Human Resource Management in a Business Context

by Alan Price

Provides a thorough and comprehensive overview of all the key aspects of people management using numerous real examples from actual business situations.

The Walt Disney Company was founded in 1922 by 21 year-old Walt Disney and his older brother Roy. Walt Disney was the creative producer, Roy the 'business brain' behind the company (Ellwood, 1998). The partnership ended only with Walt Disney's death in 1966. By the end of the 1990s, the Walt Disney Company had developed into a $23 billion media conglomerate, arguably the most influential force in the globalisation of Western culture (Ellwood, 1998).

Gomery (1994) argues that the Walt Disney Company was not always "a paradigm of corporate success". Initially specialising in animated films, it struggled to find a niche in the market until 1928 when it produced the first cartoon to use sound (Gomery, 1994). The company built on this success by negotiating distribution agreements with powerful corporate sponsors. It supplemented revenues by merchandising characters, initially Mickey and Minnie Mouse. Snow White and the Seven Dwarfs, released in 1937, was the first feature-length animated colour film and proved hugely successful. Innovative use of sound and Technicolor continued. Walt Disney also pioneered the use of 'audio-animatronics': life-like replicas of people and animals.

Early animation production was highly labour-intensive. Rigid division of tasks was further delineated on gender lines. By the time Fantasia was completed in 1941, the Walt Disney Company employed eleven hundred people. Ellwood (1998) describes Walt Disney as "a notorious workaholic, a perfectionist who ran his company like a personal fiefdom". Both "paternalistic and domineering" he rewarded loyalty and excluded dissenters. There were no women or black people promoted to senior positions during this period. The company was the only Hollywood studio without union representation and as such was targeted by the American Federation of Labor. Walt Disney became militantly opposed to communism after animators took industrial action over conditions and lack of recognition in 1941 (Gomery, 1994). See The Testimony of Walter E. Disney Before the House Committee on Un-American Activities 24 October, 1947

The Walt Disney Company responded to difficult economic conditions after the Second World War by expanding into television and theme parks. It continued to diversify into every sector of entertainment, publishing, film, broadcasting, and information technology. By 1971, both brothers had died. The business then seriously under-performed, especially within the film division, and came close to being broken up.

In September 1984 a new management team was employed, led by Michael Eisner and Frank Wells, both former executives with other studios. By 1988 they were " the highest-paid professional managers in the history of American business". However, Gomery (1994) suggests that despite their "supposed inventiveness" they adopted "common textbook business strategies" and maintained a 'hard' human resources management policy. Ellwood (1998) argues that real power within consumer capitalism increasingly has come to rest with those controlling the "infotainment industry". By 1991 the Walt Disney Company had become a corporate power.

The development of theme parks transformed the Walt Disney Company into "a core business in American mass culture" (Gomery, 1994). Disneyland opened in California, Florida, Japan and France between 1955 and 1992. Promoting fantasy and well-being, coupled with high consumerism, they are under-pinned by a comprehensive, largely invisible surveillance and control system (Hannigan, 1998). Together with other leisure enterprises they accounted for about 17 per cent of the company's revenue in 1997. The theme-park model is extensively reflected in contemporary urban and commercial development and thus has been said to mediate "social relations around the world" (Ellwood, 1998). The company runs People Management courses using its own practices as a model.

Walt Disney World in Florida contains four theme parks and associated services, and attracts 30 million visitors a year. It employs 50,000 people, the largest number of workers located at one site in the USA, the majority in low-paid service jobs. The Florida state government initially was attracted by the development potential and gave the company "all the rights and powers of an independent municipal government" (Ellwood, 1998). The company has secured major tax concessions and effectively is exempt from state legislation governing various aspects of transport and public services (Wilson, 1994). The impact on the economy and development of Orlando and surrounding areas has been profound, with increasing disparity between affluence and poverty.

Employees are routinely assigned jobs according to age and appearance, a process officially known as "casting". The most "presentable" get the most popular "front-line" jobs and shifts. "Old ladies sell the merchandise, old men work in security. Haitian women work in housekeeping, Puerto Rican young people work in food services and preparation, African-Americans work as cooks or stewards or in food preparation" (Ellwood, 1998). Animal Kingdom, opened in April 1998, employs 50 Africans on 12-month contracts "to lend authentic flavour".

The rate of staff turnover is between 200 and 300 per cent a year. The Service Trade Council Union (STCU), a consortium of six unions, is the only workers' organisation recognised by the Walt Disney Company. It represents about 22,000 full-time and 5000 part-time workers at Disney World. In addition to concerns about wage scales and other conditions of employment, the STCU has concerns about the company's 'benchmark' monitoring system, based on maximising numbers using each attraction (Ellwood, 1998).

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