How The Three Horizons Help Your Business

When it comes to innovation, at hgkc, we use the Three Horizons of Growth model with our clients. This is a concept developed by McKinsey that helps businesses focus their attentions between running their business today and innovating for the future. The framework helps you focus on your innovation and growth helping you to concentrate on executing already existing business processes whilst continuing to develop new capabilities for the future of your company.

It is a strategy framework that categorises your innovation projects into three different ‘horizons’:


Horizon 1: Maintain and Defend Your Core Business

All processes that are aligned to your current business model and your current revenue making practices fit into this horizon. This includes your day-to-day activities that help you work towards your existing business goals.

The activities included in Horizon 1 will revolve mostly around improving existing processes and keep bringing money in, continuously innovating in line with your current practices and capabilities in the short term.

To apply Horizon 1 to your business you need to have a deep understanding of your core processes.


Horizon 2: Nurture Emerging Business

Horizon 2 focuses on taking what processes you have and developing and expanding them into new areas that will continue to drive profit, including launching new products and moving into new markets. It should be just as reliable as your current business model as you are extending what you already have. This horizon can also include moving into new geographical locations and finding a new customer base.

Horizon 2 bridges the gap between Horizons 1 and 3.


Horizon 3: Create Genuinely New Business

Horizon 3 focuses on introducing new elements to your business that do not currently exist. It focuses on blue-sky thinking aimed at disrupting your company’s business model and the sector in which you are operating.

Horizon 3 is important for understanding areas in which your company could succeed without using any of the things that you use today. It can also be about radical diversification and using your research to explore completely new lines of revenue.


McKinsey’s Three Horizons of Growth helps you organise the projects that will help you run your business more profitably today, and those you need to develop and implement to grow it for the future.


To understand more about how hgkc use McKinsey’s Three Horizons to help your business get in touch today and for more information on the importance of innovation, read our Innovation page.

Categorised: Innovation

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