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The Walt Disney Company and Pixar Animation Studios Inc.

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Transcript of The Walt Disney Company and Pixar Animation Studios Inc.

The Walt Disney Company and Pixar Animation Studios Inc.
Perceptual errors & Cognitive biases
Ethics
Parties
Disney' Goals
Trust dilemma
Disney: Truth dilemma & Trust dilemma
Avoid inner discomfort.
They did not want to create conflict.
Most important party: Pixar

Disney: Negotiation Style
Pixar' Goals
Susana Giraldo, Ma. Valentina Álvarez, Valentina Taborda, and Cristina Cadavid
Each party's negotiation style
What type of information will each party need?
Situation were parties encounter me
Personalistic
Disney: Ethical model
• Halo-effect:



• Selective perception:
Sources
Alcacer, J. (2009, March 02). Harvard Business Review. Retrieved November 04, 2014, from http://hbr.org/product/the-walt-disney-company-and-pixar-inc-to-acquire-o/an/709462-PDF-ENG
Cámara de Comercio de Medellín para Antioquia. (2013). Retrieved Noviembre 04, 2014, from http://www.camaramedellin.com.co/site/Cluster-y-Competitividad/Comunidad-Cluster.aspx
Fried, I. (2006, January 24). CNET News. Retrieved November 04, 2014, from http://news.cnet.com/Disney-buys-Pixar/2100-1026_3-6030607.html
Grover, R. (2006, January 23). BloombergBusinessweek. Retrieved November 04, 2014, from http://www.businessweek.com/stories/2006-01-23/disney-pixar-its-a-wrap
Holson, L. M. (2005, October 31). For Disney and Pixar, a Deal Is a Game of 'Chicken'. The New York Times , p. 1.
ICMR. (n.d.). Retrieved November 04, 2014, from IBS Center for Management Research: http://www.icmrindia.org/casestudies/catalogue/Business%20strategy/Business%20Strategy%20Disney's%20Acquisition%20of%20Pixar.htm
Jensen, K. (2013 ). The Trust Factor: Negotiating in SMARTnership. Palgrave Macmillan.
Nutresa, G. (2012). Grupo Nutresa. Retrieved Noviembre 01, 2014, from http://www.grupochocolates.com/es/webfm_send/275
Pixar. (2012). Retrieved November 09, 2014, from http://www.pixar.com/about
The Walt Disney Company. (n.d.). Retrieved November 09, 2014, from 2014: http://thewaltdisneycompany.com/about-disney/company-overview
The Walt Disney Company. (2014). Retrieved November 04, 2014, from http://thewaltdisneycompany.com/about-disney/leadership/board-of-directors




Merger of
Disney & Pixar

¨Pixar Animation Studios has created acclaimed animated feature and short films for over 25 years. Pixar is also home to the RenderMan line of software products.¨-Pixar.com
¨The Walt Disney Company (...) is a leading diversified international family entertainment and media enterprise with five business segments: media networks, parks and resorts, studio entertainment, consumer products and interactive media.¨-Thewaltdisneycompany.com
Goals' interconnection
Assumptions
Disney: Assumptions, Perceptions, & Expectations
Pixar: Assumptions, Perceptions, & Expectations
To move forward in the industry by over-passing the pen-and-ink industry.
To win back the glory of its past in the animation industry.
To distribute Disney's content over the Internet through iTunes.
To own Pixar.

Pixar: Truth dilemma & Trust dilemma
Pixar: Negotiation Style
Disney & Pixar: Behavior & Way to Talk
Pixar: Negotiation Team
Disney: Negotiation Team
Disney: Sources
Pixar: Sources
Search Disney structure and work methodology as a corporation.
Acquire information of Disney’s finances and main competitors.
Make a previous review of publications about Disney and how crow see it as a corporation.

Previous negotiations between Pixar and Disney
- Toy Story
- Bugs Life
- Toy Story 2
- Monsters Inc.
- Finding Nemo
- The Incredibles
Pixar's shares Wall Street.
Research on what other companies want to buy Pixar and what are the offers.

Pixar: Perceptual errors & Cognitive biases
Disney: Perceptual errors & Cognitive biases
Cognitive biases
Solving dilemmas the correct way.
Act by: rules, moral principles and moral law.
Always in benefit of both parties.
Be in good terms with their business partner.

Pixar: Ethical model
Expectations
Perceptions
Working with Pixar will have a proactive and successful outcome.>Previous relation & works with Pixar.
Pixar main choices came down to selling out the company>The negotiation did not mean that Pixar will sell itself to Disney.
Assumptions
Perceptions
Expectations
Truth dilemma
Truth dilemma
Trust dilemma
Team motivations: Social motivation
Perceptual errors
• Projection: Negotiation needed to be delayed, Iger was very bother.> Pixar was frustrated & bother.
• Stereotyping: Team members believe that arrogance have become the principal identifier of powerful men. >Steve Jobs equal to Donald Trump.
• Winner's curse: Disney did quickly the negotiation.>Team members felt discomfort.
• Anchoring & adjustment:
Perceptual errors
Cognitive biases

Overconfidence:
Pixar believes that Disney surely has to buy them because they are pioneers in animated movies; but they have to face competition and the developing technology.

• The law of small numbers:


Disney: Clothes
Pixar: Clothes
Executive Chairman of the Board, Chief Executive Officer
Independent Director
Pixar wants to be part of the Disney’s family entertainment brands and assets.
Disney noticed that Pixar's are in-house

Increase profits due to their great technology Pixar has.
Attract kids from the new era; increase rating on T.V
Regain position in the market.

Yielding
Ok with any price Pixar wanted. >Twentieth Century offers 8 billion dollars for Pixar.>Disney offered 7 billion dollars.

Rules-ethics
Robert A. Iger
Susan Arnolds
Steve Jobs
John Lasseter
Executive Vice President
Chairman of the board
Disney is not sure that Twentieth Century was offering plenty of benefits.>Strategy of Pixar to acquire desirable benefits.
Disney commented a few explanations to acquire Pixar.> Disney did not its decreasing profits .
The merger between Disney and Pixar was an amazing example of how a negotiation can see as a partnership contribution and how both parties can get a benefit from each other, even by being in the same industry.
They based the negotiation trough a goal that was to get united to produce high quality animation for next generations; due to the magnitude of the bargaining, both companies were able to increase the size of their profits, Pixar will released two films in the coming year and Disney expanded it audience by capturing Pixar market.

Declination of traditional hand-drawn animation.
Ownership of the creativity.
Unparalleled opportunity to Disney.
Availability of Disney’s resources.

Pixar did not know until what point show how interested they where in the negotiation and they clarified that they had potential buyers but no preferences.
Pixar had an investigation group that searched the information that it may needed to know about Disney, this group found that Disney’s shares were decreasing their price and maybe that was why the interest of Disney.
Resources
Distribution Fee
Expansion
Brand Image
Innovative
Competitive Advantage
Rating
Bob Iger
Steve Jobs

To acquire Apple's technology increasing the digital content in Disney movies.

Problem-Solving
Underlying interests
Potential Solutions
Satisfaction of goals and needs
Pro-social, open-minded
Questions, offers and counteroffers
Casual black or colorful
Rigid
Conservative
No understanding
Decisions based on institutional values
Fulfilling employee's needs
Preserving innovation.
Steven P. Jobs (Chairman of the Board)
Edwin E. Catmull (President, Chief Executive Officer and Director)
Alvy Ray Smith (Executive Vice President, Director)
William Adams (Vice President of Sales and Marketing),
Charles F. Kolstad (Vice President of Manufacturing),
Richard B. Wood (Vice President, Chief Financial Officer)
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