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After what seemed an extended quiet period, there's been a whirlwind of news for Disney's Parks & Resorts division lately, what with the first layoffs taking out dozens of well paid executive positions in Team Disney Anaheim (TDA) last week.

The dust is nowhere near settled for the yellow and green building out back, and there's plenty more pink slips on the way for the lower management ranks in weeks to come. But at least a basic power structure is now taking shape and it's surprisingly promising not only for Anaheim, but for the resort visitor too.

Today we'll try and make sense of the TDA carnage for you and why it's good news for Disneyland, but first up we have a quick update on the overall Resort and how the original purpose for Walt's apartment in New Orleans Square has all of a sudden come back again.

Got that toaster pastry out of its wrapper yet? Have that coffee poured now? Well then let's get going shall we? - Al

Before we start...

A quick note is in order regarding the successful vote for one of the biggest unions at Disneyland. Last week the Cast Members who are part of the Teamsters Master Services union, the folks in key park departments like Attractions and Custodial and Stores, overwhelmingly approved their latest contract. The current contract wasn't set to expire until mid March, but the daily negotiations between Disney and the Teamsters union went very smoothly in recent weeks and were wrapped up early.

Their new contract grants a phased 12.5% pay raise to those Cast Members over the next three years and maintains Disney's standard health insurance benefits, in addition to some added perks to the vacation policies and extra money per hour for Cast Members working the big E Ticket attractions.

This is particularly interesting in light of the ongoing stalemate with the union over at Disney's Anaheim hotels where their contract expired over a year ago. The hotel union has continued to refuse to sit down at the bargaining table for months at a time, preferring to instead stage noisy public protests in front of the hotels in an attempt to anger paying hotel guests and make life difficult for the front desk managers handling the complaints. Disney's labor relations negotiators are now completely exasperated with the hotel union, and even the union leaders representing the park Cast Members have distanced themselves from the hotel union.

That this latest union contract for Disneyland and California Adventure (DCA) Cast Members was an easy slam dunk only seems to put more pressure on the hotel union to negotiate with Disney. Regardless of how one feels about union issues, let's hope the hotel union at least ends the noisy early morning publicity stunts on the sidewalk in front of the hotels that anger sleeping tourists who have saved up to take the kids to Disneyland.


The lights aren't much brighter there...

While the plans for the DCA makeover remain largely on track and fully funded despite the continuing downturn in the economy (contrary to inaccurate rumors elsewhere), some of the other plans for Anaheim expansion on and around Disney property have had their pause buttons hit in recent months.

Nowhere is that more evident than at Downtown Disney, where four separate retail spaces have all suddenly gone vacant within a few weeks of each other. Department 56, Club Libby Lu, Starabilias, and Illuminations have all been shuttered by their struggling corporate parents. Just like other malls around the country, these sudden closures took Disney's property management office by surprise. Those closures, along with some additional major tenants like Rainforest Café whose corporate owners are on very shaky financial ground, have put a dent in plans to expand Downtown Disney north into the surface parking lots beyond the monorail station.

What! No GAP?
More closed doors than the Haunted Mansion.

Downtown Disney was the sleeper hit of the Resort expansion in 2001, and the stylish mall instantly attracted big crowds of locals and tourists alike while DCA flopped and struggled to attract customers with discounts, cheesy marketing gimmicks, and free kids admission those first few years. Luckily the mall is owned outright by Disney, and they have the ability to backfill those newly vacant spaces with some of their own products.

First up in the replacement parade (and duly noted by Andy Castro in yesterday's Dateline Disneyland column) is set to be a new concept called Disney Studio 365, which is going to mirror the Libby Lu format fairly closely. This new glitter salon will be the slightly older version of the new Bibbidy Bobbidy Boutique opening this spring in Fantasyland, and will aim for the older sisters in the 10 to 14 year old demographic who have been gobbling up any pop music Disney Channel franchise that Burbank has cranked out in recent years.

Like Universal does with CityWalk, Disney is confident they can quickly fill in any vacancies, hopefully as soon as summer, as the remaining tenants continue to do gangbuster sales compared to other SoCal malls. But if bigger spaces like Department 56 or Starabilias can't be filled soon by the property managers frantically shopping the vacant spaces around, then Disney will be forced to chip in more of their own money and install Disney branded home furnishings or "lifestyle" stores as placekeepers there for the time being.


Suite: Dreams

Meanwhile, in the parks, John Lasseter can't seem to get enough of his latest company perk, the Disneyland Dream Suite in New Orleans Square. Any Disneyland fan knows this sprawling apartment home was originally built as a three bedroom suite for Walt and his grandchildren, but wasn't completed in time for Walt to occupy it himself before his sudden passing in late 1966. Remodeled and lavishly refurnished under a multi-million dollar budget for the second half of the Year of a Million Dreams, the apartment has largely sat empty since the marketing promotion ended in 2008.

Ding-dong: Pixar calling!
Lasseter Residence.

But now that the apartment no longer has lucky contest winners camped out in it every night, the Lasseter family has taken to using it as their home away from home when John needs a Disneyland fix. Disneyland Guest Relations now controls the use of the suite, and they are quickly growing accustomed to Mr. and Mrs. Lasseter checking in for a visit. Unlike most other senior Disney executives, the Lasseters clearly enjoy spending full days and nights in the park like any other family, although Dad seems to get the biggest kick out of the trips.

Anaheim managers over the last few decades had grown used to the occasional and strategically scripted visit by Michael Eisner or Bob Iger once or twice per year. Those brief corporate appearances are usually timed to specific media events and are pre-planned down to the minute, if not nano-second. At best, Bob Iger or Jay Rasulo might take a quick walking tour of the park to see a major new attraction, surrounded by top ranking TDA suits who nervously stick to their talking points and tight itinerary, with a nearby assistant constantly checking their watch to ensure the group isn't deviating from the approved schedule or route.

Anaheim actually sees more of the senior executives than Orlando does, obviously because of its close proximity to Burbank. For instance, Bob Iger has been attending the Disneyland Resort Cast Member Christmas Party in recent years, standing on Main Street as the party begins to pass out candy canes to thousands of arriving Cast Members and pose for pictures beside the Town Square Christmas Tree. On the other hand, until just recently Disneyland President Ed Grier was a no show when it came to spending unscripted time in the park, and most curiously only when an official TDA cameraman is present to capture the rare moment. But with the Lasseter family, it's simply a full day of going on rides, watching parades and Fantasmic, browsing the shops of New Orleans Square and Main Street, taking family photos in front of the empty lagoon at DCA, and just generally goofing off without a personal assistant in sight.

All mine, mine, mine!
The view from above.

Not surprisingly, being the Disneyland fan that he is, John Lasseter has quickly realized that the real fun happens after the park closes and everyone goes home for the night. Mr. Lasseter has been keeping both his Guest Relations minders and the night managers at the park smiling this winter as he heads out of the Dream Suite after park closing to wander the park and climb through the sets and back areas of his favorite E Ticket attractions to see for himself how it all works.

Now what Disneyland fan could blame him? Who hasn't dreamed of taking a flashlight to explore sprawling 1960's attractions like Pirates of the Caribbean or The Haunted Mansion in the middle of the night? The end result is that despite a few lapses in judgment (like his approval of small world's misguided "enhancements") many Anaheim Cast Members are growing even fonder of their number one fan, as it has been a very long time since any senior company executive actually shared a genuine and unscripted interest in the park and its facilities.

Walt and his family may have never been able to spend the night in the luxurious New Orleans Square apartment back in the day, but for current Anaheim Cast Members having John Lasseter and his family staying there is a happy 21st century use of the facility.


Suites: Executive

Obviously though, every day can't be a trip to Disneyland in the current economic climate, and Team Disney Anaheim has joined the rest of the Parks & Resorts division in laying off hundreds of senior executives. While no one wants to see someone lose their job, the silver lining here is that this TDA house cleaning was long overdue and desperately needed. The simple numbers speak for themselves with almost 100 Anaheim positions eliminated at the Director, Vice President and Senior Vice President levels. These are positions that started with healthy six figure incomes at the Director level, and rose higher when it came to the Vice Presidents and Senior Vice Presidents who then had perks piled on like lavish travel budgets and Company provided Cadillacs that were gassed up for free each week by assistants at the Disneyland service garage.

Up until last week, Disneyland alone had over 100 different Directors and nearly 25 separate Vice Presidents and Senior Vice Presidents. The made up titles for some of these folks were mind boggling, such as "Vice President of Business Insights", and many of them were hired over the last 10 years from other industries with no prior theme park or hotel experience. They typically spent their days memorizing their corporate psycho-babble talking points and trying to pretend they were an integral part of operating a theme park or a hotel.

Each of these Vice Presidents had their own little fiefdom to control in TDA, and many of them had only a tenuous connection to the actual visitor experience at Disneyland. Tellingly, before the mass layoffs, the average paying customer at Disneyland would only experience goods and services provided by five of the twenty five Anaheim Vice Presidents; those being the Vice President of Resort Operations (Attractions, Custodial, Security, Parking, and Guest Services), the Vice President of Resort Stores, the Vice President of Resort Facilities & Maintenance, the Vice President of Resort Food & Beverage, and the Vice President of Resort Entertainment. If that Anaheim visitor stayed in the Disneyland Hotel or shopped at Downtown Disney, they could add a sixth Vice President to the list, with the Vice President of Resort Hotels & Downtown Disney.

A headstone denotes where the bodies are buried.
Entering the Twilight Zone.

Even with all the above noted, that still left nearly twenty extra Vice Presidents working in Anaheim, all dutifully hosting PowerPoint shows and gassing up the free Cadillac as part of their effort to keep Disneyland going each day. Believe it or not, even with all of those extra executives Anaheim was actually running rather lean compared to Orlando. Prior to the layoffs, there were nearly 140 Vice Presidents working in Orlando alone, assigned to Walt Disney World and the Disney Cruise Line, several dozen of which were Senior Vice Presidents. And then there were the three hundred Directors spread throughout Walt Disney World and in office buildings in the nearby town of Celebration, waiting for their turn to be promoted to Vice President.

Now however, the new structure rolled out for the Parks & Resorts division has removed hundreds and hundreds of these executives, and left Anaheim particularly lean and mean. The executive focus now is no longer on the fancy Frank Gehry designed TDA building, but instead has shifted to, believe it or not, operating the theme parks and hotels that the paying customers actually visit Anaheim to see. Instead of dozens of Vice Presidents and hundreds of Directors all reporting to Ed Grier in a mish-mash of responsibilities and questionable productivity, Ed now has just four Vice Presidents and a handful of Directors reporting directly to him.

The new organizational structure has been purposely lined up to resemble the structure Anaheim had for most of the 20th century, until Paul Pressler arrived in 1996 and began mucking things up by adding on layers of extra executives hired from outside who were supposed to tell him how to run Disneyland. Each of the two Anaheim parks will now have a single Vice President who will have a handful of General Managers responsible for daily park operations and short term planning. The Hotels and Downtown Disney will keep their current Vice President, the very capable and well respected Tony Bruno. And finally, the Disney legal department will keep a Vice President in TDA reporting to Ed, with responsibility for Anaheim's risk management and legal issues in this litigious age. Sounds simple, right? It is.

The rest of the necessary functions supporting Disneyland, things like Public Affairs, Information Technology, or Marketing are all being lumped into a radically downsized "Domestic Steering Committee" made up of eight key Vice Presidents that will share key administrative responsibilities between Orlando, Anaheim, and the Disney Cruise Line. A few of the previous TDA Vice Presidents have moved to that new Domestic Steering Committee, and they will be keeping their office in TDA. But dozens and dozens of previous Vice Presidents and literally hundreds of Directors in North America have been eliminated entirely. Under this new structure the business of TDA's executives are now primarily to operate two theme parks and three hotels. That you would need to go through massive executive layoffs and a radical reorganization to get to that rational setup only proves how poorly structured and ridiculously bloated the Parks & Resorts organization was in the first place.

The really good news however is that for the most part these layoffs were very effective at removing people who had little to no understanding of what makes Disneyland special, and elevating or protecting those who have a strong understanding of how to keep the flame burning in Anaheim. For instance, the new top dog of the small group reporting to Ed is obviously the Vice President of Disneyland, who has the most General Managers reporting directly to him and is responsible for the flagship of the line for Parks & Resorts. Disneyland's Vice President, Jon Storbeck, began his career a quarter century ago as a ride operator in Fantasyland and worked his way up the ladder in nearly every operations department a paying customer would encounter. His new team of General Managers already knows him as a man who has Disneyland running through his veins, and he could find his way from the Matterhorn to Splash Mountain while blindfolded.

Where dreams go to die.
Where VPs lurk...

On the other hand, there's Mary Niven, the new Vice President of DCA, a woman hired by Cynthia Harris back in 2000 to help with the DCA expansion. While Mary is well liked by her immediate underlings and has been able to adapt to three very different Disneyland Presidents, she is rather unknown to anyone outside of the Food & Beverage department. But anyone who has had to suffer through an expensive and tasteless cheeseburger at Tomorrowland Terrace lately is not going to be a Mary Niven fan.

Niven has a smaller group of General Managers reporting to her, some sharing responsibility with the operation of the hotels and Downtown Disney, and it's unclear exactly how she is going to take to the day to day operation of a fast growing theme park like DCA. While Jon Storbeck is a proud Disneyland lifer, it will be interesting to see if she takes to broader theme park operations and decides to stick around. Regardless, the new streamlined structure has been designed to bring clarity and renewed purpose to the daily operation of the parks and hotels, something that had been too easily lost when there were dozens of Vice Presidents all fighting for attention and resources previously.

But those layoffs are not the end of it. Now that TDA's executive ranks have been slashed and burned and reborn from the ashes, the attention now turns to the ranks of middle and lower management in Anaheim. With departments being combined on both coasts, and even under the two new park Vice Presidents, there is a great deal of overlap and excess in almost all back of house departments in Anaheim. The same thing is now playing out in Orlando, which isn't being helped by the fact that many functions that the Californians were doing better or more efficiently, such as the creation of parades and park entertainment, are to be consolidated in Glendale and Anaheim. And then there are the big elephants in the room, sprawling departments like Human Resources and Public Affairs, that are rumored to have many of their major functions outsourced entirely, effectively wiping out entire office floors on both coasts.

There's also some additional restructuring coming for the new park Vice Presidents, like the dismantling of the Outdoor Vending department that was greatly expanded by Paul Pressler in the late 1990's. The Outdoor Vending carts in the parks are now planned to be supervised by the nearest park restaurant, instead of being managed by a separate team of Directors and managers that had grown into their own sprawling empire in far flung offices.

Hockey pucks have more flavor, and are easier to chew too.
You can't escape ODV.

Ed Grier hosted several information sessions for all salaried Cast Members regarding all of these changes in recent days, and his PowerPoint script included some rather blunt and serious talk. Those staring at the new org charts on the screens could realize that most people not working for a front of house operations department were going to be under some intense scrutiny. The words "Guest Experience" and "Operations" were repeated on all of the key slides, phrases that too many folks in TDA know nothing about. It was implied that if you're a salaried Cast Member who doesn't report to one of the new General Managers now running the daily operation in Anaheim, it's time to 'dust off your resume'. Ed very clearly stated that "massive change" and "radical" restructuring would be sweeping through the middle management ranks in the next 60 days, with many more "eliminated positions" to be the result.

In a world where Disney managers have become accustomed to soft politically correct blather from their executive leaders, those strong words were very sobering. There won't be voluntary severance packages offered to those managers in advance however, just a tap on the shoulder and an empty box for your personal belongings. Ed did say that the layoffs need to be decided upon quickly and the dust should settle soon, and that the Anaheim managers remaining would surprisingly be getting a merit-based salary increase in April. Still, the layoff target is now aimed squarely at the cubicles and offices of TDA, with a smaller amount of layoffs to also hit a few of the managers out in the parks and hotels.

The executive layoffs that happened last week, and the swelling number of layoffs to come in March, are clearly the most sweeping and tumultuous headcount reductions in Disneyland history. While the loss of all of those white collar jobs is also a blow for the local economy, especially for the much smaller / less affluent Orlando community, it is change that was long overdue.


So much more to cover...

While there's still plenty of good stuff coming to Anaheim in the next few years, we'll just let the above sink in for now. Barring unforeseen developments, we'll be back next Tuesday with some upbeat news for DCA and, yes, even some new things headed for Disneyland.

 

Oh-kay - that should do it for today. Remember your support is vital. Since Amazon ended their Honor System and the ad market is soft, your donations to PayPal help keep the bills paid. We're only here due to all of your kind efforts.

Keep in mind updates only get posted when there is something to report on, and not before. It takes time to confirm things, and even then we can only offer a snapshot of a continually evolving story. Just like the happiest place on earth, patience is a virtue; the queue may take a while before you can enjoy the attraction. ;)

See you at Disneyland!

Al Lutz may be e-mailed at [email protected] - Please keep in mind he may not be able to respond to each note personally.

© 2009 Al Lutz


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