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.
Business Strategy Planning tool
Three Horizons
Balances core business, emerging growth engines, and long-term options across three horizons.
Horizon 1 strengthens today's business, Horizon 2 scales emerging businesses, and Horizon 3 explores options. Horizons are maturity and uncertainty logics, not rigid year boxes.
How do we allocate attention and resources across current performance, emerging growth, and future options?
- Participants
- 3-12
- Time
- Halbtags-Workshop, dann iterativ
Three Horizons uses portfolio across H1 core, H2 emerging businesses, and H3 options. Assessments remain justified and context-bound.
Map portfolio
Map portfolio
Capture initiatives with purpose, maturity, and uncertainty.
Assign horizons
Assign horizons
Assign H1, H2, or H3 by business logic.
Set metrics
Set metrics
Set appropriate performance, scaling, or learning metrics per horizon.
Allocate
Allocate
Decide budget, talent, and transition criteria.
Update after new evidence or a material context change and retain the previous version.
A good fit when
For portfolio and resource decisions involving initiatives at different maturity levels.
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
Outputs
three horizons portfolio
three horizons portfolio with traceable sources, assumptions, and domain decisions.
Decision and review trail
Owners, dates, and next review for three horizons portfolio.
three horizons portfolio
Fictional worked example
portfolio across H1 core, H2 emerging businesses, and H3 options as a precise working structure with a fictional example.
Initiative/maturity
Initiative/maturity information to record
AI Review Assistant, frühe Option.
Horizon/rationale
Horizon/rationale information to record
H3 wegen hoher Technik- und Value-Unsicherheit.
Metric/learning goal
Metric/learning goal information to record
Sichere Zitation in fünf Workflows.
Resource/transition
Resource/transition information to record
40 T€ Optionsbudget; H2-Gate definiert.
The example demonstrates the domain logic of Three Horizons; worksheets remain blank.
First step
Start with the core question: How do we allocate attention and resources across current performance, emerging growth, and future options?
Deep dive
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.
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.
The method guide walks execution through 4 phases, timing, 4 pitfalls, and clear stop criteria.
Open method guideYour perspective
Does this method help with your work?
Your feedback helps shape the next improvements to methodatlas.
Sources and topics
Artifact templates
Three Horizons: WorksheetPlan Three Horizons around its domain steps and the concrete decision question.markdown
Three Horizons: WorksheetPlan Three Horizons around its domain steps and the concrete decision question.
markdownthree-horizons-working-template.md
Plan Three Horizons around its domain steps and the concrete decision question.
Three Horizons: Worksheet
Question
To be confirmed
Desired outcome
To be confirmed
Scope
Full initiative Time: 2–3 hours; quarterly review
Complete this worksheet on paper or in your own document during the work.
Preparation for this scope
Method setup
- Materials: Strategy and financial goals, initiative portfolio, evidence, maturity, and resources, shared workspace, source links, and decision log.
- Roles: Executive sponsor · Strategy · Finance · portfolio/business owners
- Advance information: Collect Strategy and financial goals, initiative portfolio, evidence, maturity, and resources in advance and mark open assumptions.
- Overall time needed: 2–3 hours; quarterly review
- Setup: Prepare portfolio across H1 core, H2 emerging businesses, and H3 options visibly and calibrate assessment terms before starting.
Prepare for the work steps
Map portfolio: Map portfolio
- Strategy and financial goals
- initiative portfolio
- evidence, maturity, and resources
Assign horizons: Assign horizons
- portfolio inventory
- initiative portfolio
- evidence, maturity, and resources
Set metrics: Set metrics
- horizon map
- initiative portfolio
- evidence, maturity, and resources
Allocate: Allocate
- metric contract
- initiative portfolio
- evidence, maturity, and resources
three horizons portfolio
Initiative/maturity
Initiative/maturity information to record
...
Horizon/rationale
Horizon/rationale information to record
...
Metric/learning goal
Metric/learning goal information to record
...
Resource/transition
Resource/transition information to record
...
Enter only real input, sources, and decisions.
McKinsey: Enduring Ideas, The three horizons of growth
Map portfolio: Map portfolio
Expected artifact: portfolio inventory
portfolio inventory · source · uncertainty · next decision
Entry:
...
- Is every initiative described for decision?
Assign horizons: Assign horizons
Expected artifact: horizon map
horizon map · source · uncertainty · next decision
Entry:
...
- Is classification more than time horizon?
Set metrics: Set metrics
Expected artifact: metric contract
metric contract · source · uncertainty · next decision
Entry:
...
- Does the metric fit uncertainty?
Allocate: Allocate
Expected artifact: portfolio decision
portfolio decision · source · uncertainty · next decision
Entry:
...
- Are trade-offs and exit rules explicit?
Open questions and next steps
...
Method guide: https://methodatlas.meierhoff-systems.de/en/methods/three-horizons/run-sheet
Alternatives and neighbors
Fitting alternatives with decision guidance, followed by other related methods.
Business Strategy
Balanced Scorecard
Instead of Three Horizons, choose Balanced Scorecard when you want to map strategy across several perspectives with metrics and steering.
Business Strategy
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Ansoff Matrix
Clarifies starting point, opportunities, and strategic options by defining products and markets, collecting growth options, and choosing focus options.
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Strategy Map
Visualizes strategic objectives and cause-and-effect relationships so a leadership team sees the same strategy story.
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GAP Analysis
Compares target and actual state, exposes gaps, and derives prioritized measures with clear risks.
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Porter Five Forces
Clarifies starting point, opportunities, and strategic options by defining the industry scope, analyzing the five forces, and formulating strategic options.
Constraints and origin
MediumWorkshopHalbtags-Workshop, dann iterativ
Profile
- Method form
- Planning tool
- Participants
- 3-12
- Time
- Halbtags-Workshop, dann iterativ
- Maturity
- Established
- Origin
- Bill Sharpe and International Futures Forum
Next up: OKRs