# How to Use the McKinsey 7-S Model for Strategic Planning

![McKinsey 7S Model: A framework for organizational effectiveness that focuses on seven internal factors that must be aligned.](https://www.investopedia.com/thmb/m2mk6kW1bHkMkZ7s4r4sgyrA6pw=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/mckinsey-7s-model.asp_edit-6178ec7115f14f27ae349e20c0bfdc9b.jpg)

*The model was created by Tom Peters and Robert Waterman while they were consultants at McKinsey & Company. — Investopedia / NoNo Flores*

> **Definition**
>
> The McKinsey 7-S model is a strategic framework that emphasizes the need for alignment among seven internal elements to drive organizational success.

## What Is the McKinsey 7-S Model?

The McKinsey 7-S Model is a tool for analyzing organizational performance by examining seven interconnected internal elements, ranging from structure and strategy to shared values. The idea is that alignment across all seven is important for achieving and maintaining effectiveness.

### Key Takeaways

*   The McKinsey 7-S Model is an organizational tool that assesses the well-being and future success of a company.
*   It looks at seven internal factors of an organization as a means of determining whether a company has the structural support to be successful.
*   The model comprises a mix of hard elements, which are clear-cut and influenced by management, and soft elements, which are influenced by corporate culture.
*   The seven elements are strategy, structure, systems, shared values, skills, style, and staff.

## What Are the Key Elements in the McKinsey 7-S Model?

The 7-S Model specifies seven factors that are classified as "hard" and "soft" elements. Hard elements are easily identified and influenced by management, while soft elements are more intangible and influenced by [corporate culture](https://www.investopedia.com/terms/c/corporate-culture.asp). The hard elements are as follows:

*   [Strategy](https://www.investopedia.com/terms/s/strategic-management.asp)
*   [Structure](https://www.investopedia.com/articles/basics/03/022803.asp)
*   [Systems](https://www.investopedia.com/terms/c/corporategovernance.asp)

The soft elements are as follows:

*   Shared values
*   Skills
*   Style
*   Staff

The framework is used as a strategic planning tool by organizations to show how seemingly disparate aspects of a company are, in fact, interrelated and reliant upon one another to achieve overall success.

> **Important**
>
> Consultants Thomas Peters and Robert Waterman Jr., authors of the management bestseller "In Search of Excellence," conceived of the McKinsey 7-S Model at consulting firm McKinsey & Co. in the late 1970s.

## How Are the 7-Ss Used in Strategic Planning?

Below, we take a closer look at each element in the 7-S Model:  

1.  The **strategy** is the plan deployed by an organization in order to remain competitive in its industry and market. An ideal approach is to establish a long-term strategy that aligns with the other elements of the model and clearly communicates what the organization’s objectives and goals are.
2.  The **structure** of the organization is made up of its [corporate hierarchy](https://www.investopedia.com/articles/basics/03/022803.asp), the chain of command, and divisional makeup that outlines how the operations function and interconnect. In effect, it details the management configuration and responsibilities of workers.
3.  **Systems** of the company refer to the daily procedures, workflow, and decisions that make up the standard operations within the organization.
4.  **Shared values** are the commonly accepted standards and norms within the company that both influence and temper the behavior of the entire staff and management. This may be detailed in company guidelines presented to the staff. In practice, shared values relate to the actual accepted behavior within the workplace.
6.  **Skills** comprise the talents and capabilities of the organization’s [staff](https://www.investopedia.com/articles/personal-finance/081015/8-reasons-why-valued-employees-quit.asp) and management, which can determine the types of achievements and work the company can accomplish. There may come a time when a company assesses its available skills and decides it must make changes in order to achieve the goals set forth in its strategy.
7.  **Style** speaks to the example and approach that management takes in leading the company, as well as how this influences performance, productivity, and corporate culture.
8.  **Staff** refers to the personnel of the company, how large the workforce is, where their motivations reside, as well as how they are trained and prepared to accomplish the tasks set before them.

The McKinsey 7-S Model is applicable in a wide variety of situations where it's useful to understand how the various parts of an organization work together. It can be used as a tool to make decisions on future corporate strategy.

The framework can also be used to examine the likely effects of future changes in the organization or to align departments and processes during a merger or acquisition. Elements of the McKinsey Model 7-S can also be used with individual teams or projects.

## What Is McKinsey, and What Does It Do?

McKinsey & Co. is a global consulting and accounting firm founded by University of Chicago management professor James O. McKinsey in 1926. The firm specializes in management consulting for a wide range of corporations, governments, and other organizations.

## What Are the 7-S Factors?

The seven factors in McKinsey's model are strategy, structure, systems, shared values, skills, style, and staff.

## Why Follow McKinsey's 7-S Model?

Among the primary reasons corporate management uses McKinsey's 7-S Model is to identify where a company excels and where it needs more work in creating an optimal and efficient workforce. Additionally, it is used to evaluate the performance of a company following a merger or other restructuring to identify areas in the business that need greater improvement and alignment. In many ways, it allows organizations to target problems and set a course of action to implement change.

## The Bottom Line

The McKinsey 7-S Model is a framework for optimizing organizational design through analyzing seven core elements: strategy, structure, systems, shared values, skills, style, and staff. As a widely used strategic planning tool, it allows organizations to function more effectively by aligning each of these elements in order to achieve their goals and objectives.

> **Article Sources**
>
> 1.  McKinsey. "[Enduring Ideas: The 7-S Framework](https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/enduring-ideas-the-7-s-framework#)."