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Organization: OverviewofCoreFrameworksFOREWORDANDOBJECTIVEThisdocumentseekstoanswer4questionsMcKinsey’smissionistohavelastingandsubstantialimpactonourclients. Tosucceed,weneedtoworkallthreeofthecriticalelements:choosethebeststrategy,developworld-classoperations,aligntheorganization. Thesethreeelementsbothreinforceandconstraineachother.Thebeststrategyisonlyrelevantifitisoperationallyandorganizationallyfeasible.Theoptimalorganizationaldesigndependsuponthestrategicrequirementandtheoperationalmethodsoftheclient. Thisdocumentfocusesononevertexofthistriangularrelationship.Itwouldbewrong,however,tobelievethatyoucanachievetheimpactweseekbyfocusingononevertex.Weneedtoconsiderallthreeineverystudy.CRITICALELEMENTSFORIMPACTWeonlyachieveimpactwhentheorganizationsweservearesuccessfulinimplementingthestrategiesandoperationalmethodswepropose. However,arecentsurveyofengagementsinwhichclientsfailedtoimplementproposedstrategiesfound,inthreecasesoutoffour,thattheclientorganizationwasnotchange-readyorevencapableofimplementingthestrategyweproposed. Toensurethatwehaveimpact,weneedtoconsiderorganizationalissuesaswedevisestrategies.Wemustchoosestrategiestheclientsarereadyandabletoimplementorcomplementourstrategyworkwithinvestmentinbuildingtheorganization’sskillssothattheorganizationcanstepuptothechallengethesuperiorstrategyposes..3OUTOF4STRATEGIESTHATFAILDOSOBECAUSEOFTHEORGANIZATION’SINABILITYTOEXECUTEThedemandfororganizationalworkisincreasing. Trendsinthemarketplaceandtheevolvingnatureofourclientslargelyexplainthisincreaseindemand. Thepaceofchangeinthemarketplaceisaccelerating.Astrategicchoiceoranoperationalinnovationevokesarapidreactionfromcompetitor.Rarelycanadurablecompetitiveadvantagebefoundinthesechoices.Ratheritisthedevelopmentofauniqueorganizationalcapabilitywiththeinherentflexibilityandcommitmenttosustainworld-classperformancethatprovidesdurablecompetitiveadvantageinthesetimesofrapidchange. Theclientsweservearechangingaswell.Theyhaveincreasinglyhiredin-housestrategiccapabilities.Mo