Case Study: Hollywood Motion Picture Industry

Introduction
Hollywood Motion Industry accounted for 71% of US motion picture and 60% of the nations TV show production. Major activities included studio projects, studio-backed independent projects and negative pickup deals controlled the procurement market in the industry. Project based supply chain. Multi-layered of contracting for hiring crew, directors, actors. Costs of casting, negotiations, agents and lawyers fees formed substantial portion of the film.

Case Facts
Due to project based, the loyalty between supplier-buyer is missing. Studio backed independent projects -high risk. Short term coalition with little consideration for long term loyalty. Limited supplier base, reputation for fair dealing prevalent and opportunistic behavior- unacceptable. Inter-firm & interpersonal competition a key driving force. Large talent agencies dominated the talent market.

Conclusion
Competition was fierce among studios to procure talent. Studios leveraged their power by signing multi picture contracts with actors to counter high remuneration. Current supply chain model is industry-specific and difficult to implement in other industries. Specific contract terms & conditions for different suppliers. Supply chain model is responsive.

Buyer Supplier Mapping

Principal photography Story rights acquisition Directors

castings

Pre-production

Studio or Buyer

Agents

actors

lawyers
crew

Contractors/su b contractors