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McKinsey Three Horizons
Balance investment across the core today, near growth, and long-range bets.
Goal
Avoid the "core trap" that kills successful firms by allocating capital and time across three time horizons.
Steps
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1
Bucket every initiative into: H1 (core today), H2 (emerging 1-3 yrs), H3 (bet for 3-7 yrs).
Expected Outcome
Immediate
The team finds H3 (future) gets 0-2% of resources — explaining future anxiety.
Evidence base
School: McKinsey Strategy / Innovation Portfolio
Founders: Mehrdad Baghai · Stephen Coley · David White (1999)
Published by the McKinsey trio in "The Alchemy of Growth" (1999). Adopted by Alphabet/Google as their "X Moonshot" structure and many Fortune 500 companies.
Keywords
Frequently asked questions
How long does "McKinsey Three Horizons" take?
This exercise takes about 50 minutes, practiced in a group in a Written reflection format.
When will I notice the effect of "McKinsey Three Horizons"?
The team finds H3 (future) gets 0-2% of resources — explaining future anxiety. In the short term: Within a quarter, a defined symbolic budget for H3 starts instead of "if time permits".
Is "McKinsey Three Horizons" evidence-based?
Yes — it draws on McKinsey Strategy / Innovation Portfolio (Mehrdad Baghai, Stephen Coley, David White (1999)). Published by the McKinsey trio in "The Alchemy of Growth" (1999). Adopted by Alphabet/Google as their "X Moonshot" structure and many Fortune 500 companies.
Is "McKinsey Three Horizons" suitable for beginners?
Its difficulty level is: Advanced. No external tools required — it can be practiced directly inside the app.
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