Introduction
This report aims to provide a plan for implementing a business strategy for Twitter based on McKinsey’s 7 Framework. It was previously stated that Twitter had been struggling to generate revenue effectively; thus, new strategic initiatives are necessary. The suggested strategic initiative is introducing a subscription system allowing Twitter users to use premium features for a monthly payment. It was also suggested that Twitter start offering benefits that other platforms lack to become distinguished from its competitors, attract new users, and retain the old ones. This strategic initiative will be elaborated through McKinsey’s 7 Framework and the GANTT chart and evaluated by applying the balanced scorecard.
Strategy Implementation
The suggested strategic initiative that needs to be implemented is introducing a subscription service plan for Twitter users. It is necessary to develop an implementation plan for this strategy because of the possibility of generating additional revenue streams, which Twitter has been struggling with lately. By allowing users to access exclusive content or features absent in other services, Twitter will reduce its dependency on revenue from advertising. The level of user engagement, as well as their retention, will increase due to the growing level of user satisfaction.
The framework for elaborating the strategic plan for the implementation of this suggestion is the McKinsey 7S framework. This framework includes the following components: strategy, structure, systems, shared values, skills, staff, and style. This framework will help to ensure that all the internal elements of the strategy are aligned so that the subscription service plan is successfully introduced (Jansson, 2020).
The steps in applying this framework will be as follows: First, the strategy’s objectives must be defined. Then, the organizational structure, such as roles and decision-making processes, must be determined (Demir & Kacaoglu, 2018, p. 115). The technological systems are then set, and the implementation is aligned with the company’s shared values. Finally, the necessary competencies and staffing levels will be determined, and the leadership style will be adjusted. The table below lists some of the key actions in McKinsey’s 7S Framework for successfully implementing the subscription service plan.
Table 1: McKinsey’s 7S Strategic Initiative: Introducing a Subscription Plan for Twitter Users
Compared with Twitter’s current 7S framework, some aspects must be altered to implement the suggested strategic initiative. Firstly, the structure, the systems, and the staff need to be adjusted to meet the requirements for implementing the new service. With the current staffing levels and responsibilities, the structure is not ready to support the new strategy.
The most crucial step is to adjust the systems because a subscription service requires the use of technological systems that are fundamentally new to Twitter’s current operating system (Burgess & Baym, 2022). In particular, the new service will require adding new payment processing systems, as currently, users do not pay for any services besides advertising. The user authentication system will also need to be altered.
Another strategic plan issue is adjusting the new initiative to the established values. The organization must be consistent in its values to avoid losing the client base (Elsbach & Stigliani, 2018). For a new strategy to be accepted by the target market, the organization must explain how the new service aligns with Twitter’s values. This can be a problem because one of the established values is open communication; thus, some might perceive establishing a premium subscription service as contradictory.
Transformational leadership is necessary here, as this leadership style is applied when an innovative approach is required (Hansbrough & Schyns, 2018). Twitter’s leadership style is combined, so it could be helpful to emphasize transformational leadership. The actions mentioned in Table 1 are presented in the following Gantt chart.
The present Gantt chart, as can be seen, distributes the necessary adjustments in McKinsey’s 7S that are to be implemented in quarters 3 and 4. The main tasks that take the longest to accomplish are the structure, systems, and staff adjustments, as the new service requires changes primarily in these aspects. Further, a trial period of the service operation will be necessary. As for the alignment between macro-level and industry-level, the implementation is aligned with the growing trend towards subscription-based business models, with the same trend spreading on the industry level.
Overall, the organization’s internal needs and macro and industry trends require the new strategic initiative of launching a subscription payment service. This strategy can help diversify revenue sources and increase customer engagement. The strategy requires structural changes in the McKinsey 7S framework, particularly changes in systems and staff, which are to be completed in quarters 3 and 4.
Evaluating and Measuring Strategic Initiatives
After the strategy is implemented, it is necessary to determine to what extent the implementation has been successful and how satisfactory the results have been. An understanding of these aspects is achieved through evaluation (Samimi, 2020). Evaluation helps the decision-makers to identify the areas for improvement and see what changes need to be introduced (Grant, 2021).
One of the evaluation tools is the balanced scorecard or the strategy map. The balanced scorecard helps to measure the results from the financial, customer, process, and learning perspectives (Beausoleil, 2022). Below is the balanced scorecard for the suggested strategy combined with a strategy map.
Table 2: BSC/Strategy map (Twitter)
In the table, it can be seen that all of the objectives are interconnected. Increasing the percentage of trained employees directly impacts the quality of subscription and customer service. When the quality of the services is improved, the number of technical errors and the time spent on solving customer complaints are reduced, and customer satisfaction grows (Suwanda, 2022).
Customer satisfaction, in turn, is the defining factor for a growing number of subscribers. The more satisfied customers are, the more likely they are to recommend the service to other users and continue using it themselves (Skrob, 2022). The number of users increases profitability and revenue later; thus, all the targets can be met. The evaluation can be conducted by comparing the final results with the financial, customer, processes, learning objectives, and targets set in the balanced scorecard and strategy map.
Key Lessons
The following insights were obtained from the three branches of strategy: strategy context, content, and process. Regarding strategy context, it was concluded that the competition between Twitter and other social media platforms was high; thus, it was necessary to build a successful strategy to compete in the market. One of the insights from the strategy content is that establishing a subscription service could be a strategic initiative that can help increase revenue and competitiveness. Finally, the strategy process demonstrated that to implement the initiative, it is necessary to introduce structural changes, changes in the system and the staff, which can later be converted into tangible results evaluated with the help of the balanced scorecard.
Reference List
Beausoleil, A. M. (2022) Business design thinking and doing: Frameworks, strategies and techniques for sustainable innovation. Springer International Publishing.
Burgess, J. and Baym, N. K. (2022) Twitter: A Biography. New York: NYU Press.
Demir, E. and Kocaoglu, B. (2019) ‘The use of McKinsey 7S Framework as a strategic planning and economic assessment tool in the process of digital transformation’, PressAcademia Procedia, 9, pp. 114-119.
Elsbach, K. D. and Stigliani, I. (2018) ‘Design thinking and organizational culture: A review and framework for future research’, Journal of Management, 44(6), pp. 2274-2306.
Grant, R. M. (2021) Contemporary strategy analysis. 11th edn. John Wiley & Sons.
Hansbrough, T. K., and Schyns, B. (2018). ‘The Appeal of Transformational Leadership’, Journal of Leadership Studies, pp. 1-14.
Jansson, H. (2020) International business strategy in complex markets. Edward Elgar Publishing.
Samimi, R. (2020) Unified theory of business strategy. Sentinel9 Pty Limited.
Skrob, R. (2022) Subscription success: The 9 proven models for exponential subscription growth. Membership Services, Incorporated.
Suwanda, B. Y. N. (2022) ‘Literature Reviews: McKinsey 7S Model to Support Organizational Performance’, Technium Social Sciences Journal, 38(1), pp. 1-9.