methodatlas
Business Strategy

Three Horizons

Structures current business, emerging growth fields, and future options across three horizons so portfolio decisions can balance today, tomorrow, and later.

Core question
How is the current initiative portfolio distributed across the three horizons, which imbalances become visible, and which reallocation secures both today and tomorrow?
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Purpose

Three Horizons helps clarify strategic options across different timeframes. It compares strengths, risks, market logic, and investment choices, and captures the result as a horizon map, portfolio view, and initiatives per horizon.

How it works

The team describes the current business as Horizon 1, identifies growth fields as Horizon 2, names disruptive or long-term topics as Horizon 3, sets suitable resources and metrics for each horizon, plans transitions between horizons, and reviews the portfolio regularly.

Visual orientation

Method sketch for a quick mental model.

Three Horizons · Balance Present, Transition, and FutureMake H1, H2, and H3 visible as a portfolio of different time horizons, expectations, and investment logics
H1 Heute -> H2 Übergang -> H3 ZukunftAktuelles Geschäft, Übergangsinnovationen und Zukunftsoptionen werden gleichzeitig balanciert.H1 Heute bis Portfolio-LogikAktuelles Geschäft, Übergangsinnovationen und Zukunftsoptionen werden gleichzeitig balanciert.verteidigentransformierenerkundenH1 HeuteKern stabilisierenH2 Übergangneue Modelle skalierenH3 Zukunftradikale Optionen erkundenPortfolio-LogikRessourcen, Metriken und Erwartungen je Horizont trennen

Flow

  1. 1Describe the current business as Horizon 1
  2. 2Identify growth fields as Horizon 2
  3. 3Name disruptive or future topics as Horizon 3
  4. 4Set resources and metrics per horizon
  5. 5Plan transitions between horizons
  6. 6Review the portfolio regularly

The runsheet guides execution with 5 phases, timeboxes, 6 pitfalls, and clear stop criteria.

Open runsheet

Ideal for

  • Strategy and innovation portfolios
  • Executive alignment
  • Medium- and long-term planning
  • Innovation reviews

Not good for

  • Detailed sprint planning
  • Pure backlog prioritization
  • Pure compliance topics

Deep dive

In detail

The Three Horizons model was popularized by McKinsey in The Alchemy of Growth. Horizon 1 covers the core business that creates today's cash flow and must be optimized and protected. Horizon 2 contains growth areas that are promising but not yet fully scaled. Horizon 3 includes early options, research, and disruptive ideas with a longer maturation path. Each horizon needs its own metrics, resources, and expectations so one horizon does not crowd out the others.

Facilitation

Bring operations, strategy, and innovation perspectives into the room so all horizons are represented. Visualize the portfolio clearly and define a review rhythm, for example quarterly.

Output artifacts
Horizon mapPortfolio viewInitiatives per horizonResource plan
Tags
strategyhorizonsinnovationportfolioforesight

Sources

Three Horizons Model | Board of Innovationboardofinnovation.comThree Horizons | Wikipediaen.wikipedia.org
Artifact templates
Three Horizons Working TemplateCompact working template for Three Horizons with context, input, output artifacts, and next step.
canvas

three-horizons-working-template.md

Compact working template for Three Horizons with context, input, output artifacts, and next step.

Three Horizons Canvas

Context

What is this method used for?

Core question

Which question should be answered at the end?

Input

Which data, observations, or materials are available?

Working area

  • Area 1:
  • Area 2:
  • Area 3:
  • Relationships / patterns:

Output artifacts

  • Horizon map:
  • Portfolio view:
  • Initiatives by horizon:
  • Resource plan:

Open questions

  • ...

Next step

Owner, date, success signal.

When to choose differently

Short decision aid for existing alternatives.

Balanced Scorecard

Statt Three Horizons, wenn du mit Balanced Scorecard Strategie über mehrere Perspektiven mit Kennzahlen und Steuerung abbilden willst.

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