Strategic Planning for Pixar

Strategic Planning for Pixar

in-depth summary

This report focuses on the requirement for strategic management that Pixar, the industry leader in animated art, must adhere to. The issues that led to the company’s decline in the film industry and the contributing factors will be examined. It will also consider any potential improvements that could help Pixar regain its standing in the movie business. It will also compare current movie production figures to historical business data and the yearly revenue made by these movies.

According to research on Pixar’s strategic management problems and how they affected the company’s annual revenue, the amount of new technology and creativity in a company’s films is directly related to its financial stability.  According to research on Pixar’s strategic management problems and how they affected the company’s annual revenue, the amount of new technology and creativity in a company’s films is directly related to its financial stability. The business, which had previously placed a high priority on film quality, neglected the value of quantity in generating profits and suffered as a result of their rigidity. The study explains how Pixar can develop their strategy by boosting creativity while maintaining the movie’s plot and other elements that keep audiences interested, and by introducing new technologies like 3D and CGI. The case study outlines Pixar’s initiative, led by Steve Jobs, to incorporate new computer animations into their films and how they attempted to increase the creative component by utilizing specialized software and computer systems. It also explains how Pixar dealt with intense competition and how the company took the necessary steps to deal with completion while maintaining quality.

With the aid of a SWOT analysis, potential solutions to the issues Pixar is currently experiencing are presented in this report, along with suggestions for improvements in productivity, creativity, and use of new technologies in their upcoming films.

Pixar’s Downfall

Jamal Shamsie and Alan B Eisner created the Pixar case study, which details the challenges faced by Pixar Animation Studios as they worked toward their objective. The first and biggest issue the company faced was the requirement for strategy formulation, and the second issue was a lack of human capital. Due to poor strategic planning, the company experienced numerous issues in its early years. Lack of strong leadership led to mismanagement and setbacks for the company. The company delayed the production of its films as a result of this lack of leadership, which also had an impact on the company’s reputation in the film industry. After the company was founded in 1975, it struggled for the first ten years to find its place in the movie industry because there were no full-length animated films available at the time. The company also had to deal with the current state of the market. As more competitors entered the market, Pixar’s value declined because they did not alter their practices or pace in the aforementioned sector. Their progress and market value were negatively impacted by their lack of a market strategy. We will conduct a problem analysis in this assignment and offer potential problem-solving strategies. We will go over how the strategies were put into practice and offer suggestions for the case.

Analysis of the issues

The issues Pixar was having were their declining market value, which was brought on by their lack of a future strategy and effective leadership. Their decline in revenues made the situation clear. John Lasseter was more concerned with quality than quantity, and he believed that investing the time and risk in making a good film was preferable to making a poor film that audiences would dislike. The Good Dinosaur’s initial release was delayed as a result of this issue. New strategies for the company’s future were developed when Steve Jobs acquired it, but his passing caused another setback because Jobs was the organization’s primary thinker and planner.

Strategic Planning for Pixar

Strategic planning for Pixar

We present our methods of strategy that Pixar can use to reclaim its place in the film industry in order to address the strategic management strategy. We consult Bacile, Ye, and Swilley’s marketing communication and distribution strategy for guidance. In order to ensure that the target market is happy with the product, companies can use this marketing strategy to conduct market research and develop their communication with the target market. By assessing the target market’s interest in the product and what they would like the product to be like, this type of communication tries to persuade them. In order to achieve this, Pixar must comprehend the audience for their films, their target market, and the favored new technologies. Since so many other companies have entered the market, product research is crucial to enhancing the caliber of their films. After the company’s demise due to the lack of capable leaders, Pixar must create its product strategy.

Solutions

Our suggested solution for Pixar’s demise includes better market research, higher-quality products, and potential industry advancements. An increase in quality is the first step in the problem’s solution. Although John Lasseter’s perception of the highest quality was undoubtedly advantageous to the business, it reduced the company’s revenue gains. In order to address this declining revenue, the company must recognize the needs of its target audience and quicken the pace of movie production. Viacom and NBC Universal, Pixar’s rivals, produce more films annually while Pixar places too little emphasis on quantity and instead prioritizes quality. Modifying the product to set Pixar apart from the competition may be the second-best course of action.

SWOT Analysis

Given below is the SWOT analysis for Pixar.

Strengths

Diversity in products

A good team of digital artists and motivators

Introduced the computer animation movies

Backup support for McDonald’s and Apple Inc.

Weaknesses

No advancement in movie quality in terms of technology

Less amount of movies are produced per year

No target audience research

Strategic Planning for Pixar

Opportunities

New video and social platforms for an increased marketing campaign (YouTube and Facebook)

3D and CGI technologies

Can use new methods of movie subscription

Can use famous celebrities to improve promotional strategy

Threats

Continuously advanced technologies

High Cost of Animation

Piracy of movies

Costs for using new technologies

We can see that one of the factors negatively affecting Pixar and leading to a decline in revenue is the lower number of movies produced each year. Pixar must constantly incorporate new technologies and creative content into their films in order to maintain viewers’ interest and persuade them to watch additional films after a positive moviegoing experience. Pixar can maintain their market’s interest in their films while producing more films annually, which will also increase their revenue. A definite need for time is the second way to advance movie technology. The competition uses cutting-edge techniques like 3D and CGI in animated films to make them seem more authentic.

How Pixar Can Achieve Its Lost Legacy

In Pixar’s creative program, the way these solutions are put into practice needs to be improved. Pixar already has a team of creative designers who work on stories, visualizations, and art, but the issue that needs to be fixed is the need for constant creativity improvement. We can see that Pixar now only produces two films annually, down from ten at one point. A team of skilled artists and simulation designers who can efficiently and effectively shape the script, story, and digital art into the best movie is something Pixar can find in new professionals and creative people who can brainstorm and produce new ideas for stories in less time.

Regarding Pixar’s financial structure, incorporating new technology into films can be challenging and risky, but we have observed that audiences enjoy new technologies like 3D and CGI, and they want to see more films with better picture quality and immersive experiences.

Strategic Planning for Pixar

The following advantages will accrue to Pixar as a result of increasing the number of films it produces each year using new and improved technology:

  • increased interest in Pixar films among viewers.
  • More films will bring in more money annually.
  • New technologies will guarantee a satisfied audience.
  • The popularity of the business will rise as a result of innovation and fresh ideas.

Conclusion

In other words, Pixar needs to improve its creative program if it wants to reclaim the reputation it once held. Due to its lack of long-term plans and inflexible standards for ensuring quality, Pixar, which was once the leader in the animation industry, reduced the number of films it produced annually and saw a decline in its earnings. It is now unavoidable for Pixar to develop new strategies due to the entry of new technologies and rivals in the animation sector. As a result, if a business wants to survive among enormous competitors, it must be adaptable to change and learn from its mistakes.

  • Market share, strategy, and human capital deficiencies
  • (Film sales are down, and as a result, a market is lost.)
  • Market portion
  • (Market share lost)
  • Strategy Development
  • (Pixar lacked a plan for the future.)
  • Managing Capabilities
  • (The company lacked the necessary management and skills)
  • Reasons
  • How did this occur?
  • Steve Jobs’s passing
  • lack of a clear goal
  • tough opposition
  • Undefined management positions
  • lacking senior management
  • inadequate managerial abilities
  • Solution?
  • No good movies are made.
  • The business lacked personnel for the management positions.
  • Solution?
  • To compete effectively, the business must adopt new technologies.
  • Solution?
  • There should be more films released each year.
  • With time, the income started to decline.
  • The business needs to bring on creative personnel who can work quickly and effectively.

Strategic Planning for Pixar

References

The authors are Artinger, F., Petersen, M., Gigerenzer, & Weibler (2015). Heuristics as flexible decision-making techniques in management. Organizational Behavior Journal, 36(S1).

(2016). O’Neill, J. W., Beauvais, L. L., and Scholl, R. W. An information processing perspective on the use of organizational culture and structure to direct strategic behavior. Journal of Behavioral and Applied Management, 2(2).

Pradhan, R. P., Arvin, M. B., Hall, J. H., & Bahmani, S. (2014). Causal nexus between economic growth, banking sector development, stock market development, and other macroeconomic variables: The case of ASEAN countries. Review of Financial Economics, 23(4), 155-173.