Published December 25, 2006

The Seven S Model: Business Analysis Model

Typically, the 7S model is used in large corporations. Often, those companies have a hard time getting a handle on their situation and their potential because they are fragmented across continents, business units, confusing conglomerates, or constant acquisition and shuffling. The 7S model gives the multifaceted company a single set of metrics with which to analyze.

I believe that 7S is just as appropriate (on a smaller scale, of course) for the smaller business. But before we look at how it's helpful, let's consider what the 7S's are.

The 7S's were created by Robert H. Waterman, Julien R. Phillips, and Tom Peters (the most well-known of the group because of his book In Search of Excellence).

They are a group of interrelated categories which make up an organization. Like rowers in a boat, when they are all aligned, a business will likely succeed, prosper, innovate, and move in the direction it wants to move. When these factors are not aligned the business can fail, remain stagnant, reach maturity or decline quickly, or flounder about.

The Seven S's

  • Structure: This is more than just the stated hierarchy of the organization. This is the "in practice" hierarchy, too. Is a business focused on the customer? Is it segmented by function? Is it segmented by geography? Is it top heavy with a lot of decision-making executives?
  • Systems: This is the process through which the company gathers information and makes decisions. If it's effective, a company can react quickly and appropriately to changes in the marketplace. If a company's systems are not adequate, the company stands the risk of being ponderous.
  • Skills: This is the collective skill set of the organization. If a company determines to hire only people who can speak two or more languages, they will quickly fill their ranks with skilled people who allow them to communicate to other people more effectively. Some companies in the early growth stages can react to a need by hiring too many people in one skill category and run the risk down the road of having a variety of absent skills. There is no perfect mix, this is a matter of constantly balancing and rebalancing based on need.
  • Style: This category is about the culture of the company. Is it aggressive? Is it conservative? Is it innovative? Is everyone happy? Does the company feel bloated and unwieldy? Each company has its own style and that style is set by the leadership and supported (or changed) by the mix of staff hired.
  • Staff: This category, obviously, deals with the people in the organization. It involves not only their skills (mentioned in another S) but also whether or not there are enough (or too many) staff members to do the job as well as the personal and professional goals that each person has.
  • Superordinate goals (which later was appropriately renamed Shared Values):This category talks about the overarching purpose in the organization more specifically, it deals with the real or practiced values and compares them to the stated values. A company, for example, may claim to be customer-centered but in reality it could reward staff for high volumes of sales, encouraging staff to ignore the customer and focus on making their numbers.
  • Strategy: Strategy deals with tomorrow- what is the company planning on achieving in the future and what are they doing today to prepare for those goals?

Now that you've enjoyed a basic "business 101" lesson, we'll look at how the 7S model can have a positive impact on your business in The Seven S Model (Part 2).