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How Bob Iger Remade the House That Walt Built

Instead of the easy fixes, Bob Iger played the long game by addressing Disney’s cultural issues head-on, by making it stronger and more profitable with greater depth.

The company had grown very large, particularly after the acquisition of Capital Cities/ABC. And it was operating in many changing and dynamic businesses.

While it had made sense to create overall strategy at the center, we had grown so large and were operating in such dynamic businesses that I thought that actually slowed decision-making down, lessened accountability and created at some level—more inadvertent than purposeful—of mistrust, where business units didn’t feel as trusted as they needed to be by the corporation. What had served us well in the past was no longer optimal.

So how do you manage the company differently today?
While we still have strategic planning, it’s reconstituted with a different mission. For one thing, the business units create their own strategies. I want them to fit into a framework of the company, and they need to be consistent with the company’s strategic priorities. But a different strategy for each business had to emanate from the businesses and be implemented by the businesses.

“The business units had to feel not only a sense of empowerment but a sense of ownership over their own destinies—and thus a sense that they were trusted.”

In addition, most key business decisions that were being made needed to be made by the individual businesses, with either the approval, knowledge or even involvement in an advise-and-consent sense of the corporation. The business units had to feel not only a sense of empowerment but a sense of ownership over their own destinies—and thus a sense that they were trusted. If they could not be trusted, then instead of taking away the freedom and responsibility from them, we had to get new people.

Shortly after becoming CEO, you struck a deal with Steve Jobs and Apple to put a Disney app on the then new video iPod and iTunes. Why was it considered controversial at the time?
That was a huge step—or a very loud signal to the company that technology could be viewed as friend, not foe, or as opportunity, not threat. It affirmed that we were willing to take risks and were willing to challenge the status quo of our own businesses, willing to enter partnerships with technology companies and willing to embrace technology as a path to a much brighter future. This was probably the loudest message I could have sent to this company about change.


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