Mckinsey’s 7S model refers to the 7 key elements of McKinsey (strategy, structure, systems, shared values, skills, style, staff) that tell you how well your organization is positioned to implement some changes or accomplish the organizational objectives successfully.
It is one of the best-performing models for checking organizational effectiveness. Let us dive deep into the world 7 s framework and understand their role in organizational structure strategy.
What is McKinsey 7 S Model?
The 7 s model is an instrument that analyses the companies organizational design by checking the seven essential internal elements.
Tom Peters and Robert Waterman who were the former consultants at McKinsey & Company developed seven elements of McKinsey in the late 1970s. According to them, these elements are the internal elements of an organization that has to aligned to fulfill the needs to change and achieve success.
These seven essential elements are as follows:
- Shared values
All of these seven elements combined helps the organization to function effectively and efficiently in their daily businesses.
Division of McKinsey 7S Model
These 7 elements are divided into two categories-
1. Hard Elements
As per Peters and Robert, the hard elements of the 7 s framework are of three types-
2. Soft Elements
According to Peters and Robert, the soft elements of McKinsey 7s model are of four types-
- Shared values
All three hard elements are easier to identify and manage compared to the soft elements while the soft elements are harder to manage, but they form the foundation of a company.
They are more likely to generate a competitive advantage for an organization compared to the hard elements.
Understanding McKinsey 7S Model
1. Strategy – 1s S of McKinsey 7 s Framework
This is essentially a plan made by every organization to garner sustained competitive advantage and compete in the market. The most successful strategies are the ones that are well articulated and have a long-term vision. They bring a competitive advantage reinforced by the values, vision, and mission of the organization. For instance, the short-term strategy is a wrong step as long-term strategies will bear more fruits in the long run.
2. Structure – 2nd S of McKinsey 7s Model
All of the business units and decisions are organized and have the data of who is to be held accountable. This can also term as the organizational chart and a hierarchy of who reports to whom. One of the easiest to track and change among all the seven elements.
3. System – 3rd S of McKinsey 7 s Framework
The procedure and processes of the organizations tell us about the daily activities of businesses. They also provide information on the individuals that are making these decisions inside the business. They determine the way how the business is conducted and hence, must be the main focus of the managers.
4. Skills – 4th S of McKinsey 7s Model
All the abilities of the employees working for the organization come under this head. They also include competencies and capabilities. Whenever there is an evident change in the organization, the question often arises on the company’s skillset.
5. Staff – 5th S of McKinsey 7 s Framework
The different types of employees and the number of employees working in an organization. This also includes the future labor requirements of the organization. It also includes the human resource segments such as training, recruitment, reward, and motivation.
6. Style – 6th S of McKinsey 7s Model
How the top-level managers handle all the organization is included in this head. All the actions, symbolic value, and interactions of these top-level managers with the lower-level employees are the main focus. In other words, the management style of the companies’ leaders.
7. Shared Values – 7h S of McKinsey 7 S Framework
All the organization’s standards and norms that form the building blocks of any organization fall under this head. These standards and norms guide the employees and actions, and companies’ behavior.
Applications of the Seven Elements of the McKinsey
The McKinsey 7 elements of the McKinsey framework are generally utilized for optimizing organizational design and effectiveness. Understanding the 7s model is quite simple, but its implementation may cause some sorts of misunderstanding. 5 key steps that can help in well-aligned implementations of McKinsey 7s are-
Step 1: Find out the areas that are not adeptly aligned
The initial aim of the 7s element is the identification and alignment of the elements. After that, finding the weaknesses, inconsistencies, and gaps between the relationships of the elements come into the picture.
For instance, the strategy relies upon introducing the product, but the matrix structure with a contradictory relationship hinders results.
Step 2: Decide the optimal organizational design
The top management helps to find out the effective and desired organizational design. After understanding the required alignment, one can set goals and makes the action plans much easier. This step is complicated compared to the first step.
We have to identify the optimal alignment that is not known now, so just a collection of data won’t help. Moreover, there is no set template or organizational design, so much research is put into this domain.
Step 3: Confirm the areas that require changes
This step is all about the organization’s action plan if the firm’s structure and the management style are not aligned with the company’s values.
You need to reorganize the reporting relationship, plus you should also decide those top managers that you should let go of or influence to their change of management style. Hence, the company can work more effectively.
Step 4: Doing the necessary changes
The implementation of any process holds the key to success in any process. Changes have a positive impact if the implementation is good enough.
So there may be a need to hire consultants or people in the company who will implement the changes successfully.
Step 5: The 7S needs to be reviewed continuously
All the 7 S: Strategy, Structure, System, Shared value, Style and Staff are dynamic. They keep on changing regularly.
A change in a single element always brings about ripple effects in the other elements. Hence, a new organizational design is needed to keep with the changes. Hence, the continuous evaluation and research of all the seven areas is a must.
McKinsey’s 7-S framework can be applied to any organizational or team effectiveness issue during the search of excellence and productivity.
In case an organization is not performing up to its full potential, there are chances that the organization has an inconsistent alignment of these seven elements of McKinsey. By understanding such inconsistencies, you will be able to align- Strategy, Structure, Systems, Style, Staff, Skills, and Shared Values- so they can contribute towards success.
Finding out where your organization is in terms of the 7s framework and its likely effects of the future always helps and empower a corporate culture and their management.
How important do you find the 7s model in understanding the effects of future changes and optimizing organizational effectiveness?