Based in discussions with consultants, academics, and business leaders, the consulting firm of McKinsey & Co has proposed the Seven-S Model for successful strategy implementation. McKinsey’s consultants found that neglecting any one of seven key factors could make the effort to change a slow, painful and even doomed process.
Each of these factors is equally important and interacts with all other factors. Any number of circumstances may dictate which of the factors will be the driving force in the execution of any particular strategy.
Structure: The Seven–S model adds a contemporary perspective to the problem of organizational structure. The McKinsey consultants point out that in today’s complex and ever changing environment a successful organization may make temporary structural changes to cope with specific strategic tasks without abandoning basic structural divisions throughout the organization.
Strategy: The Seven-S model emphasizes that, in practice, the development of strategies poses less of a problem than their execution.
Systems: This category consists of all the formal and informal procedures that allow the organization to function, including capital budgeting, training and accounting systems. Systems can overpower expressed strategies. Thus, a consumer goods manufacturer might find it impossible to implement a new portfolio strategy if its management information system is not adjusted to produce the necessary cost data by segment, because there would be no way to compare the different segments of the business.
Style: ‘Style’ refers not to personality, but to the pattern of substantive and symbolic actions undertaken by top managers. It communicates priorities more clearly than words alone, and may profoundly influence performance. For example, consultants have found that even oil and mineral exploration efforts, surely matters of operational skills ands luck more than strategy, benefit from top management attention. Exploration is more successful in companies whose top managers spend more of their own and the board’s time participating in exploration activities, articulate better reasons for exploration, recruit more people with exploration experience, fund exploration more consistently, and have exploration managers report to higher organizational levels
Staff: Successful organizations view people as valuable resources who should be carefully nurtured, developed, guarded, and allocated. Top managers devote time and energy to planning the progress and participation of existing managers, and use job assignment policies to actively foster the development of new managers. Similarly, new hires are given jobs in the mainstream of the organization, whether that be marketing or new product innovation. Talented individuals area assigned mentors put I to fast track programs exposed to top management, and rapidly moved into positions of real responsibility.
Skills: The term skills refer to those activities organizations do best and for which they are known. For examples, Du Pont is known for research, Procter &Gamble for product management, ITT for financial controls, and Hewlett-Packard for innovation and quality. Strategic changes may require organizations to add one or more new skills. Strategic initiatives that require the dismantling or revisiting of an old skill even more difficult implemented problem.
Super-ordinate Goals: This refers top guiding concepts, values, and aspirations that unite an organization in some common purpose. Super-ordinate goals are often captured in a mission statement, but they are also be phrased as a simple slogan, such as ‘new products’ at 3M. Super-ordinate goals have deep meaning within the organization. They provide a sense of purpose and certain stability as other, more superficial characteristics of the organization change.