit within its employees. Disney encourages entrepreneurship within all of their jobs from upper to lower management. For an example, I found a job description for a Sales and Ticketing Manager and within the job description it included “If you have an entrepreneurial drive, a winning attitude and would enjoy working for a fun, fast paced and adventurous company [then working for Disney will fit you]” (The Walt Disney Studios, 2012). Disney has ethical dilemmas within employee empowerment and the role of technology.
Disney empowers there employees by “giving [there] employees more authority [and power] to make decisions (Robbins & Coulter, Glindex, 2012). ” [The Walt Disney Company] is the epitome of customer service and [employee] empowerment. Empowerment is a religion there. Employees are thoroughly trained and then told they have the authority to do whatever is necessary to deal with problem on the spot in order to make customers happy. In fact, management interference is discouraged” (Tschohl, 2008). Another piece of evidence that supports how and why Disney empowers there employees by the one of the management principles of Disney is “All for One and One for All”, highlights the importance of teamwork and empowerment of the employees.
Teamwork is described as a method of fostering intense loyalty, enthusiasm and commitment. Because the focus at the Disney Company is to make sure that each guest has a memorable and pleasant experience, it doesn’t matter whose “job” it is to pick up a piece of trash. It becomes everyone’s responsibility” (Capodagli, 1999). Disney has other ethical dilemmas that have occurred that should be brought to your attention such as child labor issues. In a blog that I researched there was a fourteen year old that died from performing a hazardous task and this could have been prevented if Disney would have took in more consideration for their young employee counterparts (blogteam14, 2010).
Another ethical dilemma is between the differences in wages for Disney’s workers in China compared to the ones working in the United States. According to the article titled Ethical Issues Faced by Disney Walt in Overseas Market this is what the issues were said to be” The Walt Disney Walt has to confront its own ethical dilemma in the overseas market in China. One of the ethical issues it faces is wage disparity between the local Chinese employees and US employees who have been relocated to work in Chinese Walt Disney parks. The significance of paying US employees more than their Chinese counter parts is because it is expensive for a foreigner to live and work in China.
The significance of paying US employees more than their Chinese counter parts is because it is expensive for a foreigner to live and work in China (Ethical Issues Faced by Disney Walt in Overseas Market, 2011). An additional example that has transpired into an ethical dilemma by Disney is “Disney should [have been] more careful about the health of kids than any other U. S. company, because parents are going to trust Disney. Parents might legitimately be inclined to pass on buying cell phones for their children because of their own reservations about health issues, but if Disney is pushing them, they might well be persuaded otherwise (Ethics Scoreboard, 2005). The Walt Disney Company has technology breaches between its consumers from time to time.
There was a YouTube video called Boycott Disney: a Just cause Part 1 that portrayed Disney to be a non-wholesome company that should be boycotted by all Southern Baptists and this went on from June 18, 1996 and ended on June 22, 2005 (Dobson, 2009). From the various sources seen above you have now seen some ethical issues that The Walt Disney Company has had to face. Is Disney social responsible? Does Disney have a level of Corporate Social Responsibility? The answer is a yes in a big way. In 2011, The Walt Disney Company won the Jane Goodall Global Leadership Award. This award was given to a corporation that took significant steps to better our world through using responsible business practices.
Before 2011 Disney was presenting a good sense of Corporate Social Responsibility as well. This is shown through the article Disney Redefines the Concept of Corporate Social Responsibility when it was mentioned that Disney is “Disney is redefining the concept of corporate social responsibility by making an eco-friendly television commercial for their greener lifestyles project. This is part of Disney Channel’s “Disney’s Friends for Change: Project Green” (www. Disney. com) campaign, which is one of their corporate social responsibility initiatives that promote greener lifestyles. Other programs by the Disney Corporation include recycling and waste reduction projects. “The Disney’s Friends for Change: Project Green initiative invites young people to join together to help the environment across four key areas: climate, water, waste and habitats. Kids will learn practical ways to preserve the planet, track their collective impact and have the opportunity to vote on how $1 million in donations from Disney will be divided and invested in various environmental causes over the course of a year” (Planet Forward, 2009). Another example of how Disney shows great Corporate Social Responsibility is when “Walt Disney World Resort today unveiled plans for three significant financial donations to the Central Florida community led by a $12. 5 million commitment to the Dr. P. Phillips Orlando Performing Arts Center (DPAC), it was announced by Meg Crofton, president, Walt Disney World Resort. Disney Cast Members take great pride in supporting our community and making Central Florida a better place to live, work and play,” said Crofton. “It’s exciting to be a part of the renaissance” (Disney Corporate Citizenship, 2007). So, as you can see from the numerous examples shown The Walt Disney Company has a good reputation of upholding strong Corporate Social Responsibility. Would I want to work for The Walt Disney Company in the future based on the research I have already done and will continue to do? The answer is yes, I would love to work for Disney. I have been visiting Disney theme parks since I was five years old and have continued to enjoy my visits year after year.
After researching the companies control structures and managerial innovation practices; I am convinced Disney stands for and has a culture of an organization I would want to work for in the future. To add to what I have already researched I am going to “dig” a little deeper and find some literature reviews from the upper-management of the company and find some employee reviews that will even back-up my decision more. Bibliography Ethical Issues Faced by Disney Walt in Overseas Market. (2011, May 18). Retrieved from Scholarly Articles Research: http://scholarly-articles-research. blogspot. com/2011/05/ethical-issues-faced-by-disney-walt-in. html Barnat, R. (2007). Operating Control. Retrieved from The Primary Types of Organizational Control: http://www. strategic-control. 24xls. com/en117 blogteam14. 2010, February 20). Resolving Disney’s Ethical Dilemma:. Retrieved from Blogteam14 Blog: http://blogteam14. wordpress. com/2010/02/20/resolving-disney%E2%80%99s-ethical-dilemma/ Capodagli, B. a. (1999). The Disney Company’s 10 Management Principles:. Retrieved from MANAGEMENT AND ACCOUNTING WEB: http://maaw. info/ArticleSummaries/ArtSumCapodagliJackson99. htm Deming, E. W. (2011, March 10). From Problem-faced to Problem-sovled. Retrieved from HCIhome: http://www. hci. com. au/hcisite3/toolkit/pdcacycl. htm Disney Corporate Citizenship. (2007, May 14). Walt Disney World Resort Donates $12. 5 Million to Dr. P. Phillips Orlando Performing Arts Center. Retrieved
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