The McKinsey 7S Framework: A strategic approach for leaders to manage change and improve performance.
Do you know how well your organisation is positioned to achieve its goals? Or what elements influence its ability to implement change successfully?
There are many useful models of organisational effectiveness available to help you understand and explore your structure and key elements of business. Some of these are more popular than others and some have lasted the test of time such as the McKinsey 7-S framework.
The model was developed in the late 1970s by Tom Peters and Robert Waterman, former consultants at McKinsey & Company. They identified seven internal elements of an organisation that need to align for it to be successful.
You can explore the seven elements in detail, and learn how to improve performance or manage change in your organisation by ensuring that they all work in harmony. They are completely interrelated and change in one element will undoubtedly impact the other elements, which is why you have to view all seven elements holistically and approach the model with a dynamic relationship across all the elements.
When to Use the McKinsey 7-S Model
You can use the 7-S model in a wide variety of situations where it's useful to explore how the various parts of your organisation relate to each other and work together.
For example, it can help you to improve the performance of your organisation, or to determine the best way to implement a proposed strategy or change programme. It can also help you understand and identify what needs to change or improve to help you deal with significant scale-up.
The framework can be used to examine the likely effects of future changes in the organisation, or to align departments and processes during a merger or acquisition. You can also apply the McKinsey 7-S model to elements of a team or a project.
The model below categorizes the seven elements as either "hard" (dynamic) or "soft" (gentle) or I sometimes prefer to use Process and People.
The three "hard" elements are strategy, structures (such as organisation charts and reporting lines), and systems (such as formal processes and IT systems.) These are relatively easy to identify, and management can influence them directly.
The four "soft" elements, on the other hand, can be harder to describe, less tangible, and more influenced by your company culture. But they're just as important as the hard elements if the organisation is going to be successful.
Figure 1, below, shows how the elements depend on each other, and how a change in one affects all the others.
Explanation or description of the seven elements:
Strategy: this is your organisation's plan for growing and building and maintaining a competitive advantage over its competitors
Structure: this how your company is organised (that is, how departments and teams are structured, including who reports to whom)
Systems: the daily activities and procedures that the staff uses to get the job done
Shared values: these are the core values of the organisation, and the expected behaviours that align to the identity you want.
Style: the style that the leadership team have adopted
Staff: the employees and their general capabilities and attitudes
Skills: the actual skills and competencies of the organisation's employees
Checklist Questions for the McKinsey 7-S Framework
The following questions are a starting point for exploring your situation in terms of the 7-S framework. Use them to analyse your current (Point A) state first, and then repeat the exercise for your proposed future state (Point B).
What is our strategy?
How do we intend to achieve our objectives?
How can we get ownership and get everyone involved?
How do we deal with competitive pressure?
How are changes in customer demands/capacity dealt with?
How is strategy adjusted for environmental issues or other external factors?
How is the company/team divided?
What is the hierarchy?
Is the structure clear to everyone?
How do the various departments coordinate activities?
How do the team members organise and align themselves?
What is our meetings' structure - are our meetings productive, useful and appropriate?
Do we deal with remote/hybrid working effectively and productively?
What are the main systems that run the organisation? Consider financial and HR systems as well as planning, ERP, communications and document storage etc.
Where are the controls or KPIs and how are they monitored and evaluated?
What internal rules and processes does the team use to keep on track?
Do we have a process in place for continuity planning?
What are the core values (and expected behaviours)?
How strong (and relevant) are the values?
Are our values and expected behaviours embedded in the organisation?
What are the fundamental values that the company/team was built on?
What is the corporate/organisational/team culture?
Do we measure our culture? (engagement/values/behaviours)
What is our management/leadership style?
Is it the style we want for our leaders
How effective is the current leadership - do we have trust?
Do employees/team members tend to be competitive or cooperative and collaborative?
Are there real teams functioning within the organisation or are they just nominal (silo) groups?
Do we have an engaged workforce?
What positions or specialisations are represented within the team?
What are out critical roles?
What positions need to be filled?
Are there gaps in required behaviours and competencies?
Do we have the appropriate balance of full time employees and agency or support staff?
What are the strongest skills represented within the company/team?
Are there any skills gaps - and do we have a skills matrix?
What are we passionate about?
What is the company/team known for doing well?
Do the current employees/team members have the ability to do the job?
How are skills monitored and assessed?
FREE TEMPLATE DOWNLOAD
To help you to analyse your current state and proposed future state you can download a PDF template of the Checklist Questions with spaces for your own thoughts and comments HERE. (Please note you need to sign up to create a free Tribero members account and be logged in to access our resources in the File Share section of our Members Area - contact us if you get stuck)
Article by Trevor Norman
Trevor is a leadership coach and cognitive behavioural therapist and specialises in organisational behavioural analytics and team dynamics