The First 7 Years

On October 26, 1982, Philippine Seven Corp. (PSC) acquired the license agreement to
use the 7-Eleven Convenience Store system in the entire Philippines from Southland
Corporation of Dallas, Texas. After a month, PSC was registered with SEC on 29 November 1982. The
incorporators were Jose T. Pardo, Vicente T. Paterno and Francisco R. Sibal. The company’s chief mission
was to introduce an entirely new retailing concept to the Filipino consumers, i.e. operating a chain of 24-
hours convenience stores. The first corporate office was located at the ninth floor of the Century Tower
building in Salcedo Village, Makati City.

In order to apply Southland technology in all phases of managing a 7-Eleven convenience store, PSC sent
five of its employees to various Southland installations in the US. The so-called Five-Man Team was
consisted by Francisco R. Sibal, Executive Vice President; Ramon de Jesus, General Manager; Jose
Blanch, Merchandising Manager; Wilfredo Villanueva, Accounting Manager; and Teodoro Wenceslao,
Store Operations Manager. They left on February 15, 1983 to undergo a five-week in-depth training in
their respective fields. Upon their return to the country, the Five-Man Team immediately set out to
practice what they’ve learned from the functional training: site selection, design and construction of the
first 7-Eleven store, negotiation with suppliers, ordering of equipment, recruitment and training of first
batch of employees.

Business Model - What Has Made 7-Eleven Successful

7-Eleven’s business model is fascinating;

it is primarily serving customers across
17 countries globally, especially in Asia
and the Americas. Its core business
provides value to its consumers in
certain ways:

How 7-Eleven Benefits to its Users?

 Best store for people who are on

the go and looking for a one-
stop shop to buy everyday
products
 People easily get morning
breakfast, lunch, and dinner
from its 24-hour operational
stores
 It also offers financial and
payment services in certain areas
 Key Partners

7-Eleven works with different partners in the operation of its business in

Japan and overseas.

These partners fall into the below categories:

Supplier Partners

This comprises various food outlet companies and retailers that provide food and beverages that are
sold at 7-Eleven’s stores.

Franchise Partners

This includes various companies and entrepreneurs that operate 7-Eleven stores on behalf of them.

Branding Partners

Comprises of different marketing and branding companies that collaborate with 7-Eleven for business
and marketing projects.

Key Resources

7-Eleven’s major resources are its products and services, its suppliers, infrastructure, and retail
locations.
It also depends on its IT infrastructure concerning its online store and mobile app.

Revenue Streams – How Does it Make Money

7-Eleven generates revenue through the virtual sale of snacks, drinks, and other products to customers
via its retail stores as well as sales made via its online store and delivery services.

It also generates income from franchising fees from various companies and business owners that
operate stores worldwide.

Latest Innovations

As we have said earlier, 7-Eleven’ nonstop innovations have made them one of the world’s most popular
and largest brands. Let’s have a look at a few of them.

7Reward App

Launched in 2012, the 7Reward App has millions of users as it offers users exclusive offers and allows
them to find nearby stores to get home delivery. To get attractive deals and discounts, users can install
the App Store and Play Store app.

Bill Pay App

The Bill Pay App allows users to pay local bills by scanning barcodes. Launched in 2011, USA customers
use this app to make payments on various bills. Users can install it from the Play Store and App Store.
7-Eleven Now

This is an online app that allows users to obtain products at their doorstep. Consumers can order from
an extensive range of options and make their delivery experience more convenient. Right now, this app
only works in the USA.

Moreover, 7-Eleven also partnered with Postmates in 2015 to make doorstep delivery easy and hassle-
free.

Toshifumi Suzuki, chairman and CEO of Seven and I Holding Co., was widely credited as the mastermind
behind Seven-Eleven Japan's spectacular rise. Although Seven-Eleven Japan began as a small licensee of
U.S. convenience store chain 7-Eleven, Inc. (then Southland Corp.) in 1974, it grew to become the
highest grossing retailer in Japan, eclipsing its then-parent Ito-Yokado's sales. By 2005, it also owned a
controlling stake in 7-Eleven, Inc. Over the years, Suzuki's emphasis on fresh merchandise, innovative
inventory management techniques, and numerous technological improvements guided Seven-Eleven
Japan's rapid growth. At the core of these lies Tanpin Kanri, Suzuki's signature management framework.
7/11 Supply Chain
Mckinsey 7s Framework of Tanpin Kanri Retail Practice at Seven-Eleven Japan
Posted by Matthew Harvey on Feb-11-2020

Introduction

The McKinsey 7s model is a strategic tool and framework that helps managers and businesses assess
their performance. The McKinsey 7s model identifies 7 key elements for an organization that need to be
focused and aligned for successful change management processes as well as for regular performance
enhancements.

The 7 elements identified in the McKinsey 7s model can be categorized as being hard or soft in nature.
They are identified as:

Hard Elements Soft Elements

Shared Values

Strategy Skills

Structure Style
Systems Staff

Tanpin Kanri Retail Practice at Seven-Eleven Japan makes use of the McKinsey 7s model to regularly
enhance its performance, and implement successful change management processes. Tanpin Kanri Retail
Practice at Seven-Eleven Japan focuses on the 7 elements identified in the model to ensure that its
performance levels are consistently maintained, and improved for the offerings.

1. Hard elements

The hard elements of the McKinsey 7s model comprise of strategy, structure, and systems. The hard
elements of the model are easier to identify, more tangible in nature, and directly controlled and
influenced by the leadership and management of the organization.

1.1. Strategy

1.1.1. Clearly defined

The strategic direction and the overall business strategy for Tanpin Kanri Retail Practice at Seven-Eleven
Japan are clearly defined and communicated to all the employees and stakeholders. This helps the
organization manage performance, guide actions, and devise different tactics that are aligned with the
business strategy. Moreover, the business strategy’s definition and communication also make
operations for Tanpin Kanri Retail Practice at Seven-Eleven Japan more transparent and aligns the
responsibilities and actions of the company.

1.1.2. Guiding behavior for goal attainment

The strategic direction for Tanpin Kanri Retail Practice at Seven-Eleven Japan is also important in helping
the business guide employee, staff, and stakeholder behavior towards the attainment and achievement
of goals. SMART Goals are set with short- and long-term deadlines in accordance with the business
strategy. The business strategy helps employees decide tactics and behaviors for attaining the set goals
and targets to help the business grow.

1.1.3. Competitive pressures

Tanpin Kanri Retail Practice at Seven-Eleven Japan’s strategy also takes into consideration the
competitive pressures and activities of competitors. The strategy addresses these competitive pressures
through suggestive measures and actions to address competition via strategic tactics and activities that
ensure sustainability to Tanpin Kanri Retail Practice at Seven-Eleven Japan via adapting to market
changes, and evolving consumer trends and demands.

1.1.4. Changing consumer demands

An important aspect of the strategy at Tanpin Kanri Retail Practice at Seven-Eleven Japan is that it takes
into constant consideration the changing consumer trends and demands, as well as the evolving
consumer market patterns and consumption behavior. This is an important part of the strategic
direction at Tanpin Kanri Retail Practice at Seven-Eleven Japan as it allows the company to remain
competitive and relevant to its target consumer groups, as well as allows the company to identify
demand gaps in the consumer market.
The company then strategically addresses these gaps through product offerings and marketing activities
which give the company successful and leading-edge over other patterns in the market.

1.1.5. Flexibility and adaptability

The strategy at Tanpin Kanri Retail Practice at Seven-Eleven Japan is flexible and adaptable. This is an
important aspect of the strategic direction, and strategy setting at Tanpin Kanri Retail Practice at Seven-
Eleven Japan. Rigidity in strategy leads a company and a business to often become stagnant and
obstructs advancement, and progression with evolving changes in the consumer markets.

With flexibility and adaptability, the Tanpin Kanri Retail Practice at Seven-Eleven Japan is not only able
to benefit from quickly reacting and responding to changing consumer patterns globally, but is also able
to locally and culturally adapt its products via localization for different countries and regions. Moreover,
the company is often able to proactively predict consumer market changes, and devise strategic changes
accordingly to meet the market trends

1.2. Structure

1.2.1. Organizational hierarchy

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a flatter organizational hierarchy that is
supported by learning and progressive organizations. With lesser managerial levels in between and
more access to the senior management and leadership, the employees feel more secure and confident
and also have higher access to information. Moreover, the flatter hierarchy also allows quicker decision-
making processes for Tanpin Kanri Retail Practice at Seven-Eleven Japan and increases organizational
commitment in the employees.

1.2.2. Inter-Departmental coordination

Tanpin Kanri Retail Practice at Seven-Eleven Japan has high coordination between different
departments. The company’s departments often form inter-department teams for projects and tasks
that require multiple expertise. All coordination between different departments is effective and
organized. Tanpin Kanri Retail Practice at Seven-Eleven Japan has a systematic process for initiating and
monitoring coordination between departments to ensure smooth work operations and processes – and
goal attainment.

1.2.3. Internal team dynamics [department specific]

Tanpin Kanri Retail Practice at Seven-Eleven Japan encourages teamwork and team-oriented tasks.
Where jobs require individual attention and scope, the company also assigns individual responsibilities
and job tasks. However, all employees at Tanpin Kanri Retail Practice at Seven-Eleven Japan are
expected to be team players who can work well with and through other members, and who get along
well with other people. The teams at Tanpin Kanri Retail Practice at Seven-Eleven Japan are supportive
of all embers and work in synch with synergy towards achieving the broader team objectives and goals
under the Tanpin Kanri Retail Practice at Seven-Eleven Japan designed strategy and values.

1.2.4. Centralization vs. decentralization

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a hybrid structure between centralization and
decentralization. Like many progressive organizations, Tanpin Kanri Retail Practice at Seven-Eleven
Japan largely supports decentralized decision making. Job roles at Tanpin Kanri Retail Practice at Seven-
Eleven Japan are designed to be carried out with responsibility, and employees often set their goals with
mutual coordination and understanding with the supervisors.

However, Tanpin Kanri Retail Practice at Seven-Eleven Japan is also centralized in making sure that
supervisors oversee, and approve of the various efforts, and tactics that employees choose to ensure
that they are aligned with the organizational strategy ad values.

1.2.5. Communication

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a developed and intricate system for ensuring
communication between employees, and different managerial levels. The communication systems at
Tanpin Kanri Retail Practice at Seven-Eleven Japan enhance the overall organizational structure. The
systematic, defined, and organized communication allows an easy flow of information and ensures that
no organizational tasks and goals are compromised because of a lack of communication, or
misunderstandings.

1.3. Systems

1.3.1. Organizational systems in place

Tanpin Kanri Retail Practice at Seven-Eleven Japan has defined and well-demarcated systems in place to
ensure that the business operations are managed effectively and that there are no conflicts or disputes.
The systems at Tanpin Kanri Retail Practice at Seven-Eleven Japan are largely departmental in nature,
and include, for example:

- Human resource management

- Finance

- Marketing

- Operations

- Sales

- Supply chain management

- Public Relation Management

- Strategic leadership

1.3.2. Defined controls for systems

Each of the defined and demarcated systems at Tanpin Kanri Retail Practice at Seven-Eleven Japan has
especially designed tools and methods as controls for evaluating performance and goal attainment.
These controls and measures are designed specifically in different departments based on the nature of
their tasks and responsibilities. Moreover, each department also designs specific controls for members
for performance evaluation, as well as for inter-departmental tasks and responsibilities.

1.3.3. Monitoring and evaluating controls

Tanpin Kanri Retail Practice at Seven-Eleven Japan continually evaluates its systems through the
designed controls. This monitoring of the performance is continual and ongoing. This is largely done
through observation and informal discussions. Feedback to employees and overall department heads is
informally given regularly as and when is required. Formal evaluation of performance is also conducted
semiannually – or quarterly, depending on the need and the urgency of the projects and assigned tasks.
This is a formal process that is undertaken by supervisors and managers to ensure the identification of
performance lags, and suggestive means of improvement.

1.3.4. Internal processes for organizational alignment

Tanpin Kanri Retail Practice at Seven-Eleven Japan also has special processes and methods for ensuring
that all departments and systems within the organization are aligned and working in harmony towards
the greater business goals and targets. This is made possible through ensuring that all systems are
designing and working towards goals and targets specific to their expertise under the broader business
vision and strategy. Moreover, the strategic leadership at Tanpin Kanri Retail Practice at Seven-Eleven
Japan also ensures that all systems are allocated with resources, and set specific targets to achieve
similar business goals in any specific period.

2. Soft elements

The soft elements of the McKinsey 7s model, in turn, include shared values, staff, skills, and strategy.
These elements are less tangible in nature and are more influenced by the organizational culture. As
such, the management does not have direct influence or control over them. These elements are also
harder to describe and directly identify – but are equally important for an organization’s success and
improved performance.

2.1. Shared values

2.1.1. Core values

The core values at Tanpin Kanri Retail Practice at Seven-Eleven Japan are defined and communicated to
foster a creative and supportive organizational structure that will allow employees to perform optimally,
and enhance their motivation and organizational commitment. The core values at Tanpin Kanri Retail
Practice at Seven-Eleven Japan include, but are not limited to:

- Creativity

- Honesty

- Transparency

- Accountability
- Trust

- Quality

- Heritage

The Tanpin Kanri Retail Practice at Seven-Eleven Japan business also ensures that all its activities and
operations are conducted with high ethical and moral standards that redefined and benchmarked
against international criteria.

2.1.2. Corporate culture

Tanpin Kanri Retail Practice at Seven-Eleven Japan encourages an inclusive culture that celebrates
diversity. The company has an international presence, and production units that are spread across
different countries, as such, Tanpin Kanri Retail Practice at Seven-Eleven Japan ensure that its
organizational culture is supportive of diversity, and has internal policies to reduce incidences of
discrimination.

The corporate culture at Tanpin Kanri Retail Practice at Seven-Eleven Japan also encourages innovation
and creativity by allowing independence for growth to individuals and teams –thus helping them refine
their careers as well as personalities. Lastly, the corporate culture at Tanpin Kanri Retail Practice at
Seven-Eleven Japan also has a supportive leadership which works towards increasing employee
motivation and job satisfaction by giving way to visibility and accessibility.

2.1.3. Task alignment with values

Tanpin Kanri Retail Practice at Seven-Eleven Japan ensures that all its job tasks and roles are aligned with
the core values that the company propagates. This means that all activities, tactics, and strategic tactics
employed by Tanpin Kanri Retail Practice at Seven-Eleven Japan will reflect its core values, and will not
deviate away from these. This is to ensure a consistent, and reliable brand image, as well as an honest
organizational culture. In the event of organizational change, the company will continue to ensure that
all change management processes and methods incorporate the core values so that the organizational
culture is consistently maintained, and systematically changed if need be.

2.2. Style

2.2.1. Management/leadership style

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a participative leadership style. Through a
participative leadership style, Tanpin Kanri Retail Practice at Seven-Eleven Japan is able to engage and
involve its employees in decision-making processes and managerial decisions. This also allows the
leadership to regularly interact with the employees and different managerial groups to identify any
potential conflicts for resolution, as well as for feedback regarding strategic tactics and operations.
Through its participative leadership, Tanpin Kanri Retail Practice at Seven-Eleven Japan is able to
enhance employee motivation, and increase organizational commitment and ownership amongst
employees as well as other stakeholders.

2.2.2. Effectiveness of leadership style

The participative leadership style is highly effective in achieving the business goals and vision of the
organization. Employees feel to be active members of the organization who are valued for their
suggestions, feedback, and input. Moreover, through participative leadership, leaders and managers are
able to identify current and potential conflicts within the Tanpin Kanri Retail Practice at Seven-Eleven
Japan organization, and actively work to resolve them as soon as possible.

2.2.3. Cooperation vs competition – internally

With its supportive and encouraging organizational culture, Tanpin Kanri Retail Practice at Seven-Eleven
Japan gives way to internal collaboration and cooperation between employees, systems, teams, and
departments. This cooperation and collaboration at Tanpin Kanri Retail Practice at Seven-Eleven Japan is
important since its operations are spread globally, and also because tasks and responsibilities within the
company often require inter-departmental feedback and input. Moreover, with increased expansion,
and synergy, the business also regularly forms project teams – which function effectively because of the
cooperative and collaborative culture within the Tanpin Kanri Retail Practice at Seven-Eleven Japan
organization.

2.2.4. Team vs groups

Tanpin Kanri Retail Practice at Seven-Eleven Japan has effective and functional teams and works with
them internally to achieve its various business goals and objectives, and complete tasks. The company’s
management is encouraging and supportive, and the leadership provides a motivating and pragmatic
vision toad achieve. The human resource management system, as well as the organizational training,
supports all employees in their growth fairly and transparently. This leads to effective team formation
instead of nominal groups within the organization for various projects, as well as department-specific
tasks and roles.

2.3. Staff

2.3.1. Employee skill level vs business goals

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a sufficient number of employees employed
across its global operations. Employees for different job roles and positions are hired internally as well
as externally – depending on the urgency and the skill levels required. Based on this, it is seen that
Tanpin Kanri Retail Practice at Seven-Eleven Japan has employees who are skilled as per the
requirements of their job roles and positions. All employees are given in house training to familiarize
themselves with the company and its values. External training along with in-house training is provided
for skill level enhancement.

All job roles and positions are designed to facilitate the achievement of business goals, and as such,
employee skill level at Tanpin Kanri Retail Practice at Seven-Eleven Japan is sufficient to achieve the
business goals of the company.

2.3.2. Number of employees

Tanpin Kanri Retail Practice at Seven-Eleven Japan has employed a large number of employees. The
number of employees varies from country to country as per the requirements and needs of the business
and operations. The global team of Tanpin Kanri Retail Practice at Seven-Eleven Japan is an inclusive one
that accepts, and encourages diversity, and works in synchronization with members to ensure
attainment of business goals. The team member sand employees are the most important part of
business success for Tanpin Kanri Retail Practice at Seven-Eleven Japan.

2.3.3. Gaps in required capabilities and capacities

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a well-defined system for identifying potential
needs of capabilities and capacities for the organization. The human resource function of the business
has a systematic process that aligns all other departments to identify potential vacancies or skill gaps.
Based on the nature of the need, the human resource department arranges for recruitments which may
be permanent or contractual in nature, as well as arranges training sessions if need be for the current
workforce.

2.4. Skills

2.4.1. Employee skills

Tanpin Kanri Retail Practice at Seven-Eleven Japan has a commendable workforce, with high skills and
capacities. All employees are recruited based on their merit and qualifications. Tanpin Kanri Retail
Practice at Seven-Eleven Japan prides itself on hiring the best professionals and grooming them further
to facilitate growth and development.

2.4.2. Employee skills vs task requirements

Tanpin Kanri Retail Practice at Seven-Eleven Japan has defined tasks and job roles and hires and trains
employees for skill levels accordingly with respect to those. The company ensures that all its job
requirements are met and that employees have the sufficient skills to perform their respective jobs in
accordance with the values and culture as well as the business goals and strategy of Tanpin Kanri Retail
Practice at Seven-Eleven Japan.

2.4.3. Skill management

Tanpin Kanri Retail Practice at Seven-Eleven Japan pays particular attention to enhancing the skills and
capacities of its employees. It arranges regular training and workshops – internally as well as externally
managed- to provide growth and development opportunities for its employees. Tanpin Kanri Retail
Practice at Seven-Eleven Japan focuses on personal as well as professional growth for its employees and
works accordingly with them.

2.4.4. Company’s competitive advantage

The human resource is one of the core competitive advantages of the company. The skills of employees
are developed specifically for job roles and requirements at Tanpin Kanri Retail Practice at Seven-Eleven
Japan and provide a competitive benefit to the company – where players cannot imitate employee skills
or training. This creates a unique and non-substitutable competency for Tanpin Kanri Retail Practice at
Seven-Eleven Japan.

7/11 Franchising

How does it work?

Since our first partner franchisee in 1998, the 7-Eleven Franchise business model has proven its success
time and again. Our unique system supports the co-existence and co-prosperity between PSC and the
franchise Operator featuring a back-end system which includes support for product development, store
maintenance, and bookkeeping services; the franchisee can focus more on store operations and sales
building activities for the store.

Currently, there are over 3843 stores franchised representing almost 70% the network nationwide.
Being the lion’s share, 7-eleven remains focused on helping franchisees grow their business. PSC
provides operational tools and support facilities to the franchisees need to deliver quality products and
services to customers.

What we Offer

 Gross Profit Split

We share on the profits you make. Most franchisors take royalties on sales, but 7-Eleven share profits
with our partner-franchisees. Our system has designed tools and resources to help you increase gross
profits while reducing losses and bad merchandise.

 We got you covered

When you franchise a 7-Eleven, you become part of brand that is loved nationwide, with over XXXX
stores from Ilocos to Davao. With our rapid expansion, there is bound to be a franchise available or a
new store in your community.

 Turnkey

7-Eleven provides the equipment and a host of services that will aid you in selecting your location,
constructing your store, operations sales and management training, and even store accounting.

 Start up in less than a year

The franchise process takes around 4-6 months; inclusive of a series of Interviews, Classroom and In-
store Training and Construction.

More 7-Eleven’s Support System Offers

Training Program
 Training Program - We will provide you with a comprehensive franchise training program for
four weeks
 Bookkeeping assistance - Bookkeeping system that provides daily and monthly reports and
store audits
 Property and equipment - Conduct periodic equipment maintenance or replacement (as
necessary)
 Counseling Services - Weekly Meetings with your Field Consultant
 Promotional Activities - All stores enjoy monthly thematic promotions; Availability of POP
materials and other in-store collaterals
Franchise Process
Step 1: Initial contact - Complete the online inquiry form to schedule a franchise briefing every
Mondays and Thursdays at 10 AM or 2 PM at 7/F Columbia Tower, Ortigas Avenue, Mandaluyong City

Step 2: Pre-qualification - Select your site from our list or if you already have a location, 7-Eleven will
help you evaluate your site. After selecting your location, kindly let us know the ability of your store.

Step 3: Interview with the approval committee - A three-level interview for our future franchisees. Let
us know you more!

Step 4: Memorandum of agreement signing - After passing series of interviews, legal documents will be
prepared for you to study before you sign, ensuring your full understanding of 7-Eleven franchise.

Step 5: Training - Prepare for your one-month training and get to know 7-Eleven operations.

Step 6: Store opening and turn over - In a span of four to six months, you can now operate your own 7-
Eleven convenience store.