What is the McKinsey 7S Framework?

The McKinsey 7S Framework is a Tool that describes a global picture of a Company or Business, according to 7 Elements.

 

This global picture can be used for different purposes:

  • Tracking the evolution of the company over time.
  • Better organize the actions to be taken.
  • Define appropriate strategies, where they are most needed.

 

Let’s explain these 7 Elements in detail:

7 Elements of McKinsey 7S Framework

1. Strategy: What the Company or Business does to achieve its Goals.

  • What characterizes their Strategy?

 

2. Structure: How the Company is Organized.

  • Centralized, Departmentalized, Associated to third parties, etc.

 

3. Staff: How Talent is managed and valued.

  • How people relate to each other.

 

4. Style: What is the Culture of the Company?

  • Its Character or “Personality”: Friendly, Cold… and Why.

 

5. Skills: How people work together.

  • What job skills are valued the most?

 

6. Systems: What Resources does a Company have.

  • Facilities, Financial resources, Processes, etc.

 

7. Shared Values: What are the Values associated with the Company?

  • Their Reputation: what outsiders think of them.

 

And… all these Elements depend on each other:

McKinsey 7S Framework

McKinsey 7S Framework representation.

 

As you can see in the image above, the Elements are shaded in 2 different colors.

Why?

 

Because traditionally, McKinsey 7S Elements are classified into 2 groups:

  • Hard Elements.
  • Soft Elements.

 

Let’s explain why:

Hard Elements

 

These are the “traditional” factors that any analyst would first check when analyzing a company.

 

They are called Hard because their performance can be objectively evaluated with technical parameters.

  • That is why there is always so much pressure on tracking these Elements.

 

For example:

You can objectively measure whether one Strategy is better than another.

  • If you achieve your Goals faster, if your profitability is higher, etc.

 

You can objectively measure if your Systems (Resources) are better than others:

  • If your results are better, if you have less waste (in a manufacturing process), if you get your results faster, etc.

 

You can objectively measure the performance of your Structure:

  • Trying different Structures and adopting the one that gives better results.

Soft Elements

 

These Elements cannot be measured objectively.

  • Or it is very difficult and highly subjective.

 

For example:

How can you measure the “management” philosophy of a company?

  • If a friendly approach is better than a “tougher” one… It would depend entirely on the employee.

 

How can you measure the “talent or skills that should be valued the most”?

  • You would need 2 identical companies, with identical employees to compare the results.

 

How can you objectively measure the performance of the “Style”?

  • You can’t change the Style of a company from one day to the next and compare the results.

 

The exact same thing happens with the “Values associated” with a company.

  • Not even Socrates would dare decide which would be best.

Now, you may be wondering:

  • “Is this useful?”
  • “Why worry about McKinsey 7S Framework?”

Why is McKinsey 7S Framework important?

This Tool is very useful because: with just 7 Elements to focus on, you can assess what a Business looks like.

  • And, as you develop this analysis, you’ll always find something interesting that you didn’t notice before.

 

And more important: You can compare different companies at a glance.

 

Why is this important?

  • You can learn how other companies achieve their goals in such an efficient way.
  • It can help you decide which company to invest in.
  • It can help you “imitate” some aspects of larger, more profitable companies.
  • etc.

 

As you may already know, we have worked in Venture Capital for years.

Trust us: A properly developed McKinsey 7S Framework makes things much easier when evaluating different projects.

But… Is this Tool designed only for large Companies?

When should it be used?

When should you use the McKinsey 7S Framework?

Whenever you have to analyze your Company or other Businesses, you should think about using this Tool.

 

However, we highly recommend using the McKinsey 7S Framework in 3 situations:

 

If you work in a Big company, in a managerial position.

  • As we mentioned before, it can help you defining your Tactics and Strategies.

 

If you are starting a New Project.

  • It gives you a good guideline.
    • You’ll be able to decide where to focus, much better.

 

If you want to improve your Business.

  • It can help you discover what are the most important Elements to focus on.
    • Let’s be honest: Unless you follow some guideline, you’d never think about these 7 Factors.
  • As mentioned earlier, it can help you compare your Business to that of your Competitors.

 

Let’s see some examples:

McKinsey 7S Framework examples

We always say that, all these Tools designed for Business management, should be applied in many more areas.

  • Not just in large Corporations.

 

That is why we have decided to use the McKinsey 7S Framework for analyzing some of the most successful YouTube Channels.

 

Let’s have some fun:

PewDiePie - McKinsey 7S example

 

Felix Arvid Ulf Kjellberg, more known as PewDiePie is, at the moment, the biggest YouTuber on Earth.

  • He’s got more than 100 million subscribers, just in its main YouTube channel.

 

This has made us wonder: How is it possible to have more subscribers than… The number of people living in Germany?

  • Think about it… It is spectacular!

 

This is not a “happy coincidence” or a simple stroke of luck…

  • He must be doing something exceptional (of course).

 

We have analyzed 20 of his videos to find out what is going on, hoping that we can learn something from him.

  • 10 of them, randomly chosen.
  • 10 of them, the most popular ones.

To do so, we have developed a McKinsey 7S  Framework on PewDiePie:

 

PewDiePie – McKinsey 7S Framework.

 

Conclusions

 

Strategy: His content relies on his Personality and Opinion.

  • It is not a Knowledge-based channel.

 

Structure: Minimalist Structure (that we can appreciate).

  • It is him and, sometimes, other few people: there is not a “team” working with him (in front of the camera, at least).

 

Systems: His main Resource, which surprised us is: He is capable of publishing content every day.

  • He has published more than 4,000 videos in 10 years… That’s more than one video per day.

 

Staff: As we mentioned in the Structure, it seems like it is just him.

  • We don’t know if he has lot of external support but, we don’t think so.

 

Skills: If you have +100 million subscribers… You are an extremely talented communicator.

  • His almost-polemic but polite “jokes” are not easy to make, and he does it naturally.

 

Style: Casual Style: He looks like “one of your friends”.

  • He doesn’t over-prepare the Set, Studio, Make-up… So it looks more natural and “real”.

 

Shared Values: He says what he thinks, whatever happens.

  • That, has gotten him into trouble.

 

Why is he so popular?

 

Maybe, because people is tired of “fake TV scenarios” and scripted dialogues.

He offers “authenticity” even if it gets him in trouble.

 

And don’t forget… He has uploaded more than 4,000 videos, what seems… insane for us.

MrBeast - McKinsey 7S example

 

Jimmy Donaldson, more known as MrBeast is one of the fastest growing YouTubers.

  • Currently, he has more than 37 million subscribers.

Again… that is the population of Canada. Amazing.

 

Unlike PewDiePie, he has “only” uploaded 700 videos.

  • Compared to 4,000, it is a significantly smaller amount of videos.

 

We have also analyzed 20 of his videos.

  • 10 randomly chosen.
  • 10 of his most popular ones.

 

We have then developed a McKinsey 7S Framework:

 

MrBeast – McKinsey 7S Framework.

 

Conclusions

 

Strategy: His content is Shocking and Bizarre.

  • He uses surreal situations to capture the attention of the users.

 

Structure: Although he is the “central pillar” he has a “gang” with him.

  • Plus, he uses outsiders to film their reactions.

 

Systems: The main resource he has is: Spending and giving a lot of money for free.

  • In fact, practically all his videos are money-related.

 

Staff: All of the MrBeast “gang” members switch roles constantly.

  • It seems that nobody has a fixed role.

 

Skills: He is a friendly, very social person. He is always happy.

  • He transmits “good vibes”.

 

Style: It seems to be a mix of: Friendly-Crazy-Generous-Teen style.

  • It is what you would do with a million dollars if you didn’t need it and also you were extremely generous.

 

Shared Values: Be unique, and make people happy (with money).

  • Good Vibes are stronger than Bad Vibes.

 

Why is he so popular?

 

Because he does what you always wanted to do (as an adult or when you were a child).

Because of the reactions people have when they receive large unexpected amounts of money.

  • You don’t see this on TV.

The Daily Wire - McKinsey 7S example

 

The Daily Wire is a completely different YouTube Channel than the ones we mentioned before.

 

It is a News Channel created by Ben Shapiro from scratch on YouTube.

  • Now, they have almost 2 million subscribers, only on their main channel.

 

What amazed us the most is:

  • The quality of their content.
  • The high quality of the professionals involved.
  • The high level of professionalism.

* You may agree or not with them (it is a conservative channel) but their content is undoubtedly of very high quality.

  • We want to remain neutral regarding politics (moreover, we’re not from USA; our team is fully European).

 

It seems more serious and professional than a traditional TV news channel.

 

Again, we have analyzed 20 of their videos:

  • 10 random videos of Ben Shapiro’s Show.
    • With 2 Sunday Specials.
  • 10 random videos of the different collaborators.
    • Matt Walsh, Michael Knowles and Andrew Klavan.

 

This is the resulting McKinsey 7S Framework:

 

The Daily Wire – McKinsey 7S Framework.

 

Conclusions

 

Strategy: High quality professional-style content.

  • The founder, Ben Shapiro graduated summa cum laude both from UCLA and Harvard.

 

Structure: Ben Shapiro is the “central pillar” of the show.

  • There are other presenters, with a high level of knowledge as well.

 

Systems: The main resource they have is: their Knowledge and Contacts.

  • In the Sunday Specials, they have interviewed: Neil deGrasse, Jordan Peterson, Tucker Carlson, Piers Morgan, etc…

 

Staff: It seems that the different presenters have a high degree of autonomy.

  • It is difficult to say, but we don’t appreciate a “hard” management system.

 

Skills: They are all highly analytical or, at least, try to be.

  • Argumentation skills seem to be very appreciated.

 

StyleThey don’t use difficult concepts or metaphors. They want everybody to understand their message.

  • Despite having a “professional approach”, the style is quite Informal.

 

Shared Values: Their motto is: “Facts don’t care about your feelings“.

  • That phrase sums up their values quite well.

 

How is it possible that a YouTube News Channel has been so successful?

 

Because they say what TV news channels don’t dare to say.

 

TV news channels are generally very influenced by politicians, lobbies, etc.

  • Moreover, they have to be very politically correct on many issues.

 

The Daily Wire has the “freedom” to speak its audience’s mind.

  • And they say it in a professional way (not in a “parody style”).

Summarizing

The McKinsey 7S Framework is a Tool that describes a global picture of a Company or Business, according to 7 Elements.

  • With just 7 Elements you can assess what a Business looks like and compare different companies at a glance.

 

These 7 Elements are often divided into 2 groups:

Hard Elements:

  • Strategy.
  • Structure.
  • Systems.

Soft Elements:

  • Staff.
  • Skills.
  • Style.
  • Shared Values.

 

It is highly recommended to develop a McKinsey 7S Framework:

  • If you work in a Big company, in a managerial position.
  • If you are starting a New Project.
  • If you want to improve your Business.

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