Phenomenal Complexity Theory and Change at Disney:

Response to Letiche:

David M. Boje

For CITATION, please use: Boje, D. M. (2000). Phenomenal Complexity Theory and Change at Disney: Response to Letiche. Journal of Organizational Change Management, Vol 13(6): 558-566. What follows is a pre-publication draft.

Abstract

 

This article develops an example of Letiche's article on phenomenal complexity by contrasting academic research projects that have contradictory findings concerning Disney. Some academics think Disney is unfairly critiqued while others think that Disney escapes. Phenomenal complexity theory is used to explain the disparate results.

Key words: change, storytelling, complexity, chaos.

 

I have been invited by Janice Black to reply to Hugo Letiche's essay, "Phenomenal Complexity Theory and Bergson, its precursor." My charge is to connect the phenomenal complexity theory (PCT) to change management and to give an example. My response assumes your familiarity with PCT.

The new metaphors of complexity theory include emergence, self-organization, complex adaptive systems, strange attractors, bifurcations, 'edge of chaos,' and fitness landscapes. The essay focus on the over-rationality and reductionism of science, particularly complexity science (i.e. Stuart Kauffman & John Holland) and its preference for reductionism (reducing self-organizing to non-cognitive) and to rationalization (dualizing subjective and objective experience, with a preference for the later). The only example (a good one) is the relationship of PCT to music and the bulk of the essay is en elucidation of Bergson's phenomenological concepts of the conscious experiencing of time (dureé, intuition). Letiche's argument is that while supposedly "anti-mechanistic," complexity theory is being theorized and practices according to what I will call the three R's of logical positivism:

What Letiche's essay does is challenge the 3R's with inclusion of a fourth decidedly postmodern "R."

Letiche concludes that (1) social systems are in constant state of change and complexification (as well as their opposite counter-acting loops); (2) knowing the parts in depth does not able us to predict the direction or development of a complex system; (3) phenomenal complexity is rich in inductive, sense-based knowledge processes; and (4) there is a plurality of valid cognitive and experiential modes of knowing rather than a unity. With this too brief summary, I turn to an example.

Disney and Phenomenal Complexity Theory (PCT)

So how does Letiche's article help us? I would like to develop one example (give the space allowed) of a multinational corporate that dances on the edge of chaos. While Disney Company is rated high on reputation for friendly, helpful employees, it is being drawn into more and more controversy in the last decade (Nakra, 2000: 36-37). A growing number of boycott groups, from the Christian right to Labor and anti-sweatshop activists on the left are attempting to affect Disney consumer's consumption habits and investor's choices of corporate stock. This is partially accomplished by staging web and street protests that are negative to Disney's reputation: "the most significant consequence of a negative corporate reputation is the adverse effect on share price and market capitalization" (Nakra, 2000: 35). My thesis is that while no one protest is having measurable impact, the combined effect of an informal network of affinity groups is having a strategic and financial impact on Disney.

Disney Corporation is flirting not only with phenomenal complexity, but chaos by walking the razor's edge between courting traditional family entertainment values and reaping the income niches in global capitalism special interest groups find problematic. Christian fundamentalist groups have networked together to boycott Disney films, books, tapes, TV, and theme parks over family values concerns. In addition, in separate efforts, anti-sweatshop groups as well as a myriad of cultural groups who have been offended by Disney in one way or another are boycotting. Disney to these groups, but not to the public at large, is the corporate equivalent of Dr. Jekyll and Mr. Hyde. And if any of the charges and allegations stick to the image of Disney, then we can say that this corporation risks tumbling into the abyss.

In response to this risk, Disney must spend corporate advertising dollars to re-erect its image as a socially responsible and friendly company. Disney's reputation is part of its "synergistic strategy," to have a hit film, manufacture toys and garments related to the film, move the theme to TV shows on stations owned by Disney, set up a ride in a Disney theme park, and sell the wares in Disney stores and parks. What is obvious from a review of Disney in the news, is that the synergy strategy gets into increasing trouble each year because of the emergence of higher orders of phenomenal complexity. For example, sometimes one part of the Disney Empire seeks to protect the interests of another part, and the corporation accused of something as controversial as censorship:

Megamergers lead nicely into the issue of corporate censorship. For example, Disney buys ABC and uses it to promote its films and cartoons, but at the same time, ABC's documentaries on issues such as theme park security run the risk of being pulled if they reflect badly on Disney" (Fahy, 2000: 115).

If such charges persisted and caught the attention of the FCC, then Disney risks the same fate as Microsoft (to be broken up).

Disney has a long reputation of being anti-union that extends back to the days of Walt Disney, and the corporation continues to draw union activist attention. Elliot (1993), for example, contends Walt Disney is a radical right-wing anti-unionist. Boje (1995) describes how Walt used family metaphors to contest unionization. On May 29, 1941, 293 employees went on strike. The Disney studio's public image as "one big happy, harmonious family" was shattered by 1,000 picketers and pursued by media stories of dysfunction: unfair salaries, poor work conditions, and a parochial code of behavior. Walt's employees were growing skeptical of the family metaphor. To this day, one can question the "happy family" veneer of Disney under the leadership of its current CEO, Michael Eisner. A number of union and fundamentalist groups, for example, in the last decade accuse Disney Corporation and its executives of erosion of family-centered and conservative corporate values since Michael Eisner took over from Walt Disney (and Walt's son-in-law, Ron Miller). For example, Stabile (2000: 199) asserts that the expose and boycott efforts of the:

Disney Store by labor activists like the National Labor Committee, journalists like Bob Herbert, and activists like the Pittsburgh Labor Action Network for the Americas (PLANTA) is a strategic move that works to make visible some of the very contradictions discussed. Their purpose is not to boycott… Disney's popular Pocahontas doll (made by Haitian workers for eleven cents an hour-half of Haiti's already pitiful minimum wage... because such a boycott would only encourage consumers to buy other products likely to have been made under similarly exploitative conditions. Rather, their purpose has been to bring such relations of production into consumers' range of vision by singling out those corporations who sell their products on the basis of social responsibility, decent family values, and other nonsense, while at the same time engaging in labor practices that give the lie to their public propaganda.

And the company that brought the world Mickey Mouse is in hot water with both labor groups and pro-democracy activists over its connections with a garment assembly plant in Burma (Corporate Watch, 1996). In another example, "Seventeen year-old women are forced to work 9 to 10 hours a day, seven days a week, earning as little as six cents an hour in the Keyhinge factory in Vietnam making giveaway promotional toys--especially Disney characters--for McDonald's" (Source http://www.nlcnet.org/mcdisalt.htm). Many activists contrast Eisner's salary with the lowest paid worker's wages. Eisner for example made $576 million in a year when Vietnamese 17 year old girls making Disney toys seven days a week were paid 17 cents an hour, and Haitian workers making garments received 30 cents an hour (National Labor Committee, 2000; Corporate Watch, 1997; Salon News, 2000, Shapiro, 1997).   And Cutler Corporation, a Disney subcontractor pulled production out of Haiti after bad press to relocate 2,000 the lost jobs to China (National Labor Relations, 1997). While union boycotts want to use sales boycotts as a leverage to increase poverty wages, it does not want to lose jobs. On the other hand, the fundamentalist boycotts have been aimed at curtailing sales of all Disney products and services.

Disney is also being boycotted by religious groups such as the Catholic League, several Baptist and Charismatic groups, Church of God of Cleveland, Tennessee, Assemblies of God, The International Church of the Foursquare Gospel and The Presbyterian Church in America (PCA) (For List See http://falcon.laker.net/webpage/aaleading.htm and http://www.linda.net/boycott2.html). At issue is the way Disney products are perceived as violating church doctrine and ethics. For example, a Disney subsidiary, Hollywood Records, produces songs by heavy metal singer Danzig, whose music features satanic themes, according to information provided by Texas Family Association (1997). A pension fund group wants Texas schools to dump Disney stock over this. A rider to the 1998-99 appropriations bill prohibits state agencies from investing in companies that own 10 percent or more of a business that records or produces music glamorizing or advocating violent criminal acts, illegal drug use or perverse activities. (See web site http://www.lubbockonline.com/news/070397/group.htm or site http://newsaskew.com/tboe). As yet, the boycott has not had a measurable impact on Disney stock values.

Complexity is more than the sum of the study of parts.

At issue in complexity theory is the idea that the sum is greater than the parts. This translates to a possible stock effect in the combination of protests that is not discernable in the analysis of any one action. There are four areas that make Disney a complex and dynamic system that could register such combined dynamic effects.

First, the changes gripping Disney are the product of complexity, a system of forces and counter-forces. As the number of groups boycotting Disney increases, Disney is not able to make a move in its global corporate empire without drawing itself into yet another controversy. For example, Disney is being boycotted by anti-homosexual groups in a kind of "Gay McCarthyism." First, Disney extended company benefits to the same-sex partners of its homosexual employees. Second Disney hosts an annual Gay and Lesbian day celebration at the Magic Kingdom. Third, Disney books (Hyperion Press), movies (Touchstone & Miramax), animated moves (in "The Little Mermaid" a scene depicts a priest becoming noticeably aroused while presiding over a wedding), and TV (ABC) has more gay and lesbian characters than its rivals (Retrieved September 11, 2000, from the World Wide Web: Little Mermaid scene, http://www.banzai.net/sublime/disney/merm2E.JPG). Fourth, Michael Eisner, Chairman of the Walt Disney Company, Michael Ovitz, President of the Walt Disney Company and Joe Roth, Chairman of Walt Disney Motion Pictures, all serve as members of the Hollywood Supports Board of Trustees. Hollywood Supports is a pro-homosexual group whose focus is to promote the homosexual agenda (Retrieved September 11, 2000, from the World Wide Web: http://www.linda.net/factpage.html; See also http://www.afatexas.org/document/boycotts/disney.htm). 

Disney is also being boycotted by pro-family values groups (e.g. Focus on the Family and American Family Federation). They each contend that Disney since Eisner is seen as encouraging a life style which founder Walt Disney would not. For example, the first change Michael Eisner made after becoming CEO, according to Disney manager Spencer Craig, was to remove a certain motto from business cards. That motto was "We create the finest in family entertainment." The family values police monitor each Disney movie looking for any scene that violates their ethical code. For example, in a scene from " Who Framed Roger Rabbit" Jessica Rabbit is ejected from a crash while riding in the taxi, and in the scene, she has no panties. In another well publicized incident, "Disney hired Victor Salva, a convicted child molester, to direct its movie "Powder". When Salva's victim, Nathan Winters (now 20), publicized the hiring, some of the police officers who investigated the 1987 molestation said they were incredulous that Salva was working again as a movie director." ( Both scenes retrieved September 11, 2000, from the World Wide Web: http://www.linda.net/factpage.html).

Finally, Disney is a complex enough empire that it manages to offend almost every cultural group. Disney is being boycotted by African Americans "Disney Pictures has yet to create animated films featuring African-American characters (other than having them portray animals)" [Retrieved September 11, 2000, from the World Wide Web: http://www.laker.net/webpage/african.htm].   Disney is also being boycotted by a coalition of Arab American organizations for an exhibit at Florida's Epcot Center. The coalition alleges the Israel Exhibit, which opened October 1st, 2000 "distorts fact and history by presenting Jerusalem as the capital of Israel" (Retrieved September 11, 2000, from the World Wide Web: http://www.muslims.org/webnews/messages/97.html). Finally, Disney is being boycotted by Native American groups for its portrayal of native Americans as seen in their movie "Pocahontas" [For more information, refer to the web site for the Rankokus Indian Reservation http://www.powhatan.org]. 

Who is in Control in a Complex Network?

It can be argued that Disney is weathering the myriad of protest movements without substantial loss of sales of stock investments. "Disney boycott failed miserably-Baptist kids are as good as non-- Baptist kids at pestering their mommies to see Hercules" (Confessore, 2000: 10). Yet, I would assert that Disney is increasingly hard to manage, subject to complex adaptive forces, emergent processes of protest, self-organizing networks of labor and family value monitor groups, and operating seemingly on the very edge of chaos. Seemingly minor issues combine across many groups to create ripple effects that become major news controversies. In short, the protest movements operate separately but combine in dynamic action to produce proverbial butterfly effects to Disney Corporation and its executives.

Disney uses its resources to balance protest news with its own coverage. For example, Discover magazine is a division of Disney Magazine Publishing. It promotes the Disney dinosaur exhibit and a Disney film on the topic. "The process of laying muscles over the skeletal frame was vital to the success of Disney's Dinosaur movie" and even comment on the aesthetic value " Disney's dinosaurs follow a different example, quite popular in dinosaur art" (Weed, 2000: 74).

Yet at every turn there is another controversy. Toysmart was majority-owned by The Walt Disney Company in Burbank, California that caught much media heat for the proposed sale of its customer list. This became part of a high-profile debate about whether the federal government should pass privacy legislation or continue allowing companies to regulate themselves (Rosencrance, 2000: 6). It is getting so that at every Disney venture there is protest:

The opening this week of the $800 million wildlife park in Orlando, Fla., was touched by the kind of controversy that accompanies nearly everything Disney does these days. Investigators examined whether federal law had been violated in the recent deaths of cheetahs, hippos and rhinos at the park. The probe cleared Disney, but that didn't stop a small contingent of picketers from waving signs. Disney rivals, meanwhile, began calling the park "Minimal Kingdom," because a few visitors said they didn't see as many animals wandering through the recreated African savanna as they had expected (Orwall, 1998: B1).

In 1994, a multitude of intellectuals and Virginia residents protested the Walt Disney Company saying it must relocate a planned theme park "Disney's America" to a "less controversial" site in Virginia (Turner, 1994: A3). The park was never built. The point of listing these incidents is to show that at every turn the Disney executives must watch their strategic footing and guard their every word. An action is gist for the boycott mill.

Postmodern Culture and Disney

Disney operates in what I call "Tamara" (Boje, 1995). In Hollywood, a play called Tamara puts the audience in a special relationship with an experimental fiction. In Tamara a dozen characters unfold their stories before a walking, sometimes running, audience. Instead of remaining stationary, viewing a single stage, the audience fragments into small groups that chase characters from one room to the next, from one floor to the next, even going into bedrooms, kitchens, and other chambers to chase and co-create the stories that interest them the most. If there are a dozen stages and a dozen storytellers, the number of story lines an audience could trace as it chases the wandering discourses of Tamara is 12 factorial (479,001,600).

To me, Disney is TAMARA, a global mansion with plays in every room, and activist-spectators chasing executives from room to room. But, since no one can be on every simultaneous stage at once, many "truths" float freely. As Letiche puts it, there is a good deal of relativism. There are as many "truths" for Disney and its critics as there are different experiential possibilities in the Magic Kingdom. Ironically, in the many rooms of the Disney Empire, no one truth gets established for long. We know there is going to be another controversy and it can pop up anywhere at anytime. While there is a multiplicity of perspectives on Disney, there are enough watchdogs (and witch-hunts) to put behavioral and strategic constraints on Disney strategy. Everything does not go down well with the consumer and labor boycott groups. And some readings of Disney have more media-power and more staying power.

I would agree with Letiche on these points. Disney as a social and economic system is in a constant state of change and increasing in complexification. Knowing the parts of the Disney-synergy system does not allow us to predict the next outburst of complexification. There is a plurality of valid cognitive and experiential modes of knowing rather than a view that holds unity and political correctness within and outside the Disney Empire.

Disney is the author of hyperreality but is still the modernist story machine (i.e. a theme park run on conveyor belts) and in some cases uses feudal labor in Asian factories. There is a good deal of illusion put to economic purposes. "Disneyland functions as an 'imaginary effect' concealing that reality no more exists outside than inside the bounds of the artificial perimeter" (Fjellman, 1992: 301). In terms of phenomenal complexity, Disney is able to able to convince most of its publics that its illusions are the real thing, and that critics are over-zealous or over-reacting. Yet, as I have attempted to illustrate, the Disney Empire does react to its critics and the complexification is growing to the point where a little ripple can cause a tidal wave.

 

Conclusions

In terms of change, there is a self-organization happening to Disney and among the critics that network to protest corporate strategy. My application of Letiche's phenomenal complexity theory does not abandon the idea of complex material conditions, such as subcontracting network dynamics in production and distribution chains. Indeed it is the contrast with material conditions and the reality of Disney theme parks and films that keep this corporation on the verge of spinning out of control. In this circle the phenomenal complexity has its intertextual-relation to the material conditions of labor. Objectivity and distance are illusions.

Change is a constant at Disney and consulting to Disney involves working through the phenomenal complexity dynamics that makes piece-meal-consulting efforts not only obsolete but potentially dangerous. Without an appreciation for complex dynamics, the risk is that a simple-sounding intervention will unleash a story of protest and one too many and Disney tumbles into the abyss.

References

Boje, David M. (1995) Stories of the storytelling organization: A postmodern analysis of Disney as "Tamara-Land" Academy of Management Journal. 1995, Vol. 38 (4): 997-1035 http://business.nmsu.edu/~dboje/papers/DisneyTamaraland.html

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Marx, Karl. 1867. Capital: A critique of Political Economy. Volume I. The Process of Capitalist Production. Translated from the 3rd German edition by Samuel Moore and Edward Aveling. Edited by Frederick Engles. Original publication NY: L. W. Schmidt. NY: International Publishers, 1967 version.

 

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National Labor Relations (1997). Cutler Corporation, a Disney subcontractor pulled production out of Haiti after bad press to relocate 2,000 jobs to China. Retrived from the web on September 12, 2000: http://www.nlcnet.org/disney


National Labor Committee (2000) "McDonald's/Disney Linked to Six Cent-an-Hour Sweatshop in Vietnam." Web Document http://www.nlcnet.org/mcdisalt.htm 

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