What Is the McKinsey 7S Model?
The McKinsey 7S Model is a framework for organizational effectiveness that postulates that there are seven internal factors of an organization that need to be aligned and reinforced in order for it to be successful.
KEY TAKEAWAYS
- The McKinsey 7S Model is an organizational tool that assesses the wellbeing of seven internal factors of an organization as a means of determining whether a company has the structural support to be successful.
- The Model comprises a mix of hard elements, which are clear-cut and influenced by management, and soft elements, which are fuzzier and influenced by corporate culture.
Understanding McKinsey 7S Model
The 7S Model specifies seven factors that are classified as "hard" and "soft" elements. Hard elements are easily identified and influenced by management, while soft elements are fuzzier, more intangible and influenced by corporate culture. The hard elements are as follows:
The soft elements are as follows:
- Shared values
- Skills
- Style
- Staff
The framework is used as a strategic planning tool by organizations to show how seemingly disparate aspects of a company are, in fact, interrelated and reliant upon one another to achieve overall success.
Consultants Tom Peters and Robert Waterman, authors of the management bestseller "In Search of Excellence," conceived of the McKinsey 7S Model at consulting firm McKinsey & Co. in the early 1980s.
Special Considerations
The strategy is the plan deployed by an organization in order to remain competitive in its industry and market. An ideal approach is to establish a long-term strategy that aligns with the other elements of the model and clearly communicates what the organization’s objective and goals are.
The structure of the organization is made up of its corporate hierarchy, the chain of command, and divisional makeup that outlines how the operations function and interconnect. In effect, it details the management configuration and responsibilities of workers.
Systems of the company refer to the daily procedures, workflow, and decisions that make up the standard operations within the organization.
Shared values are the commonly accepted standards and norms within the company that both influence and temper the behavior of the entire staff and management. This may be detailed in company guidelines presented to the staff. In practice, shared values relate to the actual accepted behavior within the workplace.
Skills comprise the talents and capabilities of the organization’s staff and management, which can determine the types of achievements and work the company can accomplish. There may come a time when a company assesses its available skills and decides it must make changes in order to achieve the goals set forth in its strategy.
Style speaks to the example and approach that management takes in leading the company, as well as how this influences performance, productivity, and corporate culture.
Staff refers to the personnel of the company, how large the workforce is, where their motivations reside, as well as how they are trained and prepared to accomplish the tasks set before them.
The McKinsey 7-S Model is applicable in a wide variety of situations where it's useful to understand how the various parts of an organization work together. It can be used as a tool to make decisions on future corporate strategy.
The framework can also be used to examine the likely effects of future changes in the organization or to align departments and processes during a merger or acquisition. Elements of the McKinsey Model 7s can also be used with individual teams or projects.