CandleFocus Glossary Editor
The McKinsey 7S framework was first developed in 1981 by Tom Peters and Robert Waterman, two Yale University graduates who went on to join the consulting firm McKinsey & Company. It has since become a seminal reference tool for organizational change and an analytical framework for understanding a company’s functioning and performance.
The 7 dimensions of the framework are:
1. Structure: What is the corporate structure – centralized or decentralized, hierarchical or flat?
2. Systems: What accounting, monitoring, and budgeting systems are in place?
3. Strategy: What is the long-term strategy?
4. Skills: What skills and capabilities do people in the organization have?
5. Staff: What is the organizational culture, staff morale, and training programs?
6. Style: What is the leadership style and how does it affect decision-making?
7. Shared Values: What are the core values and beliefs shared by all stakeholders?
The 7 Ss provide a useful framework to assess an organization’s strengths as well as areas that need improvement. The model emphasizes the importance of “fit” among the elements, and a need to look at them as a whole. For example, a company might have efficient systems in place, but if the strategy or skills of employees do not match those systems, the organization will struggle to perform effectively.
Furthermore, the 7Ss reinforce the idea that hard elements of an organization (structure, systems, and strategy) must be balanced with the softer elements (style, skills, staff, and shared values) for long-term success. It is essential for managers to address problems in all aspects of their organization in order to ensure that nothing is overlooked.
The McKinsey 7S model is one of the most widely used analytical tools to assess organizational effectiveness, and it has faced criticism due to its lack of scientific precision. Nonetheless, its focus on organizational alignment and its recognition of the need to balance hard elements with soft elements is highly applicable in today’s business world. Most importantly, it provides a useful framework to challenge outdated assumptions, identify areas of misalignment, and lay the groundwork for developing and executing a successful strategy.
The 7 dimensions of the framework are:
1. Structure: What is the corporate structure – centralized or decentralized, hierarchical or flat?
2. Systems: What accounting, monitoring, and budgeting systems are in place?
3. Strategy: What is the long-term strategy?
4. Skills: What skills and capabilities do people in the organization have?
5. Staff: What is the organizational culture, staff morale, and training programs?
6. Style: What is the leadership style and how does it affect decision-making?
7. Shared Values: What are the core values and beliefs shared by all stakeholders?
The 7 Ss provide a useful framework to assess an organization’s strengths as well as areas that need improvement. The model emphasizes the importance of “fit” among the elements, and a need to look at them as a whole. For example, a company might have efficient systems in place, but if the strategy or skills of employees do not match those systems, the organization will struggle to perform effectively.
Furthermore, the 7Ss reinforce the idea that hard elements of an organization (structure, systems, and strategy) must be balanced with the softer elements (style, skills, staff, and shared values) for long-term success. It is essential for managers to address problems in all aspects of their organization in order to ensure that nothing is overlooked.
The McKinsey 7S model is one of the most widely used analytical tools to assess organizational effectiveness, and it has faced criticism due to its lack of scientific precision. Nonetheless, its focus on organizational alignment and its recognition of the need to balance hard elements with soft elements is highly applicable in today’s business world. Most importantly, it provides a useful framework to challenge outdated assumptions, identify areas of misalignment, and lay the groundwork for developing and executing a successful strategy.