Walt Disney Corporation

Introduction:

The purpose of this paper is to evaluate the competitive position of organizations in a given industry and assimilate that information in the form of a Competitive Profile Matrix. Walt Disney Corporation has been chosen for this exercise. Monitoring competitors' performance and strategies is a key aspect of an external audit. The method deployed for the purpose of evaluating competitors' performance and strategies is Competitive Profile Matrix. The main competitors for Walt Disney Company are Time Warner and News Corporation. As a part of this paper, we have evaluated the firms on seven Critical Success Factors to form a Competitive Profile Matrix. We have explained the step-by-step process to design the Competitive Profile Matrix. Lastly, we have also critiqued certain limitations for deploying this tool for external audit without any regards to the inter-related aspects such as values and goals of the firms.

'Competitive Profile Matrix' (CPM) identifies a firm's major competitors and their particular strengths and weaknesses in relation to a sample firm's strategic position (David, 2007). The critical success factors in a CPM are broad in nature and they are not restricted to specific or factual data and even may focus on internal issues. The critical success factors in a CPM also are not grouped into opportunities and threats, but they are listed in an order. Ratings are assigned and total weighted scores are calculated to be compared with the sample firm in CPM. This provides internal strategic information which is important for the firm.

The Competitive Profile Matrix can be developed in five steps as explained by David (2007);

1. List all the critical success factors which include both internal and external issues.

2. Assign to each factor a weight that ranges from 0.0 (not important) to 1.0 (very important). The weight indicates the relative importance of that factor to being successful in the firm's industry. The sum of all weights assigned to the factors must equal 1.0.

3. Assign a rating between 1 and 4 to each key external factor to indicate how effectively the firm's current strategies respond to the factor, where 4 = the response is superior, 3 = the response is above average, 2 = the response is average and 1 = the response is poor. Ratings are based on effectiveness of the firm's existing strategies.

4. Multiply each factor's weight by its rating to determine a weighted score.

5. Sum the weighted scores for each variable to determine the total weighted score for the organization.

The Competitive Profile Matrix has been developed in Figure 1, and compared with its competitors Time Warner and News Corporation as below. The Critical success factors are Market Share, Financial Position, Experience, Advertising, Low-Cost Strategy, Resources and Innovation. Walt Disney Company's major competitors are Time Warner and News Corporation. Walt Disney is recognized as a market leader in experience and innovation. It also does a great job in advertising and making its low-cost strategies work effectively in its favour. However, Time Warner has a stronger market share and a sound financial