Strategic Management - Pixar - Success

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Newcastle Business School

Assignment: Strategic Management and Leadership

Table of contents
Question 1
1.1 Introduction3
1.2. External analysis of Pixar Animation Studios3
1.2.1. Macro environment3
1.2.2. PESTEL-Analysis3 Political factors3 Economic factors4 Social factors4 Technological factors4 Environmental factors4 Legal factors4 Conclusion4
1.3. Internal analysis of Pixar Animation Studios5
1.3.1. Principle of Innovation5
1.3.2. Business Culture5
1.4. SWOT-Analysis of Pixar Animation Studios6
1.4.1. Strengths7
1.4.3. Opportunities7
1.4.4. Threats7
1.5. Conclusion and Prospect7
Question 2
2.1. Introduction9
2.2. Theory9
2.3. Failure in Research in Motion Limited (RIM)9
2.4. Another example (Kodak??)9
2.5. Role of leadership in these organizations10
2.6. Recommendations to avoid strategic drift10
2.7. Conclusion10

Question 1

1.1 Introduction

The Pixar Animation Studios is an American computer animation studio based in California, United States. In the more than 20-year production phase of the company, which produces one box office hit after the other, no significant failure could be recorded. Therefore it is no wonder that large movie manufacturing giants, such as the Walt Disney Company, wanted to be part of this great success and were seeking a lucrative contractual merger which culminated in the 2006 takeover (BBC News, 2006). Before the takeover, Pixar was under a partnership agreement with Disney for the film distribution and marketing. Pixar leads, close beside DreamWorks, the market of computer-generated animated films (Hecht, 2009).

In order to identify the company’s opportunities and threats, hereinafter will be an external analysis of the macro environment. To identify Pixar’s key success factors, namely their principle of innovation and their business culture, an internal analysis of the Pixar Animation Studios will follow.

Subsequently a SWOT-Analysis will be used to connect the external and internal analysis.

Finally, there will be a Conclusion and Prospect, which summarises the key success factors and demonstrate briefly the potential capabilities for continuing their success.

1.2. External analysis of Pixar Animation Studios

In order to identify the key success factors and the company’s opportunities and threats, it is important to study environmental factors that effect the firm’s strategy on the industrial level (Grant, 1998).

1.2.1. Macro environment

The Macro environment has been researched through a PESTEL analysis in order to get an overview of how the factors that influence the computer animated film industry, and therefore the Pixar Animation Studios.

1.2.2. PESTEL-Analysis

The PESTEL Analysis is a framework utilized to scan the environment of an industry (Jeffs, 2009). It includes the political, economic, social, technological, legal and ecological environments.

The animation industry by itself is a blooming one(, and as this firm is presently based in the United States it also allows for a lot of international scope. The PESTEL analysis can assist Pixar in their ability to create a strategy that can further their understanding of the macro environment. Political factors
The political factors in the USA for the animation industry are quite favorable. The reason for this is that the USA is a progressive nation and technology is favored. Hence, the animation industry regulations are not very stringent when compared to other industries. Moreover, as animation is gaining rapid popularity, the political factors all around the world are extremely favorable. Economic factors
In spite of the dreaded global financial crisis and...
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