Mckinsey 7'S Framework: The Soft Elements Are As Follows

McKinsey 7’s Framework
 The McKinsey 7S Model is a framework for organizational effectiveness that

postulates that there are seven internal factors of an organization that need to be
aligned and reinforced for it to be successful.
 The McKinsey 7S Model is an organizational tool that assesses the well-being and
future success of a company.
 It looks to 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 fuzzier and influenced by corporate
culture.
The Seven Elements of Mckinsey Model
The 7S 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 fuzzier, more intangible, and influenced by organizations. The hard
elements are as follows:
 Strategy
 Structure
 Systems
The soft elements are as follows:
 Shared values
 Skills
 Style
 Staff
Importance of seven elements of Mckinsey Model
o 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 objective and goals are.
o The structure of the organization is made up of its hierarchical positions 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.
o Systems of the company refer to the daily procedures, workflow, and

decisions that make up the standard operations within the organization.
o Shared values are the commonly accepted standards and norms within the
company that both influence and temper the behaviour 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 behaviour within
the workplace.
o Skills comprise the talents and capabilities of the organization’s employees

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.
o 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.
o 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 uses of Mckinsey Model
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 7s can also be used with individual teams or projects.
Question: - Explain Michael Porter’s Value Chain Analysis.
Porter’s Value Chain Analysis
The strength of the Porter’s Value Chain Analysis is its approach. The Porter’s Value Chain
Analysis focuses on the systems and activities with customers as the central principle rather
than on departments and accounting expense categories. This system links systems and
activities to each other and demonstrates what effect this has on costs and profit.
Consequently, it (Value Chain Analysis) makes clear where the sources of value and loss
amounts can be found in the organization.
The Value Chain activities
Porter’s Value Chain Analysis consists of several activities, namely primary activities and
support activities. Primary activities have an immediate effect on the production,
maintenance, sales and support of the products or services to be supplied. These activities
consist of the following elements:
Inbound Logistics
These are all processes that are involved in the receiving, storing, and internal distribution of
the raw materials or basic ingredients of a product or service. The relationship with the
suppliers is essential to the creation of value in this matter.
Production
These are all the activities (for example production floor or production line) that convert
inputs of products or services into semi-finished or finished products. Operational systems
are the guiding principle for the creation of value.
Outbound logistics
These are all activities that are related to delivering the products and services to the customer.
These include, for instance, storage, distribution (systems) and transport.
Marketing and Sales
These are all processes related to putting the products and services in the markets including
managing and generating customer relationships. The guiding principles are setting oneself
apart from the competition and creating advantages for the customer.
Service
This includes all activities that maintain the value of the products or service to customers as
soon as a relationship has developed based on the procurement of services and products.
Support activities of the Value Chain Analysis
Support activities within the Porter’s Value Chain Analysis assist the primary activities and
they form the basis of any organization. In the figure dotted lines represent linkages between
a support activity and a primary activity. A support activity such as human resource
management for example is of importance within the primary activity operation but also
supports other activities such as service and outbound logistics.
Firm infrastructure
This concerns the support activities within the organization that enable the organization to
maintain its daily operations. Line management, administrative handling, financial
management are examples of activities that create value for the organization.
Human resource management
This includes the support activities in which the development of the workforce within an
organization is the key element. Examples of activities are recruiting staff, training and
coaching of staff and compensating and retaining staff.
Technology development
These activities relate to the development of the products and services of the organization,
both internally and externally. Examples are IT, technological innovations and improvements
and the development of new products based on new technologies. These activities create
value using innovation and optimization.
Procurement
These are all the support activities related to procurement to service the customer from the
organization. Examples of activities are entering into and managing relationships with
suppliers, negotiating to arrive at the best prices, making product purchase agreements with
suppliers and outsourcing agreements. Organizations use primary and support activities as
building blocks to create valuable products, services and distinctiveness.

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McKinsey 7’s Framework

 The McKinsey 7S Model is a framework for organizational effectiveness that

The Seven Elements of Mckinsey Model

The soft elements are as follows:

Importance of seven elements of Mckinsey Model

o The strategy is the plan deployed by an organization in order to remain

o Systems of the company refer to the daily procedures, workflow, and

o Skills comprise the talents and capabilities of the organization’s employees

o Style speaks to the example and approach that management takes in leading

The uses of Mckinsey Model

Question: - Explain Michael Porter’s Value Chain Analysis.

Porter’s Value Chain Analysis

The Value Chain activities

Marketing and Sales

Support activities of the Value Chain Analysis

Human resource management

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