The change models used to focus on the strategic areas of the change management. However, the McKinsey 7S model focused on the company’s structure and system along with the changes. The change professional realized the significance of coordination and collaboration among the entire company’s structure to achieve its goals and objectives with high corporate expansion and complexity. Today, we’ll discuss McKinsey 7S model change management; its definition, key elements; benefits, challenges, and McKinsey 7S Model with example of Nokia.
What is McKinsey 7S Model Change Management?
McKinsey 7S model change management focuses on the company’s design and structure. Its objective is how the change professionals would deal with changes by developing a strategic approach around its seven core elements; structure, strategy, system, shared values, skill, style, and staff.
The 7S model points out the current domino effect when the transformation of one element leads to restoring the balance of the impact. The emphasis on shared values is developing a strong that would impact all the driving elements for change.
We can divide the 7S framework elements into two categories and they’re as follows;
- Soft Elements: comprised of culture-driven and intangible elements like skills, staff, style, and shared values
- Hard Elements: they’re easily recognizable and the company’s management impacts them like system, structure, and strategy
Key Elements of McKinsey 7S Model Change Management
Let’s discuss the main of McKinsey 7S model change management; they are as follows;
Structure
The organizational structure outlines various types of roles, units, departments, and divisions that build the company. It also comprises of reporting structure that how various departments report and interact with one another. However, the structure is significant because it allows you to clearly outline the role, responsibility, and autonomy of employees that they play within the organization.
If you execute changes that would impact the roles of various employees and team members; then it is highly difficult to execute a plan if the company’s system and structure are unsupportive.
Strategy
An effective and efficient strategic approach offers you strong grounds for developing a change management plan. It is highly difficult and challenging for employees and team members to motivate them about the changes without having a clear strategy. However, if you clearly outline the direction of your company and how your business would grow, then people will comprehend and deal with the changes that are necessary to keep your business moving forward.
System
The organization system comprises processes, procedures, and protocols that employees have to follow to finish their tasks and activities. When it comes to changing the system, then it is significant to analyze various workflows and project management systems that are prevailing. Every system would have a different impact on a company’s functions and operations.
Shared Values
Share values comprise a workplace culture that how the employees and team members interact with each other. For instance, if a company has a workaholic and pay-hard culture, then it requires a lot of effort to have fun together. If another company comprises such people that are cautious about maintaining the work-life balance, then they have flexible scheduling and have some time off for their personal activities.
Skill
The skill set analysis allows you to determine what employees are bringing to the table and what type of expertise they should learn and acquire. The objective of this analysis is to know whether the skill set of employees and team members is up-to-date or not. However, if your company is operating its business in a rapidly changing environment, then you should make sure that your employees are learning new skills and expertise.
Style
It is a style of decision-making and leadership that is currently prevailing in the company. You should analyze the needs and requirements of changes within any department or unit while managing the style. Some companies follow the top-to-bottom structure, whereas others follow the team-focused style.
For instance, a company has a casual working environment. If it needs a formal working environment, then it has to execute changes at the mass scale.
Staff
The staff comprises all the team members and employees. You should keep in mind the following elements while analyzing the staff;
- Workforce and employee strategy
- Their diversity and attrition level
- Gaps in the company and the vacant positions
- Lower morale and burnout issues among employees
- Right people holding the right positions in your company
Benefits of McKinsey 7S Model CM
Some of the main benefits and advantages of McKinsey 7S model for change management are as follows;
- Longstanding strategic practices that various companies have implemented over time
- Offers effective tracking capabilities for impacting the changes
- Developing coherence and synchronicity among various parts and units of the company
Challenges of McKinsey 7S Model CM
Some of the main challenges and disadvantages of McKinsey 7S model for change management are as follows;
- Highly dependent on the internal processes and factors; sometimes the external factors impact the company
- Not analyzing the right area successfully
- Static model, whereas the business environment is dynamic and changing constantly
- Limited empirical evidence to support and endorse its explanation
- Not explaining the effectiveness and performance of the company
Example of McKinsey 7S Model CM
Some of the main examples of McKinsey 7S model for change management or McKinsey 7S Model with example of Nokia are as follows;
Nokia – Change Failure
Strategy
Nokia faced the problems and issues like improving security, better performance, and cost efficiency. While dealing with performance and innovation, the company followed a cost leadership approach and it failed.
Structure
Nokia used to follow the top-to-bottom hierarchical structure where there was limited communication at different levels. While competing against Samsung and Apple, Nokia should have followed the decentralized and collaborative approach.
System
Nokia used to consider agility its competitive. The skilled workforce of the company could have helped the company to achieve operational efficiency and innovation.
Shared Values
The core values that help a company to achieve high performance; they’re challenge, renewal, achievement, and respect.
Style
Employees motivation level was and the company’s leadership didn’t have the tech expertise. Instead of including tech people in the management that could have promoted innovation and growth, and the company required transformational changes in the leadership.
Skill
Nokia used to have highly proficient and skillful engineers in the mobile phone industry; there wasn’t any skill gap.
Staff
Nokia finished the CTO position from the top management from 2007 to 2010; the new management didn’t have sufficient tech expertise. It resulted in the form of the failure of the top brand.
Conclusion: McKinsey 7S Model Change Management | McKinsey 7S Model with example of Nokia
After an in-depth study of McKinsey 7S model change management; we have realized that the 7S model framework helps you to analyze a company’s structure. If you are learning about the 7S framework for change management; then you should keep in mind the abovementioned elements, benefits, challenges, and McKinsey 7S Model with example of Nokia.
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