The McKinsey 7S Framework
How do you go about analyzing how well your organization is positioned
to achieve its intended objective?
 Developed in the early 1980s by Tom Peters and Robert Waterman,
two consultants working at the McKinsey & Company consulting firm,
the basic premise of the model is that there are seven internal
aspects of an organization that need to be aligned if it is to be
successful.
The 7-S model can be used in a wide variety of ways:
To help spot what you need to do to improve the performance of
your company.
Very useful when planning for change in the organization
Identify what’s not working in your organization
You need to ask yourself where you are
now and where you want to be in the
future
The model will help you assess these
elements with searching questions
1.Structure
A successful organization may make
temporary structural changes to cope
with specific strategic tasks without
abandoning basic structural divisions
throughout the organization
What it really means:
Organizational structure is your
hierarchy or your organizational
chart
Ask yourself this
How should an organization be
organized?
Functional Structure
Divisional Structure
Matrix Structure
Functional structure is set
up so that each portion of
the organization is
grouped according to its
purpose.
Divisional structure
typically is used in larger
companies that operate in
a wide geographic area or
that have separate smaller
organizations within the
umbrella group to cover
different types of products
or market areas.
Hybrid of divisional and
functional structure. This is
used in large multinational
companies, the matrix
structure allows for the
benefits of functional and
divisional structures to
exist in one organization
2. Strategy
Strategy determines how you’re
gonna beat your competitors and
succeed in your mission
What will the company do?
Market Penetration
Product Development
Market Development
This strategy involves an
attempt to increase
market share within
existing industries,
either by selling more
product to established
customers or by finding
new customers within
these markets – typically
by adapting the
‘Promotion’ element of
the Marketing Mix.
This involves developing Finding a new group of
new products for
buyers for an existing
existing markets by
product.
thinking about how new
products can meet
customer needs more
closely and outperform
competitors.
Diversification
Related Diversification
involves the production
of a new category of
goods that
complements the
existing portfolio, in
order to penetrate a
new but related market.
Unrelated
diversification entails
entry into a new
industry that lacks
important similarities
with the company’s
existing markets
https://themarketingagenda.com/2015/03/28/coca-cola-ansoff-matrix/
Coca-Cola
Market Penetration
Product Development
Market Development
Diversification
Due to the incredible strength
of Coca-Cola’s brand, the
company has been able to
utilise market penetration on
an annual basis by creating an
association between CocaCola and Christmas
The launch of Cherry
Coke in 1985 – CocaCola’s first extension
beyond its original
recipe
The launch of Coke Zero in
2005– its concept being
identical to Diet Coke; the
great taste of Coca-Cola but
with zero sugar and low
calories.
In 2007, Coca-Cola spent $4.1 billion to
acquire Glaceau, including its health
drink brand Vitaminwater. –Adapting
to the growing health drink sector
Unrelated: Coca-Cola offers official
merchandise from pens and glasses to
fridges, therefore exploiting its strong
brand advocacy through this strategy
Device Type: Desktop (July 2016)
Source:Netmarketshare.com
3.Systems
Systems are the resources and
procedures that your people use to do
their work
Question
What procedures need to be in place
(few or many)?
4. Style
Represents the style of leadership adopted in
the organization
What management style works best?
Autocratic
Democratic
Paternalistic
Budget Constraint Profit Conscious
An autocratic
management style is
one where the
manager makes
decisions
unilaterally, and
without much
regard for
subordinates.
Eg: The New York
Times(2001-2003),
Trump Organization
The manager allows
the employees to
take part in
decision-making:
therefore
everything is agreed
upon by the
majority. The
communication is
extensive in both
directions (from
employees to
leaders and vice
versa).
Is a type of fatherly
managerial style
typically employed by
dominant males where
their organizational
power is used to
control and protect
subordinate staff that
are expected to be
loyal and obedient
Manager
evaluated on
ability to achieve
budget in the
short term.
Manager evaluated
on ability to reduce
costs and increase
profit in the long
term.
5. Staff
Successful organizations view people as resources
who should be carefully nurtured, developed,
guarded, and allocated
• In other words, represents your employees and
their capabilities
What staff are required?
6. Skills
Refer to those activities organizations do best and for
which they are known.
Eg. Du Pont is known for research. P&G for product
management. ITT for financial controls. HP for
innovation and quality.
What skills will our staff and company
need?
• What skill does a company have?
• What skills is the company short of?
7. Subordinate Goals
Guiding concepts, values and aspirations that unite
an organization in some common purpose
• Your shared values determine the way you work
and the way you solve problems
What culture or attitudes will be most
suitable?
•The McKinsey 7S Model can be applied to
almost any issue at work. If there are
inconsistencies maybe the team or company
are not working effectively enough.
•The model can help reveal such
inconsistencies, and we can ensure that
they’re matched up to help you share values
and objectives with teams that are responsible
for making it happen