In this scenario, a large film making conglomerate wishes to examine a number of potential film making projects. Each project is to be ranked according to its feasibility, measured by the ability to adhere to a number of corporate objectives. There are seven proposed movies to be judged and the conglomerate will produce four to six each year.
First is to examine each of those projects to the corporate objectives, compare and contrasting project selection criteria and justify why a project meets the selection criteria.
The corporation has three must have objectives as follow: All of the projects need to meet legal, safety and environmental standard, all of the film projects should receive a PG or lower advisory rating, all projects should not have an adverse effect on a current or planned operations within the larger community. The third objective is most probably in reference to the conglomerate plans to open theme parks in Poland and China which would be in addition to a number of existing parks, home videos, video games, theatrical productions and television channel. Each of those objectives mentioned will each be assigned a point weighting of 24 points.
This case study will also need want' objectives. These are assigned a weighting for their relative importance, however they are not critical to the company's mission.
Those want' objectives are as follow: to be nominated for and win an academy award for best Picture of the year, create at least one new animated character each year, generate additional merchandise revenue such as dolls, action figures, interactive games, music CDs, raise public consciousness about environmental issues, general profit in excess of 18 percent, advance the state of the art in film animation and preserve the firms reputation, finally provide the basis for the developments of a new ride at a company owned theme park.
As a member of the hypothetical team to evaluate each of the submitted proposals, the task is to rank each submission according to the corporate objectives, and to select films to be produced by the company.
Project Proposal 1: My Life with Dalai Lama
All of the corporate must have' objectives can be met by this project. It is unlikely to violate any legal, safety, or environmental guidelines. Aimed at a youth audience, it is probable that it would receive a PG or lower advisory rating.
Arundel Partners plans to pay to obtain a guarantee to the ownership of sequel rights for a set of films prior to production. It is assumed that only a small percentage of the films produced by a studio will be sequel candidates, based on the profitability of the initial film release. It is also recognized that the profitability of a sequel is typically lower than the initial release. This estimated profit will determine the proposed contract offer by Arundel Partners to the selected studio.
The two main issues in this case are the project analysis and financial forecasting. The project should be analyzed before doing the forecasting, because any recommendations on the project will affect financial forecasting for the next two years.
Star Appliance is looking to expand their product line and is considering three different projects: dishwashers, garbage disposals, and trash compactors. We want to determine which project would be worth doing by determining if they will add value to Star. Thus, the project(s) that will add the most value to Star Appliance will be worth pursuing. The current hurdle rate of 10% should be re-evaluated by finding the weighted average cost of capital (WACC). Then by forecasting the cash flows of each project and discounting them by the WACC to find the net present value, or by solving for the internal rate of return, we should be able to see which projects Star should undertake.
As can be seen in exhibit to solution 2, we have estimated the per-film value of each production company. MCA Universal, Warner Brothers and Walt Disney Co are the only production companies that provide a positive per film value, with values of 9.89, 1.92, 12.56 million respectively. This value is calculated by dividing the net present value of all the movies by the total number of movies. We also calculated the average value of each production company based upon their share of the total number of movies produced. The companies with positive values were MCA Universal, Warner Brothers and Walt Disney Co is also the only production companies that provide a positive per film value, with values of 1.40, 0.37, 1.40 million respectively. These values are based on the average value per film multiplied by the company's average share of the industry.
Now that we have a script, and we'll cut out the process of submitting it to movie studios, the next step would be pre-production. For this purpose, we'll use a fictional studio and call it L 0 L studios. This studio, after accepting the script, would hire a producer. Let's use a name here, like Richard Donner. His job is to hire a director, audition a cast, find a location to film, or decide if it can be done on a sound stage (possibly both), and try to keep it all under budget. Our director would be James Cameron, because with his success recently, his name alone would bring people to see this movie, which is the whole goal of the project. Casting is difficult, because certain factors have to be looked at, such as looks, (do they look the part?
Several implementation considerations are always talked about when talking about recommending and entire new strategy and needing to increase revenues. The entire movie industry has put in effort to fix the dying attendance/diminishing of the industry itself. Some of the common things that need to go into consideration that can cause problems include economic conditions, cultural preferences and differences, government laws/regulations, resources that include assets, people and capital. And the increasing of costs.
[1] Information was mainly taken from the Harvard Business Case Study “The Walt Disney Company: The Entertainment King”
Describe some ways in which business values and artistic values in Hollywood contend with one another.
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Moviemaking is a risky business, for it is not always profitable. Only one in ten films ever recovers its initial investment from theatrical exhibition. In fact, four out of ten movies never recoup the original investment. In 2000, the average studio film cost had a total cost of over $80 million per film. No other industry in the world risks that much capital to make, finance, produce ...
First you need to identify the organization’s internal and external resources, organization’s strengths and weaknesses as compared to its competitors and the opportunities it has for better utilization of resources.
The effects that comedies, action, and scary movies can cause to a person can be long-term or short-term problems. “A new U-M study shows that long-term effects can linger even into adulthood.” (DeGroat). Research also shows that these types of movies can result in health conditions, mental instability, and avoidance of real life situations that resemble what has caused the trauma. Issues such as inability to sleep through the night and obsessive thinking or talking about the frightening experience are commonly reported. Comparing “5 Scientific Ways Watching Movies Effects You” (Bengamin) and “Scary Movies Can Have Lasting Effects On Children And Teens”
The first and most crucial step is to create a solid plan. Plan should include the techniques, tools and data that are going to used in the project. The responsibilities of all the members should be distributed at this step. The utilization of resources and budgeting of the project should be done here. Management tools such as probability and Impact Matrix, FMEA are useful at this point.
Provide the short-term and long-term goals. What are the aspects to focus on immediately? What are areas will have to be addressed in the long run? How long will it take for the company to expand? When is the expected date of realizing the profits?
3. Analysis of the current organization and reporting structure by evaluating its strengths and weaknesses.