Three Horizons

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From chapter 17 in the book:

The three horizons was a model put forward in the Alchemy of Growth[1], 1999. It discussed three views that any corporation had to take.[2]

Horizon 1 : the core business which provides the greatest profits and cash flows that need to be extended and defended.

Horizon 2 : are the emerging opportunities and businesses that will drive medium term growth. These may include new ventures that you are investing in which are expected to generate substantial future profits.

Horizon 3 : These are ventures that should ensure the company long term future. They can include research projects or pilot programs or even investment in startups.

Whilst this model of three horizons is a reasonable way of examining a company, I personally find it inadequate. I often find that some confuse it with the  pioneer - settler - town planner model of organisation by associating town planners with horizon one and pioneers with horizon three.[3]

See Also

Mckinsey Quarterly: Enduring Ideas - The Three Horizons of Growth

Fast Time in Three Horizon High