The McKinsey 7S Model for Product Managers

Rohit Verma
7 min readApr 18, 2024

How can product managers not only survive but thrive in the whirlwind of today’s market? Beyond innovation and development, there lies a powerful framework poised to elevate product management to unparalleled heights.

Enter the McKinsey 7S Model, a toolkit designed for dissecting and enhancing organizational effectiveness.

The McKinsey 7S Model is a management tool developed in the 1980s by Tom Peters and Robert Waterman, former consultants at McKinsey & Company. It is designed to analyze and improve organizational effectiveness by examining seven interrelated elements within an organization.

Source : Wikipedia

Understanding the 7S Model

Before diving into its application, it’s crucial to grasp what each “S” stands for:

  • Strategy: The plan devised to achieve overall goals.
  • Structure: How the organization is arranged to support its strategy.
  • Systems: The daily activities and procedures that staff members engage in to get the job done.
  • Shared Values: Core values of the company, originally called “Superordinate Goals.”
  • Style: The cultural style of the organization and how key managers behave in achieving the organization’s goals.
  • Staff: The employees and their general capabilities.
  • Skills: The actual skills and competencies of the organization’s employees.

Application in Product Management

1. Strategy: Aligning Product Vision

Scenario: Imagine a product manager at a tech startup aiming to develop a new fitness app.

Application: The product manager needs to ensure the app’s development strategy aligns with the company’s goal of promoting healthier lifestyles. This might involve prioritizing features that encourage regular exercise and healthy eating. Regular SWOT analyses can help the product team adapt their strategy to changing market conditions or user feedback.

2. Structure: Organizing Teams for Efficiency

Scenario: The fitness app project involves multiple teams, including development, marketing, and customer service.

Application: A product manager can apply the 7S model by structuring these teams to foster collaboration and efficiency. This might involve creating cross-functional teams that work together on specific features, ensuring that each team understands how their work contributes to the app’s overall success.

3. Systems: Streamlining Processes

Scenario: The development of the fitness app involves numerous processes, from user research to product testing.

Application: Implementing effective systems, such as agile methodologies, can help streamline these processes. For example, adopting sprint cycles for feature development and testing allows for quicker feedback loops and more adaptive product evolution.

4. Shared Values: Cultivating a Unified Vision

Scenario: The company’s mission is to make fitness accessible and enjoyable for everyone.

Application: The product manager should ensure that this mission is a core part of the product’s development process. This involves creating a culture that values user feedback, prioritizes accessibility features, and encourages innovation in making fitness fun.

5. Style: Leading by Example

Scenario: The product team is diverse, with members having varying experiences with fitness.

Application: The product manager can lead by example, demonstrating a commitment to the company’s health and fitness values. This could involve organizing team fitness challenges or incorporating wellness practices into team meetings, thereby fostering a culture of health within the team.

6. Staff: Building a Skilled Team

Scenario: The fitness app requires a team with a range of skills, from coding to user experience design.

Application: A product manager using the 7S model will focus on assembling a team that not only possesses the necessary technical skills but also aligns with the company’s fitness-focused mission. This might involve targeted recruiting, investing in employee training, and encouraging a culture of continuous learning.

7. Skills: Leveraging Competencies

Scenario: The market for fitness apps is highly competitive, requiring unique features to stand out.

Application: The product manager must ensure the team’s skills are utilized to create innovative features, such as AI-driven workout personalization or integration with wearable technology. Identifying and developing these key competencies can give the product a competitive edge.

Detailed Example

Let’s take a hypothetical example of a software company, “InnovSoft,” to illustrate how product teams might use the McKinsey 7S Model to generate new ideas and strategies effectively.

Scenario:

InnovSoft specializes in creating productivity tools for small businesses. The company is looking to expand its product line to include tools tailored for remote work environments, a growing market segment. The product team at InnovSoft has been tasked with generating and implementing ideas for this new product.

Application of the McKinsey 7S Model:

1. Strategy: The team begins by re-evaluating InnovSoft’s business strategy to ensure it aligns with entering the remote work tools market. They consider the market demand, competition, and profitability of this venture. The strategy is defined as developing a suite of remote work tools that integrate seamlessly with existing products offered by InnovSoft.

2. Structure: Next, they assess the organizational structure to determine if changes are needed to support the new strategy. It may involve creating a new product development team specifically focused on remote work solutions. This team will need clear roles, responsibilities, and reporting lines to ensure efficiency.

3. Systems: InnovSoft’s existing systems for project management, software development, and customer feedback are evaluated. The team decides to adopt Agile methodologies to increase responsiveness and iterative testing with potential users to refine the product throughout its development cycle.

4. Shared Values: The core values of InnovSoft include innovation, customer focus, and quality. The product team ensures that these values are emphasized in the new project. For instance, customer feedback loops are integrated into all stages of product development to ensure that the tools are genuinely addressing customer needs.

5. Style: Leadership style and company culture are also considered. InnovSoft promotes a culture of open communication and collaboration, which will be vital in a cross-functional project involving multiple departments. The leadership commits to regular check-ins and supports an open-door policy to encourage innovation and address issues promptly.

6. Staff: Assessing the skills and capabilities of the current workforce is critical. The team identifies a gap in expertise related to cloud-based technology and decides to recruit two new software engineers with experience in cloud solutions. Additionally, existing staff members are offered training sessions to upskill.

7. Skills: Finally, the product team reviews the overall skills available within the company. Besides technological skills, they recognize the need for strong project management and user experience design skills. To fill these needs, they plan to leverage internal resources and consider external consultants for specialized roles.

Execution:

With the strategy and corresponding elements aligned, InnovSoft begins developing the new product. They start with a minimum viable product (MVP) that includes basic features identified as essential by their initial market research. Throughout the development process, each element of the 7S model is continuously revisited to ensure alignment and adapt to any new challenges or opportunities that arise.

Real World Case Studies

Case Study 1: Google

Background: Google has long been known for its innovative products and unique company culture.

Application: Google exemplifies the 7S model particularly through its emphasis on Style, Staff, and Shared Values.

Specifics:

  • Style: Google encourages a flat, open culture that promotes communication and collaboration.
  • Staff: They focus on hiring top talent with a diverse range of skills.
  • Shared Values: Innovation and creativity are central values at Google.

Outcome: This alignment has enabled Google to continually innovate and maintain its position as a leader in the technology industry.

Case Study 2: Apple

Background: Apple is recognized for its strong product differentiation and effective execution.

Application: Apple’s success can be attributed to strategic alignment across all the 7S elements, but particularly in Strategy, Skills, and Systems.

Specifics:

  • Strategy: Apple maintains a clear, consistent strategy focused on innovation, quality, and a premium user experience.
  • Skills: They invest heavily in their R&D capabilities to innovate continually.
  • Systems: Robust processes support everything from product development to supply chain management.

Outcome: Apple consistently delivers successful products that align with their business strategies and customer expectations.

Final Thoughts

By applying the McKinsey 7S Model, product managers can ensure that every aspect of their product development process is aligned and optimized for success. From strategizing and structuring to cultivating shared values and leveraging staff skills, the 7S framework provides a holistic approach to managing products in a complex and ever-changing market landscape. Through practical application of each “S,” product managers can navigate challenges more effectively, leading to products that not only meet market needs but also exceed user expectations.

Thanks for reading! If you’ve got ideas to contribute to this conversation please comment. If you like what you read and want to see more, clap me some love! Follow me here, or connect with me on LinkedIn or Twitter.
Thanks for reading! If you’ve got ideas to contribute to this conversation please comment. If you like what you read and want to see more, clap me some love! Follow me here, or connect with me on LinkedIn or Twitter.

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Rohit Verma

Senior Product Manager @AngelOne, ex-@Flipkart, @Cleartrip @IIM Bangalore. https://topmate.io/rohit_verma_pm