The Easy Guide to the McKinsey 7S Model
Guide to Mckinsey's 7s model

Although invented in the late 1970s, the McKinsey 7S model still helps businesses of all sizes succeed. A conceptual framework to guide the execution of strategy. 

In this guide, we’ll walk you through the 7S of the McKinsey Framework and how to apply it to evaluate and improve performance. 

McKinsey 7-S Model Definition 

The McKinsey 7S model is one of the most popular strategic planning tools.  Businesses commonly use it to analyze internal elements that affect organizational success. 

The model recognizes 7 of these elements and considers them to be interlinked, therefore it’s difficult to make significant progress in one area without making progress in other areas as well. Accordingly, to be successful, the organization should ensure that all these elements are aligned and reinforced.

The model divides these 7 elements into two categories;

Hard elements – Strategy, Structure, Systems (these are easier to be identified and defined and can be directly influenced by the management)  

Soft elements – Shared Values, Skills, Style, Staff (these are harder to be defined because they are less tangible, but are just as important as the hard elements) 

You can use the framework 

  • To successfully execute new strategies
  • To analyze how different key parts of your organization work together
  • To facilitate changes in the organization 
  • To help align processes during a merger or acquisition
  • To support management thinking during strategy implementation and change management

The 7 Elements of the McKinsey 7-S Framework 

  1. Strategy
  2. Structure
  3. Systems
  4. Skills
  5. Staff
  6. Style
  7. Shared values

Let’s dig into these elements in more detail. 

Strategy 

A strategy is a plan the company develops to maintain its competitive advantage in the market. It consists of a set of decisions and action steps that need to be taken in response to the changes in the company’s external environment which includes its customers and competitors. 

An effective strategy would find external opportunities and develop the necessary resources and capabilities to convert the environmental changes into sources of new competitive advantage. 

Structure

The structure is the organizational chart of the company. It represents how the different units and divisions of the company are organized, who reports to whom and the division and integration of tasks. The structure of a company could be hierarchical or flat, centralized or decentralized, autonomous or outsourced, or specialized or integrated. Compared to most other elements, this one is more visible and easier to change. 

Organizational Structure Template for McKinsey 7S Model
Organizational Chart (Click on the template to edit it online)

Systems 

These are the primary and secondary activities that are part of the company’s daily functioning.  Systems include core processes such as product development and support activities such as human resources or accounting. 

Skills

Skills are the skill set and capabilities of the organization’s human resources. Core competencies or skills of employees are intangible but they a major role in attaining sustainable competitive advantage. 

Staff

The most valuable strategic asset of an organization is its staff or human resources. This element focuses on the number of employees, recruitment, development of employees, remuneration and other motivational considerations. 

Style

This refers to the management style of the company leadership. It includes the actions they take, the way they behave, and how they interact.  

Shared Values

Shared values are also referred to as superordinate goals and are the element that is in the core of the model. It is the collective value system that is central to the organizational culture and represents the company’s standards and norms, attitudes, and beliefs. It’s regarded as the organization’s most fundamental building block that provides a foundation for the other six elements. 

McKinsey 7S Model
McKinsey 7S Model (Click on the template to edit it online)

How to Use the McKinsey 7-S Model

The model can be used to do a gap analysis or to determine the gap between what the company is currently doing and what it needs to do to successfully execute the strategy. 

Step 1: Analyze the current situation of your organization

This is where you need to understand the current situation of the organization with regard to the 7 elements. Analyzing them closely will give you a chance to see if they are aligned effectively.

The following checklist questions will help you explore your situation. 

Strategy 

  • What’s the objective of your company strategy? 
  • How do you use your resources and capabilities to achieve that?
  • What makes you stand out from your competitors? 
  • How do you compete in the market? 
  • How do you plan to adapt in the face of changing market conditions?

Structure

  • What’s your organizational structure?
  • Who makes the decisions? Who reports to whom? 
  • Is decision-making centralized or decentralized?
  • How do the employees align themselves to the strategy?
  • How is information shared across the organization?

Sytems

  • What are the primary processes and systems of the organization? 
  • What are the system controls and where are they?
  • How do you track progress?
  • What are the processes and rules the team sticks with to keep on track? 

Skills

  • What are the core competencies of the organization? Are these skills sufficiently available? 
  • Are there any skill gaps?
  • Are the employees aptly skilled to do their job? 
  • What do you do to monitor, evaluate and improve skills? 
  • What is it that the company is known for doing well? 

Staff

  • How many employees are there? 
  • What are the current staffing requirements? 
  • Are there any gaps in the required resources? 
  • What needs to be done to address them?

Style

  • What is the management style like? 
  • How do the employees respond to this style?
  • Are employees competitive, collaborative or cooperative? 
  • What kind of tasks, behaviors, and deliverables does the leadership reward? 
  • What kind of teams are there in the organization? Are there real teams or are they just nominal groups? 

Shared Values

  • What are the mission and vision of the organization? 
  • What are your ideal and real values? 
  • What are the core values the organization was founded upon? 
  • How does the company incorporate these values in daily life? 

Step 2: Determine the ideal situation of the organization 

Specify where you ideally want to be and the optimal organizational design you want to achieve, with the help of the senior management. This will make it easier to set your goals and come up with a solid action plan to implement the strategy. 

Since the optimal position you want to be in is still not known to you, you will have to collect data and insight through research on the organizational designs of competitors and how they coped with organizational change. Answering the questions above are just the starting point. 

To understand what your organization is best at, use the Hedgehog Concept by Jim Collins

Step 3: Develop your action plan

Here you will identify which areas need to be realigned and how you would do that. The result of this step should be a detailed action plan listing the individual steps you need to take to get to your desired situation, along with other important details such as task owners, timeframes, precautions and so on.

Action Plan Template for Applying McKinsey 7S Model
Action Plan Template (Click on the template to edit it online)

Step 4: Implement the action plan 

Successfully executing the action plan is depended on who executes it. Therefore you need to make sure that you assign the tasks to the right people in your organization. Additionally, you can also hire consultants to guide the process. 

Step 5: Review the seven elements from time to time

Since the seven elements are subjected to constant change, reviewing them periodically is essential. A change in one element will affect all the others, which will require you to implement a new organization design. Review the situation frequently to stay aware of the remedial action you might want to take.

Advantages and Disadvantages of McKinsey 7-S Model 

Advantages

  • Considers 7 elements of strategic fit, which is more effective than the traditional model that only focuses on strategy and structure
  • It helps align the processes, systems, people, and values of an organization
  • Since it analyzes each element and the relationship between them in detail, it ensures that you miss no gaps caused by changed strategies
  • Helps organizations identify how they should align the different key parts of the organization to achieve their goals

Disadvantages

  • It requires the organization to do a lot of research and benchmarking, which makes it time-consuming
  • It only focuses on internal elements, while paying no attention to the external elements that may affect organizational performance.
  • It requires the help of senior management which may not be readily available depending on how busy they are

To analyze and understand the performance or the functioning of the organization use Weisboard’s six box model framework.

What’s Your Take on the McKinsey 7-S Model? 

The McKinsey 7S model is a proven framework for helping organizations understand how to get from their current situation to the situation they prefer to be in. 

Maybe you are a big fan of the McKinsey 7S model. Maybe you prefer another strategy framework that has worked well for you. We’d love to hear what you feel about the subject; give your feedback in the comments section below. 

8 Gap Analysis Tools to Identify and Close the Gaps in Your Business
gap-analysis-tools

Not sure what’s working in your business—or why certain goals haven’t been met? A gap analysis helps you compare where you are now to where you want to be, so you can pinpoint what’s missing and why. With the right gap analysis tools, you can uncover performance issues, missed opportunities, and the best steps to close the gap.

In this guide, you’ll find 8 essential tools and and templates to run an effective gap assessment from start to finish. Scroll down to find out,

Gap Analysis Tools

Once you have identifies what the gaps are, you need to look into why they exist and what you can do about them. There are a few gap analysis models you can use for this task. Following we have listed a few Gap analysis techniques that you can use.

1. SWOT

SWOT analysis focuses on Strengths and Weaknesses in the internal environment and Opportunities and Threats in the external environment. It helps you determine where you stand within your industry or market.

SWOT-Analysis-Diagram-Template-2
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How to do it;

  1. Gather around a team from relevant teams/ departments
  2. Create a SWOT analysis matrix; you can either use the one below or choose from these SWOT analysis examples
  3. List down the internal strengths and weaknesses of your business
  4. Note down the opportunities and threats present in the industry/ market
  5. Rearrange each bullet point in the order of highest priority at the top, and lowest at the bottom
  6. Analyze how you can use your strengths to minimize weaknesses and fight off threats, and how you can use the opportunities to avoid threats and get rid of weaknesses

Use Creately’s AI SWOT analysis template to generate a tailored SWOT matrix instantly, with AI suggestions to help identify key factors and insights faster.

AI SWOT Analysis
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2. Fishbone

A fishbone diagram, also known as a cause and effect diagram or Ishikawa diagram, helps you identify the root cause of an issue or effect. It lists the 6 Ms (listed in the diagram below) and helps you see how they relate to the central problem.

How to do it;

  1. Write the main issue at the “head” of the diagram (the right side).
  2. Draw the spine – A horizontal line pointing to the problem.
  3. Add branches for categories. Use the 6 Ms (Manpower, Methods, Machines, Materials, Measurements, and Mother Nature/Environment) or categories relevant to your context.
  4. Brainstorm causes. Under each category, list specific possible causes that may contribute to the problem.
  5. Work with your team to identify which causes are most likely at the root.
Fishbone Diagram Example
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Get more fishbone diagram examples.

3. McKinsey 7S

McKinsey 7S can help you with any of the following purposes

  • To help understand the gaps that may appear in the business
  • Identify which areas to optimize to boost business performance
  • Align processes and departments during a merger or acquisition
  • Examine the results of future changes within the business

The 7s refer to key interrelated elements of an organization. They are as follow,

McKinsey 7S Model
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These elements are divided into two groups: hard elements, which are tangible as they can be controlled, and soft elements, which are intangible as they cannot be controlled.

Hard elements

  • Strategy – the plan of action that will help your business gain a competitive advantage
  • Structure – the organizational structure
  • Systems – business and technical infrastructure that employees use to do their daily tasks

Soft elements

  • Shared values – a set of beliefs or traits that the organization upholds
  • Style – the leadership style of the organization and the culture of interaction
  • Staff – the general staff
  • Skills – key skills of employees

How to apply it;

  1. Gather around a competent team
  2. Check whether the elements are properly aligned with each other (look for gaps and weaknesses in the relationship between the elements)
  3. Define the state where these elements would be optimally aligned
  4. Come up with an action plan to realign the elements
  5. Implement the changes and continuously review the 7s, moving forward

Here’s a more detailed look at how to apply the McKinsey 7s model.

4. Nadler-Tushman’s Congruence Model

Nadler-Tushman’s congruence model is used to identify performance gaps within an organization.

It is based on the principle that a business’s performance is a result of these 4 elements: work, people, structure, and culture. The higher the compatibility among these elements, the greater the performance will be.

Click on the template to edit online

How to apply it;

  1. Gather all data that points to the symptoms of poor performance
  2. Specify and analyze inputs that include the environment, resources, and history. And define your organization’s strategy.
  3. Identify which outputs are required at the individual, group, and organizational levels to meet the strategic objectives
  4. Figure out the gaps between desired and actual output and the problems associated with it (and mark down the costs associated with them as well)
  5. Collect data on and describe the basic nature of the 4 major components of  the organization
  6. Assess the degree of congruence among these components
  7. See how poor congruence and problems related to outputs are correlated. Check if the poor ‘fit’ of the 4 major components is related to  the problems
  8. Come up with action steps to deal with the problem causes

Check out this resource for more in-depth instructions on how to apply the Congruence model.

5. Burke-Litwin Causal Model

This gap assessment tool helps you understand how the different components of an organization relate to each other when going through a period of change. There are 12 components that are interrelated and they are as follows,

Example of Burke-Litwin Diagram Template
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How to apply it:

  1. Find out where the need for change is coming from; whether from the external environment, transformational factors, etc.
  2. Identify which of the elements in each group is responsible for the situation
  3. Examine the key element along with the other 11 elements; pay special attention to those that are closely linked to the identified element
  4. Figure out the changes you need to make to the main element, along with the other few elements it is closely linked to

Learn more about the 12 drivers of change, the Burke-Litwin highlights here.

6. PEST or PESTLE Analysis

PEST or PESTLE analysis is a strategic tool used to evaluate external factors that can affect an organization. It helps compare how well your current strategies align with external trends. Gaps are often found where the business is unprepared for external shifts (e.g., regulatory changes, economic downturns).

  • PEST stands for Political, Economic, Social, and Technological factors.
PEST Analysis Template for Gap Analysis Tools
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Use the AI PEST analysis template to quickly generate a structured analysis with key prompts and editable sections tailored to your focus area.

AI PEST Analysis Template
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  • PESTLE adds Legal and Environmental to the mix.
PESTLE Analysis Template for Gap Analysis Tools
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Explore the AI PESTLE analysis template to map out trends, risks, and potential disruptions in each category.

AI PESTLE Analysis Template
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How to apply it: 

  1. Identify the external environment you’re analyzing (e.g., a specific market, country, or region).
  2. Under each category (Political, Economic, etc.), list factors that could impact your business goals.
  3. Assess how each factor affects your current operations versus your desired future state.
  4. Use the insights to pinpoint external gaps and risks in your strategy or planning.

7. Benchmarking

​​Benchmarking is the process of comparing your business performance, processes, or metrics against industry best practices or top competitors to identify gaps. Benchmarking reveals where you’re underperforming and helps prioritize improvement areas based on what competitors or top performers are doing better.

How to apply it:

  1. Select the process or metric you want to benchmark (e.g., customer service response time).
  2. Identify industry leaders or standards to compare against.
  3. Collect data on your current performance and that of the benchmarked entities.
  4. Analyze the differences and determine why the gap exists.
  5. Develop strategies to close the performance gap.

8. Porter’s Five Forces

Porter’s Five Forces is a framework for analyzing the competitive forces in an industry to determine its attractiveness and identify strategic gaps. It helps identify gaps in competitive strategy, like areas where your offering is weak compared to rivals, or where new entrants could disrupt your market.

Porter’s Five Forces for Gap Analysis Tools
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The five forces are:

  1. Competitive Rivalry
  2. Threat of New Entrants
  3. Bargaining Power of Suppliers
  4. Bargaining Power of Buyers
  5. Threat of Substitute Products or Services

How to apply it:

  1. Evaluate each of the five forces in the context of your industry.
  2. Assess how each force impacts your market position.
  3. Identify weaknesses or threats—such as strong buyer power or high competition—that create strategic vulnerabilities.
  4. Use this analysis to understand where you need to build competitive strength.

Using AI for Conducting Your Gap Analysis

The AI gap analysis template in Creately uses the power of Creately AI, to simplify the entire process. Just input your current state, goals, or performance data, and the AI will generate a visual analysis highlighting key gaps and suggested actions.

AI Gap Analysis Template
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How it works:

Step 1. Select the AI gap analysis template from the template library.

Step 2. Enter your inputs: current performance, goals, or specific challenges.

Step 3. Let the AI generate the gap map, complete with labeled stages, connections, and action points.

Step 4: Customize the output and collaborate with your team to refine and implement solutions.

This template is ideal for teams looking to save time, reduce manual effort, and make faster, data-driven decisions across areas like strategy, operations, HR, and marketing.

What’s Your Take on Gap Analysis Tools?

Gap analysis is a great way to figure out the parameters of your next project or your process improvement efforts. We’ve covered 5 types of Gap analysis tools that you can use to identify gaps in your business and determine what you should do next.

Let us know what other Gap analysis tools you use during a Gap analysis process at your organization.

And if you are looking for Gap analysis templates, we’ve got you covered! Check out this compilation of useful Gap analysis templates that you can use for multiple scenarios