Disney Pixar Case Study

The mantra behind every merger and acquisition is: bigger is better. But some mergers that look right on paper often fail and new company files for bankruptcy. On other hand, some mergers are so successful that is hard to recall time when merged companies operated separately. One of those successful mergers was Disney-Pixar in 2006.

Up until that point in time, Pixar and Disney had already under their belts several collaborations, which in turn set the ground for the later merger. At that point in time, the other big CGI studio in the market was Steven Spielberg’s Dreamworks Studios, which were starting to catch up in the field and posed a real, palpable threat to the dominance of Pixar in their niche market.

HISTORY AND BACKGROUND

WALT

This success has been evidenced by the abundance of films they have produced over the last few years and the revenue streams they have generated. Even though competitors in the past, this merger helped prove the fact that the mergers with highest chances of survival are those in which one bigger company engulfs another smaller company within the same market but distant enough not to be considered a direct competitor. That was the case for Disney – Pixar, since Pixar related to Disney only on a fraction of the whole scope of their business – Disney Animation

In this analysis, include any best practices they possess and how the other company might benefit from them. We might go as far as calling this a cultural due diligence exercise. A company’s culture, in the end, proves to be even more important than their results, especially for some key aspects of mergers.

 Do not underestimate the importance and repercussion of not communicating changes clearly and efficiently to all the affected personnel. This will ease the integration process and generate less pushback from employees at both sides of the deal.

 Maintain a certain level of independence between the merged companies under the new structure. This will prove functional and valuable especially if there are synergies to be obtained from the results generated by teams working under their original organizations in a way they are used to. They can focus on what they do best and deliver quality work.

 Communicate, communicate and communicate. This is the backbone of a successful merger and can never be stressed