WHEN THE PHONE RANG AT ABOUT MIDnight on March 8 and Walt Disney Chairman Michael Eisner was on the other end, Dennis F. Hightower expected their conversation wouldn't be much different from others that they had had over the years. After all, since 1991 when Frank Wells appointed Hightower president of Disney's consumer products Europe/Middle East/Africa region operations, Hightower and Eisner had discussed strategy on many occasions.
But this conversation would be different. Disney was in crisis. In 1994, the company suddenly lost its president, Frank Wells, when he died in an April helicopter crash. Then in August of that year, Walt Disney Studios head Jeffrey Katzenberg left to form Dreamworks SKG with director Steven Spielberg and music executive David Geffen. Now in 1995, other key executives were defecting, among them, Richard Frank, chairman of Walt Disney Television and Telecommunications, who many credit with leading Disney to its present position as a television power.
The Television and Telecommunications unit, which includes network television, television animation, the Disney Channel, syndication, pay TV, worldwide home video and interactive media ventures, had become increasingly valuable since they were bundled into one division in fall 1994. Last year, riding the success of hits like The Lion King, the unit accounted for about $3.6 billion of Disney's $12 billion in revenues, and analysts expect the unit to be a major source of the entertainment giant's future growth.
By the time Frank announced his departure in August 1994, Eisner was battling a growing perception that Disney might be in decline. To counter that notion, he needed a star performer to fill Frank's position fast. Holding true to his style of avoiding the obvious play, Eisner dealt Hightower into the game.
"I assumed [the call] was going to be a discussion about who the replacement might be," recalls Hightower, 54. "But then he cut the conversation short and said he wanted me to take the job."
Hightower was on a flight from Paris to Los Angeles the next morning. He worked out an agreement with Eisner, had the papers drawn up and signed that same day--all before telling his wife, Denia, and two children. No doubt he used his gentle smile and an extra dose of charisma in explaining to her that they'd have to leave their expensive Paris home because you don't say "no" to the chairman. On March 10, less than 48 hours after he answered that call, he stood next to Eisner as the appointment was made official at an internal meeting.
Why would Eisner choose a man with no experience in the television industry to run the division that is perhaps the most important to the future of Disney?
"We chose Dennis eight years ago to run our consumer division overseas, and he exceeded our expectations, increasing our retail sales in his regions from $650 million to $4.5 billion," explains Eisner. "He's a proven performer who thoroughly understands the Disney brand."
Now, as president of Walt Disney Television and Telecommunications, Hightower is charged with expanding worldwide production, marketing and distribution of all Disney television entertainment. It's a complex job that involves managing the production of a broad array of quality programming, the creation of new interactive products and the development of distribution systems that currently do not exist. If he's successful, he will help Disney effectively redefine the entertainment experiences of millions of people all over the world, and boost the company's bottom line by billions of dollars.
"I've got superb creative executives in network TV, television animation and syndication, and I've got superb home video executives who know how to get products on shelves and how to talk to consumers," says the Harvard Business School graduate. "What Eisner wants me to do is bring all of that together in a different way and create a real opportunity for Disney in this new technological environment over the next few years,"
However, what Eisner wants is not the only thing that will determine what Hightower does for Disney. Former Creative Artists Agency Chairman Michael Ovitz, who jointed Disney as president in October, might want to restructure Disney's operating units and the roles of the executives who run them. While Disney officials won't comment on such speculation, all of Disney's operating divisions, including Hightower's report directly to Ovitz.
A GLOBAL COMPETITOR
Although Hightower's appointment caused internal rumblings and initially baffled some industry insiders, Eisner's forward vision couldn't have been more on target. The head of the Television and Telecommunications division must sell the Disney brand to a global audience because overseas markets have the greatest potential for growth. If Disney's proposed $19 billion merger with Capital Cities/ABC is approved, it will create one of the largest television distribution systems in the world, providing tremendous reach to capitalize on those markets. That's when Hightower's international experience will become invaluable.
Few executives at Disney understand foreign audiences better than Hightower. He has a trustworthy air about him, and under his leadership from 1987 to 1995, Disney's European publishing operations grew from 120 magazines and comics published in 16 different languages to 180 magazines and comics published in 28 languages in 32 countries. Last year, European sales for The Lion King sound track roared--a record 7 million audio cassettes and CDs were sold in Europe alone.
"He's eminently qualified to make business decisions," says Raymond Katz, senior managing director with Bear Stearns, adding, "The most important thing from an analyst's perspective is that the division hasn't skipped a beat."
Indeed. Little more than two weeks after his appointment, the stout, bespectacled former Army major was flexing his international muscle establishing the Disney Channel-Taiwan, the first Disney Channel outside the U.S. He followed that up with the October launch of the Disney Channel-United Kingdom while also inking a joint-venture deal that is the foundation for a future Disney Channel Germany.
Luckily, Hightower loves working on more than one project at a time, since his job demands nothing less. His work schedule is so intense that he routinely skips breakfast and lunch, sneaking bites of chocolate to keep his energy up until dinner. Yet, to make sure that he remains fit and energized, he never misses his daily swim. He's even careful to book only hotels with swimming pools when he is traveling on business.
Hightower has been working to lay the foundation for Disney's creative executives to flourish. In April, he helped negotiate a multimillion dollar joint venture with Ameritech, Southwestern Bell, Bell South Corp. and GTE Corp. Named Americast, the venture aims to provide interactive and traditional television programming through telephone lines to more than 60 million homes. Hightower is one of only two Disney executives serving on the managing committee. Then in July, he formed a new subdivision, Disney Televentures, which will deliver programming and content to Disney's four telephone company partners, as well as create a national marketing plan for them.
It is these kinds of projects that analysts believe are critical for Disney to stay in a leadership position. "They must take the idea of Disney and create a series of products--something compelling that would cause you to want to interact," says Richard T. Liebhaber, managing director of Veronis, Suhler & Associates, a New Yorkbased investment banking firm that specializes in media.
Among Hightower's priorities is the creation of the Americast "gateway" device that will introduce users to programming offered by Disney's telecom joint venture. Hightower says the project only allows Disney to "take part in the technology revolution, but to use this as an opportunity to create an industry standard."
THE ROAD TO DISNEY
Hightower is used to accepting nothing less than a leadership role. And he thrives on the challenge of change. "What gets my adrenaline going is the challenge of learning something new and different," says the Washington, D.C., native.
Somehow, Hightower has been able to combine his thirst for leadership and craving for change throughout his career. After graduating from Howard University, he joined the Army where the reached the rank of major by age 27. Following an eight-year military career, he worked for Xerox Corp. in 1970--the top copier manufacturer at the time--excelled and won a two-year fellowship to Harvard, the nation's top business school, After graduating in 1974, he was recruited by McKinsey & Co., the leading international managemnent consulting firm. "The McKinsey experience taught how to problem-solve," says Hightower, "how to put myself on the line to come up with what my client should do."
