I think one of the biggest things that caused Chapek issues was loosing the backing of the cast and employees. You didn’t have to chat to people for long before the anti-Chapek sentiment surfaced, something almost unheard of in a company as orchestrated as Disney.
As a business relies on creativity in all avenues of its operation. But as soon as you start to constrain that, you’re playing with fire. Disney has seen in the past what happens when you tried to reduce the influence and funding of WDI and the studios, like the pre-Eisner era. It’s a fine balancing act but one that Iger seemed to have down. There were certainly questionable decisions along the way, but there was still a commitment to try and deliver the best level for the brand and guests.
On the flip side, while it’s true that Chapek was handed a bit of a poisoned chalice taking on the company as the pandemic took hold, his actions didn’t always seek to stabilise that. It suddenly felt like the company was in panic stations. We saw blanket price increases, reduction of offering, budgets and investments all slashed. Did Disney need to move forward and change? Absolutely. It really is interesting to note that, like
@jon81uk pointed out and experiencing it first hand the other month, Disney is actually cheaper on a number of fronts than Universal and SeaWorld/Busch. Food, drink, car parking, standard merch items, some of the added “experiences”. This couldn’t last for ever and rises were inevitable. But the way this was done really created friction and publicity that blew up rather spectacularly. There’s certainly better ways it could have been approached, such as staggering the rises. People aren’t daft and would have likely twigged what was going on, but it would have made it feel far less of a “pay more for less” than it has come across. This is the sort of thing Chapek’s tenure will be remembered for, for right or wrong.
On the pandemic note, it’s worth noting that Iger had reportedly offered to support with the transition to offer his experience in the wake of the pandemic, only to be aggressively rebuked by Chapek and told he didn’t need any help. The two supposedly didn’t speak again after that, even at Iger’s farewell party. It also tallies with accounts from others who worked with him in the past, saying how difficult he is to work with and how he has a habit of deposing anyone who challenges or threatens his authority. You can make of it what you want, but the sheer volume of these stories than surfaced from so many different areas does add some credibility and make it harder to ignore.
It’s also important to remember that Chapek didn’t just come in as CEO. He was previously the head of domestic parks and resorts, before moving up to oversee all parks when the domestic and overseas operations were bought under one leadership. So while there’s undoubtedly some elements that might be considered a hangover from the Iger era at least where parks and resorts are concerned, it’s also worth considering that Chapek was involved in some of these. You have to wonder how much more restraint there may have been if Chapek wasn’t in ultimate control. Genie+ didn’t happen overnight for instance. Yet it does feel like something that was suddenly rushed out to market soon after the change in leadership. How many of these “hangovers” were actually being sat on in preparation for the right time and messaging?
One thing that is swirling at the moment is the nature of this exit. Quite a few people have commented how unusual it is that:
- The announcement came on a Sunday evening outside of usual business hours
- He was removed mere months after the board had announced their confidence and renewed his contract for several more years
- Disney is on the eve of a key trading period, with thanksgiving and Christmas affecting parks and products enormously, and their latest films about to be released
It does seem a bit unorthodox, and is leading some to question if something has happened or been said behind the scenes which has triggered a sudden termination. Personally, I get the feeling it’s more that the share price has continued to slump and the board won’t want to be seeing a potentially profitable period marred by low share prices. But it’s certainly unusual.
