Conflict at walt disney case study

Within every organization there is some type of conflict, whether the conflict is personal, organizational or emotional. But the key is to manage the conflict so as to not hinder the profitability, functionality or public image of the company so that it is viable competitively. In the case of the Walt Disney Company, although the company had conflict within the organization, this did not hinder its competitiveness.

The company still was able to compete, even with the public knowledge of its conflict with the company’s owner Michael Eisner. What is important to understand about conflict is that there are several types of conflict, there are different stages of conflict and conflict can be managed or resolved. Types of Conflict “Conflict can be functional or dysfunctional in terms of how it affects a company”, according to the authors of Organizational Behavior and Management (Ivancevich, Kinopaske, & Matteson, 2011).

The authors also define functional conflict as a confrontation between groups that enhances and benefits the organizations performance, while dysfunctional conflict is a confrontation or interaction between groups that harms the organization or hinders the achievement or organizational goals (Ivancevich, 2011). The specific conflict at the Walt Disney Company between Michal Eisner and Weinstein brothers as well as Steve Jobs fall within both these categories.

For example, according to an article written in Fortune , “The feuding with the Wienstein brothers and Eisner cost the Disney franchise $100 million dollars, the Miramax franachise owned by the brothers is estimated to be worth $2 billion dollars; This is a good deal for Disney” (Sellers, 2005). Although, the conflict was public in its nature and cost the company money; which defines dysfunctional conflict, the conflict between the brothers and Eisner over finances, still was able to enhance the portfolio of the Disney company; making this a functional conflict concept as well.

In fact “Functional conflict can lead to increased awareness of problems that need to be addressed, result in broader and more productive searches for solutions, and generelly facillitate positve change”(Ivancevich, 2011). For example, with Miramax added to Disney’s long list of acquistions, this enabled them to move into the Independent Film Industry, which was a change of pace from what the Disney Company is known for. In the long run, this public fued, along with the one involving Steve Jobs, gave the Disney Company a chance the address the concerns of its CEO’s abrasiveness with others. Conflict with Steve Jobs.

The feud with Michael Eisner and Steve Jobs was also a public one. It also falls within both functional and and dysfunctional conflict. Even though the conflict was a of very public nature and almost cost Disney its business relationship with Steve Jobs, which by definition makes this conflict a dysfunctional one; this conflict can also be considered a functional one as well. The Disney Company’s acquisition of Pixar from Steve Jobs was beneficial financially to Disney. According to Sellers, “Pixar, by feeding Disney an uninterrupted string of animated hits, provides 15% to 30% of the studio’s operating income annually” (Sellers, 2005).

Stages of Conflict Normally there are several stages of conflict individuals pass through when dealing with intergrop conflict; percieved conflict, felt conflict and manifest conflict. In the feud between Michael Eisner and Steve Jobs the stage that best describes their conflict level would be felt conflict. Felt conflict involves emotion, and usually manifested by anxiety, tension, or hostility. Steve perceived that Michael insulted him and his Apple company by making accusations of piracy.

Steve moved into the felt stage of conflict when he felt insulted and did not forgive Michael for his public comments, so much so that he threatened to not renew the partnership between the two of them with Disney-Pixar. But the good news is that in order to move to a resolution conflict, according to Ivancevich, “All parties to a conflict need to experience both perceived and felt conflict to be sufficiently motivated to attempt resolution” (Ivancevich, 2011). Conflict Resolution Managing conflict for organizations is very important in maintaining business relationships, especially ones that are profitable like that of Disney-Pixar.

At the helm of the Walt Disney Company during the begging and end of these feuds was Michael Eisner and Bob Iger. Even though Michael Eisner is the one responsible for the conflict with Disney and Pixar, he should be equally responsible for trying to fix the damaged relationship. When trying to manage conflict there are several approaches that can be taken to resolve the conflict at hand: dominating, accommodating, problem solving, avoiding and compromising. Eisner’s Style. Michael’s style of conflict resolution can be described as dominating.

The dominating approach to conflict resolution involves using its power over the individual to force them into a resolution that is only beneficial to their interests. Being that Eisner has held some sort of power over the parties involved, such as controlling budgets of the involved parties or having a hierarchical position within the company, such as the CEO, he uses this type of approach to solve resolutions. Iger’s Style. Bog Iger’s conflict resolutions style can be described as problem-solving. Problem solving involves resolving conflict by placing focus on both parties concerns.

For example,When he took over as CEO of Disney, he reached out to repair the relationship between the Weinstein brothers. He recognized that the this particular relationship would be only helpful to the company in the long run, so he decided to find a solution to the problem for the financial benefit of the company. He was also a problem solver when he repaired the relationship with Steve Jobs. This enabled the Walt Disney Company to be able to buy Pixar while adding Steve to the Board of Directors for the Walt Disney company. Iger’s approach to conflict resolution only enhanced the business relationship with that others.

Competitively, Iger has positioned the company to reap benefits that other companies can’t attain in this economic downturn of today. Conclusion Throughout the conflicts between Walt Disney Company and the Weinman Brothers and Steve Jobs, the company has had two CEO’s: Michael Eisner and Bob Iger. While Eisner’s management style was a bit more abrasive than that of Iger, both Executives were able to move the Disney corporation into ventures that were profitable while still maintaining a competitive edge in the business. Being able to manage conflict is important for a business to be successful and competitive in today’s market.

Understanding the types of conflict, stages of conflict and approaches used in conflict management is a useful tool to have upper and middle management utilize in getting a company back on track to the everyday functions of the company.


Ivancevich, J. M. , Kinopaske, R. , & Matteson, M. T. (2011). Organizational Behavior and Managerment. New York: McGraw-Hill. Sellers, P. (2005, March 21). Fortune. Retrieved February 12, 2011, from CNN. Money: http://money. cnn. com/magazines/fortune/fortune_archive/2005/03/21/8254816/index. htm

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