7-S Framework McKinsey

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Definition: 7-S Framework McKinsey

The McKinsey 7-S framework is a popular model used in organizations to analyse the environment to investigate if the company is achieving its intended objectives. The name of the McKinsey 7-S framework model can be explained by the fact that the model was developed by Tom Peters & Robert Waterman, consultants at the McKinsey & Company consulting firm.


Importance of McKinsey 7-S Framework

The McKinsey 7-S Framework model proposes 7 interdependent factors – 3 hard ‘S’ i.e. strategy, structure, systems; and 4 soft ‘S’ i.e. shared values, skills, style and staff.

The hard ‘S’ are more tangible, easily to define and easy to influence than the soft ‘S’.

1. Strategy – It refers to the intended sequence of actions taken by a company to achieve its goals and objectives. It deals with resource allocation and includes competition, customers and the environment.

2. Structure – It refers to how the various business units are structured and how they communicate with each other. A company’s structure may be centralized or decentralized or may take many other forms depending on the company’s culture and values.

3. Systems – This includes a host of systems within an organization that define its processes and routines. It includes performance appraisal system, financial systems, IT systems etc.

4. Shared values – These are the core values of the company that connect all the other 6 factors. These are the fundamental ideas or guiding principles that lay the foundation of businesses.

5. Skills – These define the core competencies of the employees. Some basic skills which employees must have are leadership, communication management, time management, team management etc.

6. Style – This spans the core beliefs, norms and management style in the organization.

7. Staff – It refers to the number and type of employees in the organization. It is very important for an organization to manage its human capital to create competitive advantage.

7-S Framework
The above diagram shows the McKinsey 7-S Framework components.

Hence, this concludes the definition of 7-S Framework McKinsey along with its overview.

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