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From the book The Art of Japanese Management ( a study of Matshushita and ITT
Corporations) by Prof. Richard Pascale (Stanford Univ) and Anthony Athos (Harvard Univ).
McKinsey 7- S Model
Premise: For an organization to perform well, seven elements need to be
aligned for mutual reinforcement. It identifies the areas needing realignment
in order to improve performance during change processes.
(Tom Peters & Robert Waterman, 1980)
structure
Hard Ss
strategy
systems
shared
values
Soft Ss
skills
styles
staff
HARD Ss
SOFT Ss
Staff is inappropriate.
Structure Large component of outsourced activities. Many contractual employees.
Systems Focus on Staff acquisition and Training. Centralized decision making. Strong
ERP systems.
Strategy Focus on holding current market position.
1.
HARD Ss
Strategy is a plan or course of action in allocating resources to achieve
identified goals over time. Unlike tactic, strategy is well thought and often
rehearsed. It transforms the organization from the present position to the
new position described in the objectives, subject to constraints of the
capabilities (Ansoff, 1965).
HARD Ss
Structure is the skeleton, the form of shape, of organizations. It dictates the
way it operates and performs (Waterman et al., 1980). Traditionally,
businesses are structured with divisions, departments and layers, in which
the lower layers answer to upper layers. Today, the flat structure, where the
work is done in teams of specialists, are more common. The idea is to make
the organization more flexible and devolve the power by empowering the
employees and eliminate the middle management layers (Boyle, 2007).
HARD Ss
Systems are routine processes and procedures followed within an
organization to implement the strategy and to run day-to-day affairs. These
processes are mainly designed to achieve maximum effectiveness.
Traditionally, the higher management makes the most decisions.
Increasingly, the organization are using innovation and new technology to
make decision-making process quicker
1.
2.
3.
4.
SOFT Ss
Staff are personnel categories within the organization, such as
engineers, sales persons, etc. Unlike traditional organizations, new
leading organizations put more emphasis on hiring the best staff and
and with rigorous training and monitoring support shape the basic
values. This forms the basis of these organizations strategy and competitive
advantage over their competitors (Purcell and Boxal, 2003).
SOFT Ss
Skills are the capabilities of the staff within the organization as a whole.
1.
2.
3.
4.
5.
SOFT Ss
Style is the way in which key managers behave in achieving organizational
goals, that is the management style. It includes the dominant values, beliefs
and norms which develop over time and become relatively enduring features
of the organizational life. Different from the traditional businesses in which
strict adherence to the upper management and procedures was expected
from the lower-rank employees, the recent businesses have been more open,
innovative and friendly with fewer hierarchies and a smaller chain of
command.
1.
2.
3.
4.
SOFT Ss
Shared Value refers to the significant meanings or guiding concepts that
organizational members share (Peters and Waterman, 1982). These values
and common goals keep the employees working towards a common
destination as a coherent team. The organizations with weak values and
common goals often find their employees following their own personal goals
that may be conflicting with others.
1.
2.
3.
4.
End