“If you’re in the business of making something, be in the business of making something great.”
On a Saturday in March 2005, Bob Iger called Steve Jobs. He had just been named the new CEO of The Walt Disney Company, and he felt like reaching out to Jobs because the relationship between Pixar (Job’s film studio) and Disney had fallen apart throughout the years. Iger has always thought Disney should buy Pixar, so he asked Jobs if there was any way they could work together again if things could be different. Jobs replied: “Well, I don’t see how things will be any different, but, sure, when the dust settles, be in touch.”
In 2006, Disney acquired Pixar for $7.4 billion, the first of many acquisitions aimed at growing Disney’s portfolio of franchises and money-making intellectual property. Bob Iger went on to acquire Star Wars, Marvel, 21st Century Fox…
The son of a manager and a teacher, Iger reached the top of the corporate ladder by climbing his way up year after year, starting as a television set assistant in 1974, and working for ABC. Promotion after promotion, he eventually became the head of ABC Entertainment, and then the CEO of its parent company, Capital Cities/ABC.
10 years after Disney bought ABC in 1995, Iger became the CEO of the whole group, in 2005. He retired in 2020 after 15 years of tenure and decided to focus on writing his memoir. In it, we find great lessons on what it means to be a great leader and the core principles he believes in. In this article, I thought I’d illustrate his examples with some of my own experiences as an employee at a startup that was acquired for $30 million.
“By fixating on a future job or project, you become impatient with where you are. You don’t tend enough to the responsibilities you do have, and so ambition can become counterproductive. It’s important to know how to find the balance — do the job you have well; be patient; look for opportunities to pitch in and expand and grow; and make yourself one of the people, through attitude and energy and focus, whom your bosses feel they have to turn to when an opportunity arises.”
It’s so easy to get impatient about a promotion you’ve been aiming for and call it quits because you can’t seem to get it. Iger knew that thanks to his long career at Disney he had a shot at becoming CEO one day, but he never knew when exactly it would happen. Before his promotion, the CEO of the company had been a guy named Michael Eisner, who had stayed in charge for the past 21 years.
I have witnessed ambition getting in the way of opportunity, and even progress, many times at my 9–5 job. I remember a colleague of mine who was complaining about not getting a raise (this was at a party where most people were starting to get tipsy). She had only started at the company a few months prior.
Over the next 2 to 3 years, she actually managed to get a bunch of nice promotions, and when we got acquired she played her cards well and changed department to yet another bigger role. She’s been doing great, but she recently announced that she had quit and would leave the company at the end of the month. Unless you’re unhappy with your job, there’s no good reason to do that. But she was too impatient to climb even higher, so she set her sights on another position at a different company. Unless she changes her approach to success and learns to be patient, she’ll probably get sick of this new position as well.
“As a leader you can’t communicate that pessimism to the people around you. It’s ruinous to morale. It saps energy and inspiration. Decisions get made from a protective, defensive posture.”
Bob Iger sums up the pessimism issue in leadership with a very simple vicious circle, illustrated as such:
Iger’s predecessor Michael Eisner was known for his pessimism, and it only got worse as the pressure mounted in the later years of his tenure. As Iger points out, “pessimism became the rule more than the exception, and it led him to lose ranks and become increasingly cloistered”
There’s no perfect way to handle stress as a leader, but if you let it get in the way of your decisions, it will be even more detrimental to your company. Many years ago, before we got acquired and even before the pandemic, our startup wasn’t doing too well. We were good at signing new customers but bad at keeping them after their contracts expired, and by the end of the year, we were bleeding money. It got to a point where investors became hesitant to pump in more cash.
Instead of giving in to stress and losing his cool, my CEO and his management team got together and decided to completely change the way we were doing things. They implemented the OKR strategy (Objective Key Results), a framework based on overarching long-term goals and consistent progress rather than hard, short-term targets. I’ve written about this strategy here and it literally saved the company. A little over a year after we started implementing it, my CEO sold his company for $30 million and retired at 48 years old.
“If leaders don’t articulate their priorities clearly, then the people around them don’t know what their own priorities should be. Time and energy and capital get wasted. People in your organization suffer unnecessary anxiety because they don’t know what they should be focused on. Inefficiency sets in, frustration builds up, morale sinks. You can do a lot for the morale of the people around you (and therefore the people around them) just by taking the guesswork out of their day-to-day life.”
Once it was announced that Michael Eisner would step down as CEO and the board was looking for a replacement, Bob Iger worked on an internal campaign to get support from as many board members and decision-makers as possible. Part of his approach was to outline 3 clear strategic priorities the company should rely on moving forward:
- Devote most of the company’s time and capital to the creation of high-quality branded content
- Embrace technology to the fullest extent, first by using it to enable the creation of higher quality products, and then to reach more consumers in more modern, more relevant ways
- Become a truly global company. Disney had a broad reach, but it needed to better penetrate certain markets, particularly the world’s most populous countries, like China and India.
The 3 priorities defined the company for the 15 years Iger was CEO, and they helped him make decisions and build a culture around a common vision. Here are examples of decisions Iger took for each strategic pillar:
- Some of Disney’s biggest blockbusters were produced during Iger’s tenure, in part thanks to the acquisition of Pixar studios.
- Disney+ was created to bring streaming to as many audiences as possible. It was a huge risk to take for the company because it meant pulling all its content from Netflix, losing hundreds of millions of dollars in licensing fees. In the long term, the bet paid off.
- One of Iger’s biggest projects during his tenure was the launch of the Shanghai Disney Resort in China, one of the biggest in the world.
Michael Ovitz was the company’s co-CEO for a few years at Disney. Bob Iger recalls having a meeting with him and having to sit outside for 45 minutes to wait for Ovitz to finish a phone call with Bill Clinton. Another meeting was interrupted by a phone call from Tom Cruise, and another one by Martin Scorsese. As Bob Iger writes in his memoir:
“Meeting after meeting was either cancelled, rescheduled, or abbreviated, and soon every top executive at Disney was whispering behind his back about what a disaster he was.”
It doesn’t matter if you have Tom Cruise, Martin Scorcese, or an “average Joe” employee at the end of the line. The best managers understand that time management is one of the most important components of running a successful company. If you have a meeting with someone, it is your responsibility to make sure it won’t get interrupted and you’ll be able to give the person your full attention. There’s nothing worse than making a person feel unimportant or unheard. They’ll walk away from that meeting frustrated, and most likely communicate their anger to their peers.
As an example, my CEO always gave full attention to whoever was in his office for a meeting, whether he was talking to a manager, a tech guy, or an intern. Even outside of the formal work environment, I remember having lunch breaks with him where he was fully present in the conversation and looked me straight in the eye to talk about his last weekend, a meditation retreat he had, or his daily run in the forest near his house.
Avengers: Endgame was Disney’s 20th Marvel film and had the most successful opening week in movie history. Taken together, those 20 movies have averaged more than $1 billion in gross revenue. The 5 Star Wars movies released by Disney have grossed nearly $5 billion. Under Iger’s tenure, the Walt Disney Company’s market cap grew from $48 to $257 billion, a more than five-fold increase.
It’s fair to say Iger’s tenure was successful for Disney, and the primary reason was not that he focused on making more money, but because he put the emphasis on company culture and was excellent at finding ways to broaden its reach.
“People sometimes shy away from big swings because they build a case against trying something before they even step up to the plate. Long shots aren’t usually as long as they seem. With enough thoughtfulness and commitment, the boldest ideas can be executed.”
Thanks for reading, and enjoy the journey.