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Eisner, Michael - Overview, Personal Life, Career Details, Chronology: Michael Eisner, Social and Economic Impact

disney company walt eisner’s

(1942-)
Walt Disney Company

Overview

Entertainment executive Michael Eisner is the chief executive officer of the Walt Disney Company. He began as an usher at NBC and eventually rose to such positions as head of prime time programming at ABC and president of Paramount Pictures before assuming control of Disney in 1984. Considered a great judge of talent and a shrewd businessman in a tough industry, Eisner is also known as a devoted family man.

Personal Life

Michael Dammann Eisner was born in Mt. Kisco, New York, the son of a well-to-do lawyer, and was raised in luxurious surroundings in his parents’ spacious Park Avenue apartment in New York City. His early life was characterized by discipline and strict etiquette that included wearing a jacket and tie for family dinners. Although raised in wealth, he learned early to treat money seriously. Eisner’s father, Lester, was a Harvard graduate and a lawyer who successfully invested an existing family fortune in New York real estate. Lester Eisner also served as a top housing official in the Eisenhower administration.

Eisner and his sister were taught self-discipline early. Among other lessons, they were required to read each day for two hours for every one hour of television they watched. Eisner enjoyed reading “Hardy Boys” mysteries and the works of Jack London, and his television favorites included Hopalong Cassidy, Ozzie and Harriet, and Leave It to Beaver. Entertainment for the Eisners often included Broadway, and Eisner marked every special occasion with a visit to the theater.

Eisner attended Lawrenceville School, an expensive New Jersey boarding school, where he was a good student. He tried sports but was largely unsuccessful. He belonged to the Periwig theatrical club and won a lead role in The Caine Mutiny as a senior, but illness forced him to withdraw.

After Lawrenceville School, Eisner enrolled in Denison University, a small liberal arts college in Granville, Ohio. His intention was to prepare for a medical career, but by his junior year, he was back in the theater. Shy and not particularly driven to be an actor, Eisner began writing plays. He is known to have completed two plays, one of which was produced by the school’s thespian club. Eisner graduated from Denison in 1964.

Eisner and Jane Breckenridge were married in 1967. They have three sons, Breck, Eric, and Anders. Eisner is well known as a family man and prefers pictures of his family in business publications where others will use political shots with public figures. In the critical days leading to his election as chairman of Walt Disney Productions, he delayed meetings because of commitments to his sons. This quality of Eisner’s was likely not lost on those searching for Walt Disney’s replacement.

Career Details

After college, Eisner made a trip to Paris, thinking he would be a writer. He returned home, however, in less than two weeks. Back in New York, he went to work at NBC where he took a job as a clerk who kept track of the number of times a commercial aired. He also worked weekends at an NBC radio station, giving out traffic reports. Not long afterward, Eisner moved to CBS, where he inserted commercials into their slots for children’s programs, the Ed Sullivan Show and Jeopardy.

Somewhat dissatisfied with his career, Eisner sent out hundreds of resumes, looking for a break in the television business. That break came in 1966 when a young executive named Barry Diller called. Diller was only 24 years old but was already a vice-president at ABC. At the time ABC was a small network, only about ten years old, and with only a couple of dozen affiliates around the country.

Eisner moved to ABC and worked with Diller on ABC’s programming. Together, their innovations included the movie-of-the-week and the miniseries. Eisner genuinely enjoyed even the simple forms of popular programming such as sitcoms and cartoon shows. Thus, when he took over Saturday morning programming in 1969, he did not guess at what would sell, he just looked for what he liked to watch.

Eisner’s first push for Saturday morning programming was a cartoon series based on the popular singing group, the Jackson Five. Soon, he added another featuring the singing Osmond Brothers. Within three years, ABC was the top-rated network on Saturday mornings. Within five years, Eisner was put in charge of ABC’s prime time schedule, where he was responsible for such hits as Happy Days and Welcome Back Kotter. Even though the critics complained, the shows were successful and the ratings improved. Eisner understood that the core elements that worked for Saturday morning programming were universal: the importance of the story line, character development, and conflict.

He also was responsible for some serious work at ABC such as the miniseries Roots and Rich Man/Poor Man. ABC emerged from Eisner’s time as head of programming as the top-rated network on the air, but Eisner had already left for greener pastures.

In 1976 Eisner joined Paramount Pictures, where Diller was the chairman and Eisner became president. Paramount was not a strong company, which is why the parent, Gulf Western, brought in the two successful ABC executives. Paramount had not had a hit movie for several years and had lost money. Within a year, Paramount produced Saturday Night Fever, and a string of successful movies were to follow that included Raiders of the Lost Ark, Bad News Bears, Grease, Heaven Can Wait, and Beverly Hills Cop. Two years after Eisner joined Paramount, the studio led the “big seven” studios with nearly one quarter of national box office proceeds.

For six years, Paramount never fell below second in market share. However, two events in 1984 changed Eisner’s career direction in a dramatic way. First, his mentor and supporter at Paramount, Gulf Western’s chairman Charlie Bluhdorn, died. Bluhdorn’s successor, Martin Davis, did not think as highly of Diller and Eisner. Davis has been quoted as complaining that Eisner was not “serious” enough and was “like a kid.” Diller had his problems with Davis, also, and left to become chairman at 20th Century Fox.

The second event of 1984 was the culmination of two decades of problems and drift at Walt Disney Productions. Walt Disney had started the company in the late-1920s and after a couple of false starts had found success with the animated character Mickey Mouse. Together with his brother Roy, Disney had built an entertainment giant. Walt Disney’s sudden death in 1966 had deprived the company of not only its chairman, but of its heart and soul. Using Walt’s creative genius and his brother Roy’s business acumen, the company had been successful. Yet, like many family operated businesses, there had been little effort made to groom executives to succeed the founders.

The aftermath of Disney’s death was a slowing of growth and, eventually, stagnation in the Disney empire. Attendance dropped in the company’s theme parks, and movie production faltered. Earnings dropped and constant fighting between the “Walt” and “Roy” factions paralyzed the company. While the conflict was visibly between the two arms of the Disney family, the fight was actually between the creative people (Walt) and the administrators (Roy). This fighting actually paralleled conflicts that had existed between the two brothers for years, only now it threatened to destroy their dream.

Disney of the early 1980s was ripe for corporate raiders and take-overs. In the Wall Street climate of the time, it was not uncommon for companies in Disney’s condition to be taken over by speculators who would then break up the company and sell the parts for huge profits. Several such profiteers were buying up Disney stock or making overtures to the company and its major stockholders. Disney insiders, including Roy Disney’s son, also named Roy, were intent on saving the company.

A group that became known as the “brain trust” was formed. The members of the trust were Roy Disney, Frank Wells, a consultant to Warner Brothers, and Stanley Gold, a Disney board member who ran Roy’s company, Shamrock Holdings. The three set out to find a new manager for the company who would restore it to a position of strength, if not past glory. Eisner was a leading candidate from the beginning and was seen as articulate, imaginative, enthusiastic, and with values complementary to the company’s family identity. It was thought that Walt Disney himself would have loved him.

A protracted battle ensued and ultimately, then-current chief executive Ron Miller, who was Walt Disney’s son-in-law, was fired. Frank Wells was considered a candidate for the top spot, but he recommended Eisner. Finally, with the intervention of major stockholder Sid Bass, a compromise team of Eisner as chairman and CEO and Wells as president was proposed.

Chronology: Michael Eisner

1942: Born in Mt. Kisco, New York.

1964: Graduated from Denison University.

1966: Hired by Barry Diller at ABC.

1976: Named president of Paramount Pictures.

1984: Becomes chairman of the Walt Disney Company.

1986: Created international division of Disney.

1996: Disney acquired Captiol Cities company.

Stanley Gold, who was point man for the “brain trust,” pushed this team hard. According to Gold, Eisner’s reputation as a creative person and a “big kid” was perfect for the head of Disney. Gold said that the problem with Disney since Walt died was that the place had not been run by “crazies.” It “needed to be run by crazies again,” and Eisner was the man for the job. With the strong businessman Wells as Eisner’s partner, Gold was promoting the same type of team that had built Disney in the first place: Walt (Eisner) as the creative “crazy” that drove the company forward while Roy (Wells) applied the common sense and occasional braking that was necessary to satisfy the bankers and Wall Street. Gold’s efforts, with Sid Bass’s vocal support, proved to be very successful.

Eisner was appointed chairman and CEO of Walt Disney Productions on September 22, 1984. Wells became president, and the new team was off and running to reestablish the Walt Disney Company as the premier entertainment company in America. New blood was brought into the management team, many from Eisner’s old company, Paramount. The Disney film archives were utilized to their fullest capacity, the theme parks were restored to profitability with attendance again rising annually, the animation division of Disney returned to making feature-length films, and the stock value rose dramatically.

Over the first decade of Eisner’s term as chairman and CEO, Disney produced a string of movie hits including Down and Out in Beverly Hills in 1986, Who Framed Roger Rabbit in 1988, The Little Mermaid in 1989, and Beauty and the Beast in 1991. Alladin, the first animated feature to be nominated for an Academy Award for Best Picture, was released in 1992. Disney has produced a major animated feature nearly every year and got back into television with the hit show The Golden Girls and a revised feature, the Disney Sunday Movie.

Eisner spearheaded other ventures including a new amusement park, Euro Disney, which opened outside of Paris, although its initial returns were disappointing. Disney also acquired independent film company Miramax to produce more offbeat films, and in 1996, Disney acquired Capital Cities, which owned ABC television and the cable sports network ESPN. Almost 20 years after heading ABC’s prime time programming, Eisner headed the company that owned the network.

Under Eisner’s direction, greater emphasis has been placed on the construction and operation of company hotels at the theme parks and a cruise ship line is in operation. Disney now owns a professional hockey team named after a modest Disney movie hit, the Mighty Ducks, and it has acquired the Anaheim Angels baseball team.

By 1997, Disney’s annual sales had grown to $21.1 billion. Disney’s share price has grown 19-fold. The success story of Disney now even exceeded that of its creators, Walt and Roy Disney. Eisner had profited handsomely, earning millions in bonuses and stock options. While there has been some criticism of his compensation package and the amount of money he has earned, there is no question about the success of his ventures and the resulting strength of the company.

Social and Economic Impact

Eisner’s style is at once casual and friendly, but he is also hard-working, driven, and tough. His creative talent is unquestioned and has served him well, yet there are many stories around the entertainment industry of shrewd deals he has struck to make a movie and attention to detail in the financial end of the business. Eisner understands the need to let the creative juices flow, but he tempers this with the realization that the business must make a profit. In Hollywood, this has turned out to be a very successful formula.

Eisner is willing to pay the necessary salaries and fees to make use of top talent in Hollywood. This was a radical departure from the older Disney practice of being quite lean in the compensation department. Eisner understood the need to pay top dollar for the services of the likes of George Lucas, but at the same time, he looks for promising newcomers that will become the next wave of creative talent in Hollywood.

The strategy has been to make maximum use of the company’s strengths in name recognition, reputation, and assets while diversifying into other aspects of the entertainment industry. The growing number of hotel rooms under the Disney name, the cruise ship line, and the sports franchises are examples of this expansion into related areas upon which the Disney name can be capitalized.

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