The Ithaca Beer Company: A Case Study of the Application of the McKinsey 7-S Framework
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Tracey, J. B.; Blood, Brendan
An analysis of the Ithaca Beer Company demonstrates how the McKinsey-developed 7-S model can be used to assess a company’s competitive and strategic position. The model itself proposes that the following seven key points should be in alignment: strategy, structure, systems, staff, skills, style, and shared values, the last of which is central to the other six elements. Relatively small by the standards of the U.S. brewing industry, Ithaca Beer Company (IBC) is a craft beer brewer with a gradually expanding regional distribution. Based on interviews and other analysis, four of the seven factors in the 7-S model clearly are aligned and critical for this company’s success. They are strategy, staff, skills, and shared values. Briefly, IBC’s strategy is one of community involvement and careful attention to distributors, retailers, and customers. Its relatively small staff is enthusiastic about the product, has strong skills, and works collaboratively. Although the other three S factors do not seem to be so critical at the moment, they may come into play as IBC continues to grow and expand. Thus, while the 7-S analysis is useful in highlighting a company’s strengths and challenges, a contingency approach may be the most appropriate, with certain factors being more salient than others at any particular time.
McKinsey 7-S; brewery; positon assessment; company values
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