Have you ever wondered what it’s like to steer a multi-billion dollar corporation? Are you curious of what goes on inside the board meetings of a fortune-500 company? Bob Iger’s memoir: “The Ride of a Lifetime”, gives us a sneak peak at the inner workings of perhaps one of the most admired and well-respected American corporate entities in the world: The Walt Disney Company.
Simply put, this book was a triumph; a masterclass in leadership, strategic thinking, and emotional intelligence. Out of all the business books I’ve read - which admittedly isn’t that many - this was easily one of the most memorable and entertaining.
What makes this book so special? Well for one thing, it’s written by someone who has “walked the walk”. During Bob Iger’s tenure as CEO of Disney, the company’s market capitalization grew from $48 billion to $257 billion. He led four major acquisitions that all proved to be tremendously successful (Pixar, Marvel, Lucasfilms, 21st Century Fox). He took the company from a state of relative dysfunction and discontent in the early 2000s to the most successful, innovative, and modern media company in the world.
“We don’t have scale. The only company that has scale is you.” - Rupert Murdoch in a private conversation with Bob, subtly signal his intention to sell 21st Century Fox
“I never had more pride in Pixar than that day” – John Lasseter recalls after giving Bob a private tour of Pixar Animation Studio
“I love that guy” - Steve Jobs when his wife asked him if they could trust Bob Iger
His success as CEO of the Walt Disney company was not a fluke. The tact and emotional intelligence with which he carried himself every step of the way can only be described as dazzling. His forward thinking nature, his open embrace of technology, his optimism, authenticity, leadership were all key ingredients that built the foundation on which Disney enjoys its success today.
If your goal is to become a successful CEO, I hardly need to argue why this book might be of interest to you. Probably more so than one written by a self-help guru. Both can say platitudes like “innovate or die”. But one has led the transformation of a multi-billion dollar corporation, while the other is an author. Would you learn how to get into real estate from someone who’s never had any marked success in real estate investing? Would you learn tennis from someone who has never touched a tennis racket?
Another important note. You’d probably want to read this book in its entirety rather than a summary like this one. Although I do my best to distill the best and most interesting lessons/stories, inevitably some parts might still feel impersonal and trite. It’s really the specific stories Bob tells that makes advice like “be optimistic” have its depth and soul.
The story behind Pixar’s acquisition was utterly captivating. Having read Steve Jobs’ Biography, there were tons of overlap and I just loved flipping between the two books and getting each side of the story.
Reading Steve Job’s description of Bob Iger, then switching books and reading Bob Iger’s description of Steve Jobs. What a joy that was!
Some Context
To give a little bit of context. Prior to Bob Iger, the relationship between Pixar and Disney was extremely bitter and tenuous. Both Steve Jobs and Michael Eisner had huge egos and a long history of disagreements:
It was clear that Pixar was gaining swagger as Disney was losing it, and these two strong-willed personalities were destined to battle each other for supremacy.
Bob Iger inherited this dumpster fire. He then proceeded to masterfully repair the strained relationship, become life-long friends with Steve Jobs, and successfully acquire Pixar, all within the span of two years.
First Contact
Bob barely knew Steve at first. On the day he became CEO of Disney, he called Steve to let him know that he’d love to come see him and try to convince him that they could work together.
“Okay, well that’s cool for you”
“How long have you worked for Michael?”
“Ten Years.”
“Well, I don’t see how things will be any different, but sure, when the dust settles, be in touch”
Two months later, Bob reached out again, this time to talk about his love for his iPod, and his idea of “iTV”; essentially an iTunes platform but for movies and TV shows. Steve was silence for a while, then suggested that they meet in person. “I’m working on something I want to show you”
First Deal
When they met in person, Steve showed Bob the new Video iPod which will allow people to watch videos on their iPods, not just listen to music.
“If we bring this product to market, will you put your television shows on it?”
Bob knew there were many complications, but in the moment, he knew instinctively to say yes right away. Steve responds to boldness, and Bob wanted to signal to him that doing business with Disney will be much different going forward.
I thought that if he respected my instincts and my willingness to take this risk, then maybe, just maybe, the door to Pixar might crack open again.
So I told him again, yes, we were in.
Bob essentially brokered the deal himself within the span of 5 months. The speed and ease with which it was done blew Steve’s mind. From a passage in Steve Job’s biography:
“I’ve grown to like the guy.” He explained how easy it had been to make the deal to put ABC shows on the iPod, and added: “It’s night and day different from Eisner’s Disney. He’s straightforward, and there’s no drama with him”
Disney's Animation Trouble
“As animation goes, so goes the company”
At the opening of Hong Kong Disneyland, Bob realized the opening parade barely had any Disney characters from the last ten years. On the other hand, Pixar had become the de-facto best at inventive, sophisticated animated film making. They were also leaps and bounds above everyone technologically. In fact, according to their market research for women with children under 12, Pixar was a more beloved brand than Disney in a head-to-head competition. It wasn’t even close.
In an incredibly detailed, and blunt presentation to the board, Bob Iger stressed the importance of animation. How animation was the brand, and how other parts of Disney’s business is powered by it, including consumer products, television, parks, and etc. To fix Disney and revitalize Disney Animation, Bob proposed three options
The board knew the third option was unlikely given their history with Pixar. Even if they are for sale, the price would be wildly expensive. Bob believed that was the only way forward.
By then, the only bargaining chip Disney had was their rights to make sequels of some of Pixar’s earlier films.
“The reality was, Steve had all of the leverage in the world. […] Steve knew we would struggle to make anything genuinely great, though, given the state of Disney Animation, and he almost dared us to try”
"I Have a Crazy Idea"
About a week before the iPod Video announcement, Bob called Steve again and asked if they could meet in a day or two about “another crazy idea”. Steve liked radical ideas: “Tell me now”.
“What do you think about the idea of Disney buying Pixar?”
“You know, that’s not the craziest idea in the world”
He could not believe Steve was receptive to the idea. They met a few weeks later at Apple’s boardroom in Cupertino, in front of a 25 ft long white board.
They went through a Pro vs. Con exercise on the white board. Two hours later, the pros were meager and the cons were abundant. Steve wrote in all caps things like “DISTRACTION WILL KILL PIXAR’S CREATIVITY”. The only significant pros Bob thought of were that John Lasseter and Ed Catmull will have a much larger canvas to paint on, and that “Disney will be saved by Pixar and we will all live happily ever after.”
Steve can’t see how they can do this and asked Bob what’s next?
“I need to visit Pixar”
Visit to Pixar
The following week, Bob showed up at Pixar’s headquarter in Emeryville by himself. John Lasseter led him around the office. Throughout the entire visit, Bob was blown away by the creative energy as well as the films coming down the pipeline.
Bob was shown a virtually finished cut of “Cars”, as well as other films in the works including “Ratatouille”, “Finding Nemo”, “Wall-E”, “Up”, “Brave”, “Coco”, “Toy Story 3”, “Inside Out”. Every single film went on to win Academy Awards for best animated feature films…
I felt breathless as I described to Tom the level of talent and creative ambition, the commitment to quality, the storytelling ingenuity, the technology, the leadership structure, and the air of enthusiastic collaboration. It was a culture that anyone in a creative business, in any business, would aspire to.
John was equally overjoyed by the visit.
“I never had more pride in Pixar than that day. All the teams and pitches were amazing, and Bob was blown away.” – John Lasseter
Negotiation
The next day, Bob called Steve to talk about the acquisition. He tried to contain his enthusiasm, but as soon as he started talking, any semblance of a poker face had collapsed. He raved on and on about Pixar.
I hoped that my honesty would ultimately serve me better than any “shrewd” pretense anyway.
From Steve Job’s perspective in his biography:
“That’s why I loved Bob Iger. He just blurted it out. Now that’s the dumbest thing you can do as you enter a negotiation, at least according to the traditional rule book. He just put his cards out on the table and said: “We are screwed”. I immediately liked the guy, because that’s how I worked too. Let’s just immediately put all the cards on the table and see where they fall”
Steve told Bob that he would only consider it if John and Ed were on board. Bob assured John that the only way it makes sense for Disney to acquire Pixar was if they protected whatever it was that made their culture unique.
“It doesn’t make any sense for us to buy you for what you are and then turn you into something else.”
Disney acquired Pixar for $7.4 billion on January 24, 2006.
Afterwards, Steve and Bob became good friends. They enjoyed each other’s company immensely and it was a relationship where they could criticize each other, and one side could disagree, and neither of them took it too personally.
The End
Steve Jobs died of cancer a few years later. At Steve’s funeral, Bob retold the story of how Steve revealed to him that he had cancer on the day of Pixar purchase. He recalled how much Steve trusted him, how he shared this intimate, terrible knowledge because it might affect him and Disney, and how Steve wanted to be fully transparent.
After the funeral, Steve’s wife Laurene came up and told him their side of the story:
We were standing there with Steve’s grave behind us, and Laurene, who’d just buried her husband […]
“I asked him if we could trust you, and Steve said, ‘I love that guy’ “
Marvel
The successful acquisition and integration of Pixar into Disney snowballed into more opportunities and success. During negotiation with Marvel, Steve played a critical role by vouching for Bob Iger.
The next day, he called and talked with Ike for a while. I think even Ike was impressed, and flattered, to be getting a call from Steve Jobs. Steve told him that the Pixar deal far exceeded his expectations, because I’d lived up to my word and respected the brand and the people.
Disney acquired Marvel for $4 billion dollars in 2009. The marvel cinematic universe turned out to be a huge gold mine. In 2019, “Avenger: End Game”, just one film, grossed more than $2 billion dollars. Talk about return on investment…
21st Century Fox
The spectacular transformation of Disney under Bob Iger probably also influenced the sale of 21st Century Fox by Rupert Murdoch.
Shortly after the announcement of acquisition of BAMTech (which helped built the Disney+ tech stack), Bob received a phone call from Rupert Murdoch to come to his house for a quick chat.
Before their chat, there were some murmur that perhaps Bob was thinking about running for president
When Bob walked into Rupert’s home, the first thing Rupert said once they sat down was “Are you running for president?”
Bob was of course considering the possibility, but ultimately decided not to. For the next few hours, they talked about the threats to their respective businesses
the incursion of big tech companies, the speed at which thigns were changing, how much scale mattered. He was clearly worried about the future of 21st Century Fox. “We don’t have scale,” he said several times. “The only company that has scale is you.”
After their conversation, Bob could not help but think Rupert was subtly hinting at something unthinkable. The next day, he followed up with a call:
“If I am reading you right, if I said we are interested in acquiring your company, or most of it, would you be open to it?”
“Yes. […] [but] I would not do anything unless you agree to remain at the company beyond your curent retirement date.”
Thus came into fruition one of the largest acquisition in the media industry ($71.3 Billion…)
Interestingly, when Comcast got wind of the potential acquisition, and also made an offer that was actually higher than Disney’s. The whole series of event leading up to the acquisition was intriguing. Definitely have a read yourself. For example, after being out-bid, Bob secretly flew to London to meet with Rupert Murdoch:
“We reserved a room in a hotel in London that we never stay in, under different names. I don’t know if it’s true, but some people told us that Comcast sometimes tracks the movements of competitor’s private jet.”
After an alligator attack accident in Disney Orlando where a child died
“I wanted our response to come from me. I’ve seen other companies deal with crises by letting a “company spokesperson” be their official voice. That strategy has always struck me as cold and a bit cowardly”
“Corporate systems often work to insulate and protect CEOs. When you work in a corporate structure for so long, you become trained to give legalistic corporate responses”
As head of ABC entertainment in LA, Bob was extraordinarily sensitive and respectful to the creators
He argues that the creative process is NOT a science. Everything is subjective and there is often no right or wrong. However, it is important to acknowledge the passion it takes to be creative, and the need to be sensitive about a creator’s vision
“I am exceedingly mindful of how much the creators have pored themselves into the project and how much is at stake for them”
During his many years as CEO, Bob often notices people giving too much attention to him and not enough to his co-workers
For example, during a meeting from someone outside the company, that person will only look at him. This feels embarrassing to him and he makes a concerted effort to direct praise and attention to his coworkers as well
“I make sure to connect and speak with every person at the table. It’s a small gesture, but I remember how it felt to be the overlooked sidekick”
After finalizing the deal to purchase Lucasfilms, Disney went on to make its first Star Wars Movie. At the premier in Dolby Theatre, Bob made sure to pay respect to the George Lucas
“We are all here because of one person, who created the greatest mythology of our time and then entrusted it to the Walt Disney Company”
Firing people or taking responsibilities away from them is a hard but necessary role of a CEO. Bob has some recommendations for doing this properly
You have to do it in person and you have to look them in the eyes
You can’t use anyone else as an excuse. This is your decision about them - not as a person but the way they are performing their job
You should not make small talk. Be direct about the issues and explain clearly and concisely what’s not working
“There’s a kind of euphemistic corporate language that is often deployed in these situations, and it has always struck me as offensive. There is no way for the conversation not to be painful, but at least it can be honest.”
Before Bob Iger, Disney was generally seen as being in a lull in the early 2000s. There was wide-spread dissatisfaction with then CEO Michael Eisner. After Eisner’s resignation, many thought that perhaps Disney’s problem could only be solved by a “change agent”, someone from the outside. Internally, the only real candidate was Bob Iger. Everybody knew this, but Bob wanted to make it clear
“I’m asking you to write in the press release that I’m the only internal candidate”
The rationale for doing this is to have the board officially bestow some degree of power to him. If the rest of the company didn’t believe he was a serious candidate, he’d have no real authority
The self-awareness, and emotional intelligence to realize this is just amazing. He realized if he stayed quiet as the “next person in line”, he’s coming in from a position of weakness rather than strength. He needed to show his seriousness and that change is coming
“Handing the keys to the guy who’d been Michael’s number two through five of the most difficult years in the company’s history didn’t exactly signal a new day”
During Bob’s rise through the corporate ladder, he took on many roles for which he did not have the necessary qualifications. For example, he was appointed as head of ABC entertainment in LA, despite never having any experience in the creative industry. Having grown up in New York, he was a square peg in a round hole.
“The first rule is not to fake anything. You have to be humble, and you can’t pretend to be someone you’re not or to know something you don’t”
However, Bob admits that you can’t let humility get in the way of leadership. It is a fine line. Ask questions you need to ask, admit you don’t understand, then put in the work and learn as quickly as possible.
“There is nothing less confidence-inspiring than a person faking a knowledge they don’t possess”
A CEO must provide the company and its senior team a road map. “This is where we want to be”. “This is how we’re going to get there”. After taking reign as CEO of Disney, Bob landed on three strategic priorities
Efficiency vs. Collaboration.
Before Bob Iger, most if not all of Disney’s investments had to go through the “Strategic Planning Committee”. They build complex financial models and scrutinize everything with intense analytical rigor. The division was filled with Ivey League educated graduates. Bob believed they were too deliberative and slows things down too much for a company in need of transformation. Steve Jobs called it Disney’s “inner Gestapo”.
“Whatever we gained form having this group of talented people sifting through a deal to make sure it was to our advantage, we often lost in the time it took for us to act”
“This isn’t to say research and deliberation aren’t important. You have to do the homework” […]
“but you also have to recognize that there is never 100 percent certainty. No matter how much data you’ve been given, it’s still, ultimately, a risk, and the decision to take that risk or not comes down to one person’s instinct”
After getting rid of Strat planning, there was an instantaneous effect on morale. It was as if all windows had been thrown open.
He sees benefits to both an autocratic and democratic leadership style, and that one needs to be able to be flexible and apply both. Sometimes it’s worth talking through other’s reservation and respond to their concern. Other times, you need to communicate directly that you’re the boss. It depends on what you believe is right
Leaders must be optimistic even in the midst of crisis
When stakes are high, there is not much to be gained from putting additional pressure on people. Projecting your anxiety onto your team is counter-productive
When things are dire, look at each problem not as a catastrophe, but as a puzzle that needs to be solved
“As a leader you can’t communicate that pessimism to the people around you. It’s ruinous to morale. It saps energy and inspiration.”
Don’t let your ego get in the way of making the best possible decisions
When Bob became CEO of Disney, two major stakeholders sued the board for choosing him over other candidates. Bob recalled that he certainly could have gone to battle and prevailed, but that would have come at a huge cost. It would have been a giant distraction from what really matters, which is to set Disney on a new path.
“I can’t overstate how important it is to keep blows to the ego, real as they often are, from occupying too big a place in your mind and sapping too much of your energy. It’s easy to be optimistic when everyone is telling you you’re great. It’s much harder, and much more necessary, when your sense of yourself is being challenged, and in such a public way”
Let go when the time comes. Find the next person who will replace you.
“It’s not always good for one person to have too much power for too long […] It becomes harder to keep a check on how you wield [power]. Little thigns can start to shift. Your confidence can easily tip over into overconfidence and become a liability. You start to feel that you’ve heard every idea, and so you become impatient and dismissive.”
In 1985, Tom Murphy and Dan Burke bought ABC for $3.5 billion dollars with the help of Warren Buffett. ABC was now under the umbrella of Cap Cities and a swift re-org ensued. Dennis Swanson was brought in to manage ABC Sports Division. He lacked experience and many executives were displeased and resigned. Dennis brought Bob under his wing as senior VP of ABC’s sports programming. Reflecting on their success:
“It’s easy to imagine another person in Dennis’s shoes overcompensating for the fact that he’d never worked at a network by exuding a kind of fake authenticity or knowledge”
But that’s not the way Dennis was wired. If he didn’t know something in a meeting, rather than bluffing his way through it, Dennis would say he didn’t know. Dennis was the culture Tom and Dan created
“[Tom and Dan are] the most authentic people I’ve ever met, genuinely themselves at all times. No air, no big egos that needed to be managed, no false sincerity […] I learned from them that genuine decency and professional competitiveness weren’t mutually exclusive. In fact, true integrity - a sense of knowing who you are and being guided by your own clear sense of right and wrong - is a kind of secret weapon”
Stay humble. Don’t believe in your own PR
“Maybe this is the case for many of us: No matter who we become or what we accomplish, we still feel that we’re essentially the kid we were at some simpler time long ago. […] hold on to that awareness of yourself even as the world tells you how powerful and important you are. The moment you start to believe it all too much, the moment you look yourself in the mirror and see a title emblazoned on your forehand, you’ve lost your way.”
Innovate or Die
“Every traditional media company, while trying to figure out its place in this changing world, was operating out of fear rather than courage, stubbornly trying to build a bulwark to protect old models that couldn’t possibly survive”
The investment community only exacerbates this problem of stagnation. Investors punish companies for reducing profit under any circumstance, leading businesses to play safe and look for short-term gains rather than long-term growth
After acquiring the “big three” (Pixar, Marvel, Lucasfilms). Bob set his sight on technology. It was time for Disney to start delivering its content in new and modern ways. This was an incredibly intricate task as they would start cannibalizing their own still-profitable business. By skipping intermediaries, they are sacrificing licensing fees for major TV shows and movies
On relying on your intuition
“those instances in which you find yourself hoping that something will work without being able to convincingly explain to yourself how it will work - that’s when a little bell should go off”
For example, in the summer of 2016, Disney almost bought Twitter! The approval has been finalized. Bob Iger decided to pull out last minute because “something inside me didn’t feel right”
When giving feedbacks:
Don’t start negatively unless you are well acquainted and in late stage of production. Also don’t start small. Go straight to the point.
“I never start small. I’ve found that often people will focus on little details as a way of masking a lack of any clear, coherent, big thoughts. If you start petty, you seem petty. And if the big picture is a mess, then the small things don’t matter anyway”
Identify what matters most. It is inappropriate to be concerned about mice when there are tigers abroad.
“Avoid getting into the business of manufacturing trombone oil. You may have become the greatest trombone-oil manufacturer in the world, but in the end, the world only consumes a few quarts of trombone oil a year!”
In the creative industry, a program should always have a compelling narrative. Bob gives an example during his experience at ABC news under the tutelage of Roone Arledge broadcasting sport events
When it comes to handling public relation crisis
“Do what is right. Not what is politically correct, and not what is commercial correct. Just what is right”
Bob wakes up every morning at 4:30AM for selfish reasons. He likes to have the time to think and read and exercise before demand of the day takes over. He views this time as extremely vital; to create space and let your thoughts wonder
Don’t let your ambition become counter-productive. You need to be patient; do the job well; look for opportunities. Be the person that your bosses feel they have to turn to when an opportunity arises
“[be] the ones who are proving themselves to be indispensable day in and day out”
Say yes to every opportunity
“My instinct throughout my career has always been to say yes to every opportunity”
“Great” is often a collection of very small things