Apple McKinsey 7S Model
Apple McKinsey 7S model illustrates the ways in which seven elements of businesses can be aligned to increase effectiveness. According to this model, 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
Hard Elements in Apple McKinsey 7S Model
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 iPod, 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 it’s 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.
Furthermore, the multinational technology company has developed a strategy to reduce dependence of the business on the sale of iPhones. This strategy involves putting greater emphasis on services divisions of the business and more investments on research and development of new products and services. The iPhone maker has also specified unparalleled customer experience as a cornerstone of its business strategy.
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. Two main elements of Apple organizational structure can be specified as product-based grouping and effective collaboration between groups and divisions throughout the company.
Functionality can be specified as another important element of Apple organizational structure. Although, product-based and project based teams effectively operate to contribute to the bottom line, the line of reporting and supervision is functional. Specifically, senior vice presidents reporting to CEO are in charge of functions such as marketing and engineering, not products.
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, employee performance appraisal, team development and orientation systems. Moreover, the multinational technology company depends on transaction processing systems, business intelligence and knowledge management systems.
Apple employee recruitment process comprises the following stages:
- Pre-recruitment: announcement of a vacancy with job description and requirements
- Candidate screening: screening for candidates who meet the basic qualification criteria
- Hiring event: meeting and interacting with candidates to assess if they will fit Apple organizational culture
- Interview: one-to-one or group interview that might involve role-playing activities
- Second interview: individual interviews where deeper questions are asked to assess the suitability of candidate to the role
- Third interview: the last interview with a higher level manager, where more technical questions are asked
- Background checks: hiring managers check references of candidates and law enforcement records as the last stage of recruitment process before making a job offer.
Moreover, the competitive advantage of the world’s largest IT company by revenue is based on effective new product development systems to a greater extent compared to other systems. Specifically, the company places design at the forefront of the new product development process and the design teams are separated from the larger company in order not to compromise their focus. Moreover, “the design process at Apple is not over when manufacturing begins. In fact, Apple iterates the design throughout manufacturing. The product is built, it’s tested and reviewed, then the design team improves on it and it’s built all over again.”[1]
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.
[1] Apple’s Product Development Process – Inside the World’s Greatest Design Organization (2019) Interaction Design Foundation, Available at: https://www.interaction-design.org/literature/article/apple-s-product-development-process-inside-the-world-s-greatest-design-organization