Apple McKinsey 7S Model

Apple McKinsey 7S framework illustrates the ways in which seven elements of businesses can be aligned to increase effectiveness. According to the framework, strategy, structure and systems represent hard elements, whereas shared values, skills, style and staff are soft elements. McKinsey 7S framework stresses the presence of strong links between elements in a way that a change in one element causes changes in others. As it is illustrated in figure below, shared values are positioned at the core of Apple McKinsey 7S framework, since shared values guide employee behaviour with implications in their performance.

Apple McKinsey 7S Model

Apple McKinsey 7S Model

Hard Elements

Strategy

Apple pursues differentiation business strategy with a particular focus on the design and advanced features and capabilities of products. The company aims to benefit from the first mover advantage to a maximum extent as it was the case with introduction of iPad, the first device of its kind that stored thousands of songs with simple shuffle capabilities through songs and the development of Macintosh, the first computer to use a graphical user interface. Accordingly, Apple products and services are generally more expensive compared to the competition.

Moreover, Apple business strategy involves the creation of a sort of closed ecosystem, where its various devices and software sync easily and work well with each other. Advantages the company gains from this strategy include high switching costs for customers and this provides the opportunities to leverage relationships with existing customers to offer other products and services.

Greater focus on services is a recent important shift in Apple business strategy. As a result, Revenues from Services segment has been consistently increasing during the last six years to reach USD7 billion in the second quarter of 2017.

 

Structure

During the period of 1997 – 2011, when Steve Jobs was at the helm, everything revolved around him. However, since the takeover of the CEO role by Tim Cook on August 2011, Apple organizational structure and culture has been modified to grant more autonomy for decision making for employees at all levels. Nevertheless, Apple organizational structure still remains to be largely hierarchical due to the large size of the company. Also, project-based teams represent an important feature of Apple’s organizational structure.

Apple organizational structure offers certain advantages such as strong control by senior management, employee motivation due to promotion opportunities and clear division of authority and responsibility within the company. At the same time, there are certain disadvantages such as lack of flexibility of the business and less efficient communication across the business.

 

Systems

Apple business operations rely on a wide range of systems that include but not limited to employee selection and recruitment, IT, finance and employee performance appraisal and others. The competitive advantage of the world’s largest IT company by revenue is based on effective new product development systems. Moreover, Apple business model is unique in a way that the company writes and designs propetriary software and all Apple devices run on company’s own operating system.

Apple Inc. Report contains a full analysis of Apple McKinsey 7S Model. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Ansoff Matrix and Value Chain analysis on Apple. Moreover, the report contains analyses of Apple leadership, business strategy organizational structure and organizational culture. The report also comprises discussions of Apple marketing strategy, ecosystem and addresses issues of corporate social responsibility.

Apple-Inc.-Report

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