7-S Framework of McKinsey Management Theories

7-S Framework of McKinsey The 7-S framework of McKinsey is a Value Based Management (VBM) model that describes how one can holistically and effectively organize a company. Together these factors determine the way in which a

corporation operates. Shared Value The interconnecting center of McKinsey's model is: Shared Values. What does the organization stands for and what it believes in. Central beliefs and attitudes.

Strategy Plans for the allocation of a firms scarce resources, over time, to reach identified goals. Environment, competition, customers.

Structure The way the organization's units relate to each other: centralized, functional divisions (top-down); decentralized (the trend in larger organizations); matrix, network, holding, etc. System The procedures, processes and routines that characterize how important work is to be done: financial systems; hiring, promotion and performance appraisal systems; information systems. Staff

Numbers and types of personnel within the organization. Style Cultural style of the organization and how key managers behave in achieving the organizations goals. Management Styles. Skill Distinctive capabilities of personnel or of the organization as a whole. Core Competences. Element Application to Key

of 7S model

issues from practice and literature Strateg The Gaining y significance appropria of digital te marketing in budgets influencing and and demonstr supporting ating / organisations' delivering strategy value and ROI from budgets. Annual planning

digital marketing team

approach. Technique s for using digital marketing to impact organisati on strategy Technique s for aligning digital strategy with organisati onal and

marketing strategy Structu The re modification of organizationa l structure to support digital marketing. Integratio n of team with other managem ent, marketing (corporat e communic ations, brand marketing , direct marketing ) and IT

staff Use of crossfunctional teams and steering groups Insourcin g vs. outsourci ng The Campaign development planning System of specific approachs processes, integratio procedures or n

information systems to support digital marketing

Managing /sharing customer informatio n Managing content quality Unified reporting of digital marketing effectiven ess In-house vs.

Staff

external best-ofbreed vs. external integrated technolog y solutions The Insourcin breakdown of g vs. staff in terms outsourci of their ng background and characteristic Achieving s such as IT senior managem vs. ent buyMarketing,

use of contractors/c onsultants, age and sex.

in/involve ment with digital marketing Staff recruitme nt and retention. Virtual working

Style

Staff developm ent and training Includes both Relates to the way in role of which key digital

managers marketing behave in team in achieving the influencin organizations' g strategy goals and the cultural style it is it of the dynamic organization and as a whole. influential or conservati ve and looking for a voice Staff skills in specific areas:

Skills Distinctive

capabilities of supplier key staff, but selection, can be project interpreted managem as specific ent, skill-sets of Content team managem members. ent, specific emarketing approach es (SEO,PPC, affiliate marketing , e-mail marketing , online

advertisin g) The guiding Improving Superor concepts of the the digital perceptio dinate marketing n of the goals organisation importanc which are e and also part of effectiven shared values ess of the and culture. digital The internal marketing and external team perception of amongst these goals senior may vary managers and staff it works

with (marketin g generalist s and IT)

What is 7-S Model? The Seven-Ss is a framework for

analyzing organizations and their effectiveness. It looks at the seven key elements that make the organizations successful, or not: strategy; structure; systems; style; skills; staff; and shared values. Consultants at McKinsey & Company developed the 7S model in the late 1970s to help managers address the difficulties of organizational change. The model shows that organizational immune systems and the many interconnected variables involved make change complex, and that an effective change effort must address many of

these issues simultaneously. 7-S Model A Systemic Approach to Improving Organizations The 7-S model is a tool for managerial analysis and action that provides a structure with which to consider a company as a whole, so that the organization's problems may be diagnosed and a strategy may be developed and implemented. The 7-S diagram illustrates the multiplicity interconnectedness of elements that define an organization's ability to change. The theory helped to change

manager's thinking about how companies could be improved. It says that it is not just a matter of devising a new strategy and following it through. Nor is it a matter of setting up new systems and letting them generate improvements. There is no starting point or implied hierarchy - different factors may drive the business in any one organization. Shared Values Shared values are commonly held beliefs, mindsets, and assumptions that shape how an organization behaves its

corporate culture. Shared values are what engender trust. They are an interconnecting center of the 7Ss model. Values are the identity by which a company is known throughout its business areas, what the organization stands for and what it believes in, it central beliefs and attitudes. These values must be explicitly stated as both corporate objectives and individual values. Structure Structure is the organizational chart and associated information that shows who reports to whom and how tasks are both divided

up and integrated. In other words, structures describe the hierarchy of authority and accountability in an organization, the way the organization's units relate to each other: centralized, functional divisions (top-down); decentralized (the trend in larger organizations); matrix, network, holding, etc. These relationships are frequently diagrammed in organizational charts. Most organizations use some mix of structures - pyramidal, matrix or networked ones - to accomplish their goals. Strategy Strategy are plans an

organization formulates to reach identified goals, and a set of decisions and actions aimed at gaining a sustainable advantage over the competition. Systems Systems define the flow of activities involved in the daily operation of business, including its core processes and its support systems. They refer to the procedures, processes and routines that are used to manage the organization and characterize how important work is to be done. Systems include:

Business System

Business Process Management System (BPMS) Management information system Innovation system Performance management system Financial system/capital allocation system Compensation system/reward system Customer satisfaction monitoring system

Style "Style" refers to the cultural style of the organization, how key managers behave in achieving the organization's

goals, how managers collectively spend their time and attention, and how they use symbolic behavior. How management acts is more important that what management says. Staff "Staff" refers to the number and types of personnel within the organization and how companies develop employees and shape basic values. Skills "Skills" refer to the dominant distinctive capabilities and competencies of the personnel or of the organization as a

whole. References http://www.valuebasedmanage ment.net/methods_7S.html http://www.davechaffey.com/Ebusiness/Ch10Change/mckinsey-7s-strategymodel/ http://www.1000ventures.com/b usiness_guide/mgmt_inex_7s.ht ml

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