Innovation Strategy: The Three Horizons of Growth (McKinsey)

 
Disruptive Innovation > Best Practices > Innovation Strategy: The Three Horizons of Growth (McKinsey)

Innovation Strategy: The Three Horizons of Growth (McKinsey)
Charles Alter, Consultant, United States, Member
One of ways of thinking about innovation strategy is to use the 3 Horizons of Growth developed by Steve Coley at McKinsey.
The framework provides a useful mold to formulate an organization’s product and service portfolio strategy. It's a diagnostic tool that allows for evaluating the health of a product/service strategy pipeline and for setting up the alignment of short, medium, and long term (innovation) plans of an organization. The model describes 3 innovation horizons in the following manner:
The Three Horizons of Growth model...- Horizon #1: The Core Business that is most associated with the company in its current state. This typically is an established business that requires most of the attention of the company’s employees and generates the bulk of the sales volume, cash flow a...Sign up 		 

 
Three Horizons Concept
Jeff Miles, Business Consultant, Australia, Member
Great thought prompter. I will use this at my next client meeting as an ice breaker and see what they come up with.
Thanks Charles....Sign up
 

 
New Ventures have only Horizon 3
Edith Ohri
Why starting with a core business when in new ventures many times the business is in the future, i.e. horizon 3 without passing the first 2 suggested ...Sign up
 

 
3 Horizons of Growth
Jorge Urrea, Consultant, Mexico, Member
I agree with Edith Ohri and, as usually, the article only presents the "what" to do and not the "how" to do....Sign up
 

 
Three Horizons: Why?
Vincenzo Rogione, Management Consultant, Italy, Member
Though I appreciate Charles' comment, in my opinion the framework appears conceptually obvious and does not provides much practical conclusions...Sign up
 

 
Extensions for the 3 Horizons of Growth
Anna hanooman, ICT Consultant, Trinidad and Tobago, Member
I agree with Ohri. In my humble opinion, the three horizons listed are not necessarily engines of innovation or growth since it seems to be based on t...Sign up
 

 
Three Horizons of Growth is in Practice for Ages
M Y Zainudeen, Management Consultant, Sri Lanka, Member
Edith is correct, not only this model is in the school books, it has been practiced in the real world for centuries. There are many business entities ...Sign up
 

 
Three Horizons of Growth Relevant for Established Businesses
Charles Alter, Consultant, United States, Member
@Edith Ohri: admittedly, the three horizons are meant for existing, established businesses with a reasonably stro...Sign up
 

 
How to Implement the 3 Horizons within 1 Company
simon haafs, Student (MBA), Netherlands, Member
I underscribe the model. The challenge is to integrate the the three horizons within one company, essential for succes. It needs though differe...Sign up
 

 
3 Horizons : Sources for Ideas for Innovation
Gary Stead, Director, United Kingdom, Member
It seems the real innovation is in horizon 3. The open question is "Where to hunt for the ideas to put into the mixer". Procurement leaders will tell ...Sign up
 

 
Combine the Three Horizons of Growth with the 5 C's of Marketing Strategy
Rajan Johri, India, Member
You can augment the 3 horizons with the 5 C's of Marketing Strategy to be grounded into applica...Sign up
 

 
Balancing Product's Innovations and Future Products
MdL Mario TERRALAVORO, Interim Manager, Italy, Member
The 3 Horizons combine looking at future products developments and new trends of the market and new consumer's trend with improve the current products...Sign up
 

 
Three Horizons of Growth Understandable and Useful Across Sectors / Industries
KATHRYN STEINER, MBA, Entrepreneur, United States, Member
@Charles Alter: hello Charles, you have explained these critical elements so that I can apply them to my experience ...Sign up
 

 
3 Preparation Stages for Horizons of Growth
Feraidoon Bakhtiari, CxO / Board, Iran, Member
I like the idea and I share the concepts with participants in my workshops. But prior to that you need to scan the environment in order to iden...Sign up
 

 
Status Quo to Boost Future Plans
Saeed Khodaee, Director, Iran, Member
@Edith Ohri: undoubtedly, without maintaining the status quo, it might be jeopardizing to jump to step three. Any st...Sign up
 

 
The Three Horizons and Competitiveness
SAMUEL NDUATI MBUGUA, Management Consultant, Kenya, Member
Whereas the main objective of the three horizons is the development of an innovation strategy, its emphasis is on the development of the competitive s...Sign up
 

 
3 Horizons of Growth is Still Valuable as a Foundation
marc romano, Strategy Consultant, United States, Member
This basic framework is very sound. It provides a solid platform for expansion and application depending on the market environment, industry dynamics ...Sign up
 

 
Three Horizons of Growth
Leodegardo M. Pruna, Professor, Philippines, Member
The first horizon to my mind is where an enterprise should maintain both a comparative and competitive advantage. The second horizon is where an enter...Sign up
 

 
Three Horizons of Growth are Practical
Sorni Tindanzo Namateng, Student (University), Ghana, Member
Thank you Charles, today is my first time at 12manage and its obvious I've been missing a lot. This three horizons of growth model sounds rather pract...Sign up
 

 
Where to Hunt for Innovation Ideas?
Tadeusz Sudol, Strategy Consultant, Poland, Member
@Gary Stead: The answer is: everywhere, but the process of innovation development has to be structured. See: Roberto...Sign up
 

 
The Right Distribution of Resources over the 3 Horizons
Raghu Bala, Manager, United States, Member
Businesses struggle with distributing resources to make strides on all three horizons. Resources that are capable of contributing to horizon #3 are al...Sign up
 

 
Exploring Uncertainity with the 3 Horizons of Growth
Osama Kamal, Management Consultant, Egypt, Member
It's like these 3 horizons. I will use the model in my own career. In Egypt businesses nowadays have high uncertainity and this may last for a while. ...Sign up
 

 
Innovation Strategy: the Three Horizons of Growth (McKinsey)
SAMARENDRA KUMAR MOHANTY, India, Member
@Edith Ohri: steps 1-2 are required to generate resources and provide backup in case of failure of step 3 which is m...Sign up
 

 
Three Horizon Concept for Challenging the Status Quo
Brijesh Dave, Manager, India, Member
Good concept to generate thoughts to challange the status quo, will talk about this my next meeting. Thanks Charles....Sign up
 

 
Look out of the Window and see 3 Horizons
Falk Heinrichsohn, Business Consultant, Portugal, Member
The three horizon approach may help with the problem of innovation of companies if management is involved too much in maintenance engineering. If they...Sign up
 

 
Time is Important Point
Dr zahra gheidar, Consultant, Iran, Member
Certainly, these frameworks are usual steps for establishing a company but, we should consider that innovation and entrepreneurship will not create an...Sign up
 

 
Three Horizons of Growth all about Innovation and Marketing
Charles Alter, Consultant, United States, Member
Thank you to everyone who has replied and shared their thoughts on this subject. One parting thought from Peter Drucker, who said there are only 2 cri...Sign up
 

 
Don't Focus too much on Horizon 1
Aladdien Mohamed, Manager, Saudi Arabia, Member
Actually I have a comment on stage 1. Organizations should not consider its current form as their main business nor keep defending its existence all t...Sign up
 

 
Senior Managers Should Focus on Horizons 2 and 3
Jaap de Jonge, Editor, Netherlands
That's right, the 3 horizons of growth are especially useful for top managers to remind them of the 3 levels of thinking about the future of their fir...Sign up
 

 
Where are the Resources..
Cristina Isenrath, Director, Argentina, Member
@Gary Stead: more looking inside ourselves... To find resources we need to have time to think, to care about ourselv...Sign up
 

 
Protect your Bread and Butter First
GAMANSON, Management Consultant, Sri Lanka, Member
Any business has to ensure first it survives in the short and middle terms and it is the core business that generates revenue for survival. Hence as t...Sign up
 

 
Consistent Context Using Horizons
Martin Kerr, Project Manager, Australia, Member
In our organisation the 3 horizons are standard dialogue. Whilst most people within our organisation see them as timelines rather than capabilities, ...Sign up
 

 
All 3 Horizons are Important, but...
Jaap de Jonge, Editor, Netherlands
@Gamanson: all 3 are (equally) important for any business, but but senior / top managers of large organizations shou...Sign up
 

 
The 3 Horizons of Growth Help to Decide on Innovation Resources
Sandy Findlay, Business Consultant, United Kingdom, Member
Excellent model for drawing attention on where resources should be focused. I sometimes struggle with getting clients to focus on these different hori...Sign up
 

 
3 Horizons of Growth... Only for Large Companies?
Francesco Cuoco, CEO, Italy, Member
Seems a correct approach for medium- large companies.
What about SMEs? Can the same approach give valuable results?...Sign up
 

 
3 Horizons of Growth Reminds and Helps us Prepares for Change
Julius Belleza, CEO, United States, Member
I agree with Gamanson and Aladdien Mohamed. For business survival, especially in current global economy, H1 and H2 a...Sign up
 

 
Three Horizons of Growth at SMEs
Charles Alter, Consultant, United States, Member
@Francesco Cuoco: For SMEs (small - medium size enterprises) the model works, but needs to be scaled to the situati...Sign up
 

 
Consider the Reasons for Growth in 3 Horizons
FUNSHO, Accountant, Nigeria, Member
Business growth cannot be limited to these 3 horizons. We need to critically consider the widening future in line with the business objective. As soon...Sign up
 

 
3 Horizons Model - A Good Start for the Strategic Planning Process...
Olawale Christopher Olamiju, Financial Consultant, Nigeria, Member
No doubt, this 3 horizons model is not cast in stone and it does not necessarily mean that all businesses must follow in that linear progression.
...Sign up
 

 
Time to Spend on Each Innovation Horizon
Leodegardo M. Pruna, Professor, Philippines, Member
@Zahra Gheidar: there is no fixed rule on how much time to spend in each horizon. What is necessary is for the enter...Sign up
 

 
Transversal Innovation
ENRIQUE CARLOS POZO, Project Manager, Spain, Member
I think the three horizons must be parallels, not serial. The graphic gives an idea of each stage beginning when the horizon before is finished.
...Sign up
 

 
Differentiating Critical Functions and Costs
KATHRYN STEINER, MBA, Entrepreneur, United States, Member
@Charles Alter: innovation is probably also known as research and development (R&D). This component of a business is...Sign up
 

 
Quite Useful Model for our Organisation
Htin Kyaw Myint, Manager, Myanmar, Member
In fact, it is quite a good model for our organization, which is currently declining slowly and could use a systematic view at these 3 horizons....Sign up
 

 
Model for Industries That Have Complex Logistics
KATHRYN STEINER, MBA, Entrepreneur, United States, Member
This model would be interesting to translates into businesses such as the food service industry, where logistics can be complex, and with fluctuations...Sign up
 

 
Length of Horizons is Vital
Dr zahra gheidar, Consultant, Iran, Member
Certainly measuring a precise, definite time and degree in each horizon is unreasonable, but it is so vital for companies that they understand the app...Sign up
 

 
3 Horizons Model is about Strategy Stages
John Moses, Manager, Nigeria, Member
Looking at the three horizons, it is all about different strategies deployed by organisations at different stages from inception to maturity:
- H...Sign up
 

 
The 3 Horizons for Growth
Francesco Cuoco, CEO, Italy, Member
I think that the model is quite generic. The real issue from my side is to understand: is the 3 Horizons Model fully applicable in a context of eco...Sign up
 

 
Stabilizing Current Business can be hard in case of Disruptive Innovations
Charles Alter, Consultant, United States, Member
@Francesco Cuoco: I think that's exactly the point of the three horizons model. Companies must first stabilize thei...Sign up
 

 
This is only a Theoretical Framework
jasmin, Student (University), Lebanon, Member
This framework helps you how to think but not how to do it! I still believe SWOT analysis is more useful....Sign up
 

 
Combine 3 Horizons of Growth with SWOT Analysis
Francesco Cuoco, CEO, Italy, Member
@Jasmin: I guess the two methodologies complement each other.
Use the 3 horizons as baseline, identify actions...Sign up
 

 
3 Horizons of Growth
Ionelia Iftimie, Director, Romania, Member
I think this proposal would be an interesting start for developing innovation by developing creativity at each stage of growth!
Also, I think it ...Sign up
 

   
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