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Walt Disney Company is undeniably amongst the world’s most renowned conglomerates in the sphere of animation. Since the founding of the company in the year 1923 by Walt Disney and Roy O. Disney as the Disney Brothers Cartoon Studio the company has grown extremely fast from the company’s earliest animations such as Snow white to some of the latest films such as Star Wars. Although the success of the company has previously been linked to efficiency of its management, the enterprise has experienced a period of turmoil due to power struggles and conflict in the top administration. In this regard, this paper researches the conflicts and politics that have been witnessed in the company in the recent years and the conflict resolution strategies that have been used to resolve these conflicts.
Conflicts, Politics and Conflict Resolution
The period, before Bob Iger got the power as the Chief Executive Officer in the year 2005, had been marked by extended turmoil in the leadership of the company. The feuds in management of the company started simmering in the December 2003, when Roy Disney, a nephew of the company’s founder and another board member Stanley Gold resigned from their respective positions.. The two long-term allies had left the board so other members could insist that the CEO Michael Eisner should vacate appointment (Holson, 2002).
Sources of the Conflicts
The first source of the conflict that is notable in this case is the aspect of running a family business. Roy was the last of the Disney family members that remained on the board. Roy’s presence was potentially problematic as any opposing view would be met with objections , lodged by Roy and his allies on the board. Being a son of one of the Disney brothers and the nephew of the Disney company founder, Roy kept a strong grip on the company. It was one of the main aspects that brought about power struggles.
The Disney family investment plummeted gradually, and it threatened Eisner’s position as the CEO. The other source of conflict in the company was the financial slowdown that was prompted by economic problems. Being the Chief Executive Officer at this point, Mr. Eisner was blamed for the challenges at the management level and for the financial slowdown of the company. Scholars argue that the biggest problem in the group was the structural and hierarchical make-up of the enterprise. Eisner himself ascended the position after the complicated restructuring process that was supported by Roy Disney in the year 1984. As the result, Bob Iger got the grip on the company that had a wide range of internal conflicts.
During the first year of his leadership in Walt Disney Iger was focused on the transforming of structural and managerial approaches. One of the first steps that Iger made during this period was resolving the long-standing conflict between shareholders, which resulted in a conflict between Stanley Gold and Roy Disney (The Daily Beast, 2009). Iger convinced both antagonists to seek reconciliatory approaches and drop the long-standing court case. Indeed, this approach was the first step towards ensuring that the protracted conflict related to Eisner, which threatened to divide the company, was resolved. In the days that preceded the resolution of this dispute, Iger had embarked on a long reconciliatory process that was aimed at restoring the confidence of the company’s stakeholders and employees in the stability of the company.
Iger also adopted “hands off” approach in handling the issues within the enterprise. This method ensured that there would be minimum of power struggles and political arguments during his leadership. Iger also adopted the approach of negotiation with other companies such as Pixar animations and Marvel, where Walt Disney Company has established partnerships, aimed at enhancing the company’s control in the entertainment industry. According to scholars, Iger managed to pacify the situation in the company due to his ability to resolve conflicts through amicable approaches to subordinates.
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Sources and Effects of Power on Organization Structure
Power is an essential component in an organization, especially because it affirms authority and influence. The durable influence in an organization may be the result of a number of factors. There are different sources of power in an organization. Expert power is one of the sources of supremacy in an organization. Expert power means that an individual possesses expertise in a particular area of practice that allows such person to handle issues and solve complex problems in the field of practice.
Legitimate power is another source of authority in an organization. In most cases legitimate power derives from the position, a person holds in an organization. For example, a board member may yield more power in an organization than a manager due to the differences in the hierarchical levels. Coercive power is another source of influence, which, in most cases, is used by a person to control or threaten other junior staff with punitive actions or sanctions if they fail to obey. For example, in the case of Walt Disney Company, Roy may have had the coercive power to control decisions regarding the company even after his resignation from the position of the board member due to his influence as a founder’s nephew.
Power may have positive or negative consequences, depending on the holder of such power and the extent, to which the power is used. For instance, power increases efficiency in an organization, when the holder of such authority uses his influence to improve processes. On the other hand, power may have a negative effect, when the representative of such authority uses coercive means to dictate terms and force compliance, even when such conformity may be detrimental to the organization.
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