Bob Iger is Moving into a Higher Position at Disney
Iger is stepping down as CEO, and stepping up his power and influence
Yesterday, Disney announced that Bob Iger would be stepping down as CEO of The Walt Disney Company, allowing Bob Chapek to take his place effective immediately.
Stepping down isn’t really the right word though, since Bob Iger is stepping up into the brand new self-appointed position of ‘Executive Chairman.’
Iger has been running Disney as CEO for 15 years, a length that would seem an eternity at most companies, but a standard length for a CEO at Disney.
Chapek will now undertake the CEO role underneath the new Executive Chairman, who will undoubtedly still be calling all the shots.
Iger has previously mentioned that the CEO job is very demanding, so he’ll undoubtedly take this new job as an opportunity to take more time off work. He’ll be leaving the day to day operation of Disney to Chapek, while making sure to be there for critical decisions, future acquisitions, and government dealings.
The Executive Chairman
When looking around at companies that also hold an Executive Chairman position, Douglas Flint at HSBC stands out.
He’s considered the top-ranking person at the company, even above the CEO. He leads the board, and represents the company during its most critical meetings.
He’s not the guy who has to attend every dull board meeting (like a regular chairman). Instead, he’s the guy they bring in for the most important deals and decisions. This is the kind of role Iger is about to take on.
It seems to me that Iger is ready for retirement, but he’s not ready to let Disney go. Creating an Executive Chairman position allows him to still call the shots, but call them from the golf course more often than a stuffy office.
Unlike with previous CEO Michael Eisner, Bob Iger is not leaving the CEO because of mistrust and lacklustre earnings. Instead, Iger is leaving on a high after locking down the unbelievable and controversial deal to buy 20th Century Fox for over $70 billion.
Of everything he’s accomplished during his time as CEO, his acquisitions will remain what he is best known for.
Talk About a Shopaholic
Iger started his spending by buying Pixar for $7.4 billion in 2006 during a rocky time at the company.
Pixar’s relationship with previous CEO Michael Eisner had been falling apart, and for a while, it seemed as if Pixar and Disney would discontinue the distribution agreement they had at the time.
Instead, Iger replaced Eisner and smoothed the situation over, buying them out and assuming control of the studio.
He followed this decision with the 2009 acquisition of Marvel for $4 billion, another controversial move.
Marvel had just bet everything on their brand new studio and their first solo film ‘Iron Man.’
At the time, there was almost no investor confidence in Marvel’s ability to generate profit, especially since they’d spent years navigating bankruptcy court.
But Iger quickly turned things around and transformed Marvel into a powerhouse that now pumps out more billion-dollar films than anyone.
The next big acquisition took place in 2012, coincidently the first year I worked for Disney at Walt Disney World in Florida.
I still remember where I was when I heard the news. My workmates and I were chilling in the break-room and got a call from another break-room elsewhere in the park.
Disney had just bought Lucasfilm for $4.06 billion, and we were devastated.
My friends and I are enormous Star Wars nerds, and were sceptical that Disney would be able to make another film up to the Lucas standard.
We were right to worry.
The Future of Power
With all of that under his belt and the successful launch of Disney+, it feels right that Iger would pick now to settle down and move up to his executive chairmanship where he can rein from on high.
Other publications wonder what secret mistakes could have caused Iger to be kicked out more than a year ahead of schedule, but I don’t think that’s what happened.
I think Iger is going to spend a year proving his worth as Executive Chairman before pitching a new contract to the board that will grant him more time and a lot more money.
Iger’s replacement Bob Chapek is migrating to the CEO position from another job Bob Iger created.
Chapek’s former job was the recently created ‘Chairman of Disney Parks, Experiences and Products.’
My guess is that Iger created the position for him two years ago in preparation for his future role as CEO.
The company had originally lined up another succession plan that had fallen through in a boardroom shake-up.
Iger may have placed Chapek in his senior position at Disney Parks as a way to avoid any more embarrassing succession goofs.
Traditionally, moving someone into the CEO role of a company who isn’t coming from either a very senior position or a CEO role elsewhere can cause the stock price to tumble.
Even though Disney did this right, the stock price fell by 2.8% anyway.
Bob Iger is leaving his position with enormous shoes left for Chapek to try and fill.
During his tenure, Iger grew Disney’s market capitalisation more than $200 billion with good planning and enormous spending that paid off more than anyone hoped or dreamed.
No matter what Chapek does, it will be compared to what Iger achieved; and what’s worse, Iger will still be there to judge his every move.
Granted, he’ll probably be doing it from the golf course, but he’ll be there.