Most Influential CEOs: Disney's Bob Iger Resists "Legacy" Baggage
The media chief has proven to be a tough, stubborn negotiator unburdened by Disney's fairy tale history.
As the chief executive of Disney (DIS), Iger, 59, is now one of the most influential businessman in the world. He sits at the top of a company with more than 140,000 employees, a market cap of $70 billion, and businesses as varied as ESPN and theme parks. In his tenure, he has deftly guided Disney through a recession from which it has emerged stronger.
How he's done that, however, is where Iger receives great praise. Iger has the weighty responsibilities of managing a legacy business, but he has sharply broke from that legacy in expanding and reorganizing Disney's media and entertainment divisions. Once a laggard, Disney now leads the way among big media companies, namely in movie-making.
This is something few outsiders expected of Iger when he took the helm five years ago with a faint endorsement from his predecessor, Michael Eisner, according to the 2005 book DisneyWar. Iger -- who started his career in 1972 as host of an Ithaca College TV show, then moved up the production ranks with ABC until he was president -- wasn't thought to be an iconoclast.
But in his new role, he's become an aggressive dealmaker -- with Disney's $7 billion purchase of animation studio Pixar, and $4 billion acquisition of Marvel, the comic book publisher and movie studio -- and an unsentimental boss, changing the way Disney does business in Europe, and reorganizing its movie studio last fall and in the process, forcing the departure of at least a dozen top managers.
And there are other examples. Last fall, as other retailers scaled back, Iger ordered an overhaul of 340 Disney Stores at a cost of $1 million each. In November, Iger gained the Chinese government's approval to build a Disney World-style theme park in Shanghai. And, on the movie-making front, Iger nabbed Steven Spielberg, whose company, DreamWorks Studios (DWA) will release its films through Disney beginning next year.
What's more, Iger has been a corporate bare-knuckle brawler. In March, a tense, bitter feud with Cablevision's (CVC) James Dolan over fees Disney wanted Cablevision to pay to carry WABC-TV led to New Yorkers losing the ABC affiliate the night of the Academy Awards. An agreement was reached at the last minute and the broadcast went live right before the first presentation for Best Supporting Actor. Disney/ABC isn't done, though: It will likely turn its cannons to Time Warner Cable (TWC) in September in regard to the same fees.
Iger's moves have been heralded as bold and risky, but perhaps not as risky as the alternative -- hoping Disney could live on its reputation instead of adapting to the digital era. Breaking from the past will ultimately be Iger's legacy, even though he has faced resistance in doing so.
"The baggage of tradition," he said of Disney's culture in a New York Times profile, "can slow you down." He added: "I'm not going to eliminate that, but I'd like to reduce it significantly."
No less than Steve Jobs, Apple's (AAPL) CEO, and Warren Buffett -- two other iconoclasts -- extol Iger's performance as the head of Disney.
"The spectrum of points of view this job requires is incredible, and Bob is great at it," Jobs told the Times. A Disney board member, Jobs became its largest shareholder after the Pixar acquisition. He added: "The amount of energy and passion at Disney has increased dramatically. The business lines were really in boxes before Bob empowered them."
"He's not constantly trying to show you how smart he is, and that is a very important trait in Hollywood, where you've got to rely on talent who consider themselves the center of the universe," said Buffett, who has known Iger since the mid-1980s.
Disney still has work to do in the online space, and, with its Marvel acquisition (for which it paid a 29 percent premium) and video-game division, hopes to make inroads among young men, historically a weak demographic for the company. Some analysts argue the Marvel deal will be a mistake over time.
But, under Iger, the theme for Disney is "change," which, for the company that rode Mickey Mouse's little tail for so many decades, is undoubtedly surprising.
"Our brand is so powerful because of our heritage," Iger told the Times. "But you've got to innovate, and not just in terms of what is new today but what will be new far into the future."
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