What kind of leadership does The Walt Disney Company need?

According to the tea leaves, Michael Eisner is on the way out from The Walt Disney Company sooner rather than later. Assuming this will happen within the next several months or few years, we must look beyond the days of Eisner and “his�? Board of Directors and consider the future of the Company.

So, what kind of leadership does The Walt Disney Company need?

To answer that question, we have to step back and consider that the Company is. The Walt Disney Company is a publicly traded corporation with an internationally revered brand name, a rich history, tens of thousands of employees (many of them highly talented), tens of thousands of acres in real estate, diversified media outlets, and a wealth of yet-underutilized intellectual property. First and foremost, the Company is an entertainment company. It is also involved in communications, news, sports, publishing recreation, merchandising, and other related businesses.

The name “Disney�? still means something to the general public, and it can continue to mean good things to the general public for generations to come if the Company cultivates, rather than excessively exploits, that name.

As a company, TWDC must make a profit to survive. As a publicly traded corporation, it must continue to be a worthwhile investment. The key is how TWDC should make money and increase in value. Companies exist to make money, not to make employees happy and keep their morale up, or even make customers happy. However, a company has the potential to make more money and increase in value if the employees are satisfied and dedicated, and the customers are happy and impressed. You can spend millions of dollars on “image�? advertisements, but you can be more effective and more efficient if you concentrate on being outstanding with your audience instead of just looking like it and talking about how you look like it. That audience will talk you up to their friends and family, and that’s much more effective than a television spot.

The Company makes money by entertaining. The public is much more willing to spend more money if they know they’re going to be well and uniquely entertained. Employees, artists, and contractors are more willing to work with and for you if they want to be associated with your name. Investors are more likely to pay higher prices to be part of the action if they see the value increasing because customers and associates are happy.

So where was I?

Oh yes- although there is some amount of continuity, this is a different company than the ones the Brothers Disney left behind. It is a different company than the one Michael Eisner and Frank Wells helmed in 1984. It is a different company than the one Frank wells left when he died too young in 1994. The Company had been arranged around the visions of Walt Disney, with his brother Roy running the business side. Walt moved from filmmaking to building Disneyland to community planning, letting experienced veterans keep things going in this established businesses (with his ultimate approval) while he concentrated on new areas.

Back then, the Company was the Studios in Burbank, WED Enterprises (now Walt Disney Imagineering) records, television shows, animation and other movies, Disneyland, the developing “Disneyworld�? project, and not much else.

Now the Company has multiple film, record, and publishing labels, cable television channels, a broadcast television network, radio networks, broadcast television and radio stations, websites, six major domestic theme parks (not including water parks), a cruise line, timeshares, hotels, and more.

I’m not going to use this edition of the column to discuss whether or not the Company needs to sell off or shutter some of its businesses. But even if it did, there would still be an awful lot to contend with in a world that is very different from 1966, 1971, 1984, or 1994.

The Board has taken the very nominal step of splitting the Chairman of the Board and the Chief Executive Officer positions.

Whoever will fill these positions in the future will need to be someone who understands the Company and what has made it enduringly successful, and why the shareholders have revolted now; someone who respects the past, because part of the Company’s success is about its heritage and nostalgia; and someone with visions for the future.

The Company is so big now that it can’t be successfully micromanaged from Corporate Administration. It needs strong creative leaders helming the various divisions, accompanied by management technicians who can actually back up the plans with resources. The visions and ideas should come first, the how and the unavoidable limitations should be considered second. Is something really impossible to do, or can the same result be achieved through another way? It is cheaper to build a less impressive theme park, but it is even cheaper not to build it at all.

Whoever becomes CEO should concentrate on representing the Company to the public, to governments, to other businesses, and to organizations. He or she should lead the Company forward, cheering on the cast and touting the Company to outsiders. The CEO can make sure the divisions work together instead of becoming fiefdoms.

The CEO must not lead the Company into new businesses and expansion of current businesses unless existing businesses are handling themselves well at their current size. Otherwise, quality will be compromised and resources stretched too thin.

A new CEO should know that the Company needs long-timers as well as fresh blood, and seek out the advice of those who actually care enough to offer it. Did you know Disneyland President Matt Ouimet has been walking around Disneyland Park before it opens on Saturday mornings, talking to front line cast members, asking them questions, checking on conditions, and actually taking notes? He actually follows up immediately with action. That’s the kind of thing I’m talking about.