By Ronald Grover It didn't take Bob Iger long to put his imprint on Disney (DIS). Scarcely two weeks after being selected to succeed Michael Eisner as Disney CEO -- and six months before he's scheduled to take the job -- Iger engineered a restructuring of Disney's strategic planning operation. That move brought cheers from Disneyites who have long complained that the company's complicated process of decision-making stopped too many new ventures from moving forward. Now, the individual units will do their own planning, with former head of strategic planning Peter Murphy becoming an adviser to Iger.
So far, so good. Iger clearly has a touch for settling the sometimes turbulent waters at Disney. But his next announcement will be far more important: his choice of who will succeed him as president. Word inside the Mouse House is that he'll tap Tom Staggs, Disney's chief financial officer. Staggs is an able financial expert but probably not the Disney faithful's first choice for the job.
ONE ACE GUY. Iger probably doesn't need my advice -- and he certainly isn't asking for it. But I'm going to offer some anyway. If he really wants to overhaul Disney's sometimes stifling corporate culture he ought to pick Dick Cook, the likable chairman of the Walt Disney Studio.
After 34 years with the company, Cook is as close as anyone on the Burbank lot comes to being Mr. Disney. A former college baseball player, Cook's first job in the organization was operating steam locomotives at Disneyland. He eventually ran the theme parks' marketing department and thrust Disney into the cable-TV world in the late '70s by developing what would become The Disney Channel.
Cook ran Disney's distribution and marketing operations for years, and he has generated more than $1 billion a year in box-office revenues for the studio since getting the top job in 1996. Heck, Cook even met his wife, Bonnie, when the two worked at Disneyland together.
A LURE FOR PIXAR? More important, Cook would give Iger one of the few things Iger lacks: the allegiance of Hollywood producers, a key thing for a company that lives and breathes by the content it creates. Indeed, Cook is known as one of Hollywood's nicest guys and would be crucial to restoring some of Disney's lost luster in the talent-relations department (see BW Online, 12/5/03, "The Nicest Guy in Disney's Jungle"). "If you can't work with Dick Cook, you can't work with anyone," says film producer Jerry Bruckheimer, who says he works with Disney in large part because of his affection for the studio chief.
Moreover, if Cook were elevated it would likely go a long way to helping Iger strike a new deal with the studio's top partner, Pixar Animation (PIXR), which is scheduled to depart in 2006 after 12 years of making films for Disney. One reason for the split is the open hostility Pixar Chairman Steve Jobs has for Eisner. By contrast, Jobs spares no opportunity to express his affection for Cook during nearly every Pixar conference call, and the two sat together at this year's Oscars.
More important, having Cook as president would almost certainly stop Disney discontents Stanley Gold and Roy Disney in their tracks. Gold and Roy Disney are contemplating a proxy fight to unseat a majority of the Disney board for selecting Iger, who was Eisner's hand-picked successor. As former board members, they both know and like Cook, according to knowledgeable sources. The dissident duo appreciates his link to the company's culture and his ability to create Disney-like content. Indeed, to Gold and Roy Disney, Cook is the anti-Eisner.
EFFECTIVE EXEC. Still, Cook may not get the job. The Disney rumor mill has the spot locked up for Staggs, in part because he enjoys the support of two of Disney's most influential board members, Northwest Airlines (NWAC) Chairman Gary Wilson and Clorox (CLX) Chairman Robert Matschullat. Both admire how Staggs kept costs down in recent years when Disney was hurt by an ailing theme-park division and the serious ratings decline at the ABC network.
Now that Disney looks to be on the mend, thanks in large part to strong performances by those two divisions, Staggs should be sharing some of the credit with Iger. Indeed, Staggs's efforts to rein in costs have been so effective that Disney's margins nearly doubled in 2004, when it reported an 85% hike in net income, to $2.34 billion.
Even though the heavy betting is on Staggs, Disney has other possible candidates. One is Anne Sweeney, who as co-chairperson of the media networks unit oversees ABC and Disney's fast-growing stable of cable channels (with the exception of ESPN). Also said to be in the running is Andy Mooney, who heads Disney's consumer-products unit.
TOO NEW? Both have strengths. Mooney, a long-time Nike (NKE) executive, is considered a strong manager and has overseen a 39% hike in operating earnings at the consumer-products unit in the last year. He gets credit for his brilliant job of marketing the Disney Princess Line, a collection of Disney female characters that has become a $2 billion retail property.
Sweeney, who worked at Nickelodeon and Fox before joining Disney in 1996, also has strong ties to the creative community. More important, she has succeeded at nearly every stop, bringing strong original content to the Disney Channel, launching foreign channels, and even beefing up ratings at the ABC Family Channel.
Both Mooney and Sweeney have extensive international experience, and Iger has made no secret that he's targeting overseas as a growth opportunity for Disney. But Mooney has been at Disney for only five years, and Sweeney was put in charge of ABC just a year ago. Iger may want her to stay there in the hope of keeping the ratings revival alive.
Iger no doubt remembers that Disney worked best in the early Eisner days, with Frank Wells as the CEO's No. 2. They had complementary talents: Eisner was the creative force, Wells was the organization man. Iger, despite five years as head of ABC's prime-time schedule in the late '80s, is more of a manager than a creative executive. That's why he should choose Dick Cook. And the Disney insiders would cheer a No. 2 who's also a link to the company's glory days as an American icon. Grover is Los Angeles Bureau Chief for BusinessWeek