The Mckinsey 7S Framework For Business Management

The McKinsey 7S Framework is a management tool developed by Tom Peters and Robert H. Waterman, Jr. of the consulting firm McKinsey & Company.

It is designed to help managers identify and analyze the key elements necessary for organizational success.

This framework comprises seven interdependent variables (“hard” and “soft” elements) that must be aligned in order for the organization to be successful.

The seven elements are: Strategy, Structure, Systems, Shared Values, Style, Staff, and Skills.

Let us take an example –

A company that produces medical supplies is trying to analyze its overall performance. In order to do so, they use the 7s Framework.

Strategy: Is the strategy focused on producing high-quality products for a wide range of medical applications?

Structure: The organizational structure of the company – is it good enough? The structure includes departments such as research and development, operations, marketing, and customer service.

Systems: How are the various various systems and processes implemented running? Are these systems producing efficient production and delivery of its products?

Shared Values: Is there a culture of innovation, customer satisfaction, and quality control?

Style: Does the company have a collaborative and supportive working style and encourages employees to share ideas and work together?

Staff: Does the company have a highly experienced team with a wide range of skills and expertise?

Skills: Has the company invested in training and development programs to ensure that its staff have the skills necessary to successfully produce and deliver its products?

The idea behind the 7S framework is that an organization’s effectiveness is determined by how well these seven elements are aligned with each other and with the organization’s mission.

It is widely used for organizational audits and for the development of strategies and plans.

How to Develop and Implement the 7S Framework

There are several steps to develop and apply the 7S framework –

Assess your current environment.

The first step in developing and implementing the McKinsey 7S Framework is to assess your current environment.

This includes gathering information about the people, strategy, structure, systems, skills, style, and shared values of your organization.

Gather input from stakeholders.

Once you’ve gathered the necessary information, it’s time to get input from all stakeholders.

This process should involve stakeholders from different levels within the organization, as well as external stakeholders.

It’s important to get multiple perspectives to help you better understand the current situation.

Analyze the data.

Once you’ve collected all the information, it’s time to analyze it.

You’ll want to identify the similarities, differences, and trends surrounding the 7S components.

This can be done through the use of data tools such as SWOT or PESTEL analyses.

Develop objectives and strategies.

Once you’ve identified the current state of your organization, it’s time to develop objectives and strategies. The objectives and strategies should be specific and should be focused on improving the 7S components.

Implement the plan.

After developing objectives and strategies, put them into action. This includes designing and implementing systems, making necessary changes to structure, training personnel, and developing a shared vision.

Monitor and adjust.

The implementation of the plan is only the beginning. It’s important to monitor the progress of your efforts and make adjustments as needed.

This can be done through a feedback loop or through continuous assessment and improvement.

Evaluate results.

The final step in developing and implementing the McKinsey 7S Framework is to evaluate the results.

This should provide insight into how successful the implementation was and what areas need further improvement. Armed with this information, you can make necessary changes to ensure your organization operates effectively.

Pros and Cons of the 7S Framework

The framework comes with a number of advantages and disadvantages –

Pros

It is very simple to understand and use, making it a popular tool for strategic planning.

The framework helps identify weaknesses in an organization’s current strategy and can be used to develop a more effective one.

It can be used to analyze both internal and external factors, such as competition, customer trends, and technological advancements.

It can be applied to any business, regardless of size or industry.

It provides a comprehensive overview of the organization and its strengths and weaknesses.

It can be used to develop a comprehensive strategy for the future.

Cons

It does not provide a comprehensive view of the organization’s environment, as it focuses on the internal aspects only.

The framework does not explicitly identify the main critical success factors for a business.

It does not account for changes in the external environment and can be difficult to adapt to such changes.

It can be time-consuming to analyze all seven elements.

The framework can be too simplistic and offer limited guidance on how to solve complex problems.