7Ps Mckinsey

Matheus Rangel Sales Riscado What do you consider to be the best way in which to analyse and design organisations and why?

When it comes to analysing and designing organisations, the main issue is to decide which factors should be studied in order to get the best feedback possible. This kind of study is extremely important to every company, since its architecture will determine the path that the company will go through to reach their goals.

Many ways to do this kind of analysis exist and are used world widely, but the ones that are able to give the best results are, in my opinion, McKinsey 7s model and Galbraith`s Star model. Both models are useful because they describe very important organisational elements and recognise the interaction between them. Both also require organisations to use a chosen strategy to inform structure decisions.

The two methods show critical limitations, especially regarding input and output elements and the external environment. A company`s organisational design has the role of arranging its process in a way that they are successful and realize the main qualities defined in their visions and values. Hence, I think that the best way to analyse it is using McKinsey 7S model. In this model, the shared values of the company are in the core of the system which they use to design the structure of the relations inside a company.

As different models focus on different aspects, the 7S model focus on internal aspects and it was chosen considering that this is the focus of the analysis. The seven elements (S`s) considered are: Strategy, or the plan and directions to build competitive advantage; Structure, who reports to whom; Systems, daily procedures done by the workers; Skills, the abilities of the employees; Staff, the employees themselves; Style, the kind of leadership used within the company; and Shared values, core values of the corporation. I think these are great ones to internally analyse an organisation. The model is based on the premise that an organisation has to align seven internal aspects in order to achieve the desired success. The framework scheme can be seen on the image below:

Figure 1 - McKinsey 7S framework

2

I really like the how they divide these elements. Strategy, Structure and Systems are "hard"

elements, because they are more tangible and easier to be fixed or managed. The others

are “soft” elements, because they are more difficult to describe and define and less

influenced by culture decision. I totally agree with that, having in mind that these adjectives

do not refer to their importance, since both hard and soft elements are equally important to

the organisation`s success.

Considered a diagnostic management tool, the 7S model will give the firm the basis to

improve its performance, examine the expected effects of upcoming changes within it,

determine how best to implement a suggested strategy and align departments and

processes during a fusion or acquisition. It is designed to facilitate the process of strategy

implementation within the context of a change.

As mentioned before, for me, the strongest point of this method is that the core aspect of its

design is “Shared Values”. It shows that these values are critical to the analysis of the other

elements. Staffs, Skills, Strategy, Structure and Style, all of them have their basis on what is

the main purpose and principles of the company. If these basic values change, all other

aspects will change subsequently.

Though this model is strong to analyse a company in the situation of a change (possible or

concrete), it is also helpful just to identify which elements and relations are misaligned in

order to help the organisation to improve its performance. A bad point about that is that 7S

method does not have a performance variable.