McKinsey 3 Horizons of Growth (PowerPoint PPTX Slide Deck)

DESCRIPTION

This product (McKinsey 3 Horizons of Growth) is a 31-slide PPT PowerPoint presentation slide deck (PPTX), which you can download immediately upon purchase.

Organizations undergo different phases of development. Some reach maturity and then decline over time, whereas others just fade away in the startup phase.

A few organizations, however, evade collapse and maintain Growth for years. They accomplish this by allocating dedicated resources, investment, time, and effort into the creation of unique concepts, testing and nurturing those, and ousting defunct products.

This PowerPoint presentation provides a detailed overview of McKinsey 3 Horizons (3H) of Growth model. This strategic framework outlines 3 different horizons (Innovation categories) that should run in parallel for an organization to be successful.

The 3 horizons of Growth include:

Horizon 1 – Defend and extend core businesses
Horizon 2 – Build emerging businesses
Horizon 3 – Create viable options

Organizations must invest in each of these horizons and tackle the specific challenges that accompany them to achieve sustainable long-term Growth. Each horizon is explained in detail in this presentation.

Successful implementation of the McKinsey 3 Horizon model requires a holistic approach. It involves a combination of Strategic Planning, Cultural Transformation, and robust management practices to ensure that an organization effectively balances its Innovation and Growth efforts across the 3 horizons. This deck explains 3-step process to McKinsey 3 Horizons implementation:

1. Develop understanding of the core business.
2. Analyze the environment.
3. Develop and execute plans to create disruptive Value Propositions.

The 3H framework directs the attention of an organization on bolstering its existing portfolio as well as developing future revenue streams and business opportunities. Note that the 3 Horizons framework is not a solution for every situation. Its implementation depends on the organization's industry, objectives, and capabilities.

This PowerPoint presentation on McKinsey 3 Horizons of Growth also includes some slide templates for you to use in your own business presentations.

This presentation not only outlines the McKinsey 3 Horizons of Growth model, but also provides actionable insights on how to effectively implement it within your organization. With practical templates included, you can seamlessly integrate these strategies into your own business practices, ensuring a structured approach to driving innovation and sustainable growth.

Source: Best Practices in Innovation, Growth Strategy PowerPoint Slides: McKinsey 3 Horizons of Growth PowerPoint (PPTX) Presentation Slide Deck, LearnPPT Consulting

PPT SLIDE DEEP DIVES

Strategic Framework for Sustainable Business Growth

This PPT slide presents the McKinsey 3 Horizons of Growth framework, which is designed to help organizations navigate market disruptions and identify growth opportunities. It emphasizes the importance of balancing existing core business operations with the pursuit of new ventures.

Horizon 1 focuses on assessing current resources, ensuring that the core business is well-managed and optimized for immediate profitability. This stage is critical for maintaining stability and sustaining revenue streams.

Horizon 2 shifts the focus toward strategic planning, where businesses begin to explore and develop emerging opportunities. This involves identifying potential areas for growth that can be cultivated over time, requiring a more forward-looking approach.

Horizon 3 is about tactical decision-making, where organizations must actively transition from their current state to future growth avenues. This horizon encourages innovation and the creation of viable options that can lead to new business models or products.

The accompanying graphic illustrates the relationship between profit and time across these horizons, highlighting how each requires distinct management strategies. The right-hand side of the slide outlines specific actions associated with each horizon: extending and defending core businesses in Horizon 1, building emerging businesses in Horizon 2, and creating viable options in Horizon 3.

This framework serves as a guide for leaders to prioritize initiatives that align with their long-term vision while ensuring that immediate operational needs are met. Understanding and applying this model can lead to more structured growth strategies and better resource allocation.

Implementing the McKinsey 3 Horizons Framework

This PPT slide presents an overview of the McKinsey 3 Horizons framework, emphasizing its significance in guiding strategic planning for businesses. It highlights the necessity of a holistic approach to effectively implement this model. The framework is designed to balance innovation and growth across 3 distinct horizons, which are crucial for long-term success.

Three critical steps are outlined for successful implementation. The first step involves developing a deep understanding of the core business. This foundational knowledge is essential for identifying strengths and weaknesses, which can inform strategic decisions. The second step focuses on analyzing the environment, suggesting that organizations must assess external factors and market dynamics that could impact their operations. This analysis is vital for recognizing opportunities and potential threats.

The third step is about developing and executing plans aimed at creating disruptive value propositions. This indicates a proactive approach to innovation, where organizations are encouraged to think beyond traditional offerings and explore new avenues for growth.

The slide also notes that the 3 Horizons framework is not universally applicable. Its effectiveness hinges on the specific context of the organization, including its industry, objectives, and capabilities. This caveat serves as a reminder that while the framework provides valuable guidance, customization is necessary to align it with unique organizational needs. Overall, the slide encapsulates a structured approach to strategic planning, emphasizing the interplay between understanding the core business, environmental analysis, and innovative execution.

Strategic Framework for Long-Term Business Development

This PPT slide outlines the concept of the third horizon of growth, which focuses on long-term strategic initiatives aimed at developing new businesses and revenue streams over a period of 5 to 12 years. It emphasizes the importance of generating innovative ideas and exploring new markets. The content suggests that organizations should prioritize piloting new initiatives and nurturing opportunities, which involves allocating discretionary spending towards ventures that may yield significant returns in the future.

Key elements highlighted include the need for investments in areas such as product development, mergers, and advanced technologies like automation and artificial intelligence. This indicates a forward-thinking approach, where companies are encouraged to take calculated risks to stay ahead in a rapidly evolving market. The slide also identifies the measurement metric as the potential value of these ideas or viable options, underscoring the necessity for a robust evaluation framework.

The responsible parties for these initiatives are described as visionaries, suggesting that leadership must be proactive and innovative in their thinking. The capabilities required are noted as indeterminate, which implies a need for flexibility and adaptability in skills and resources. This uncertainty can be a challenge,, but it also opens the door for creative problem-solving and strategic partnerships.

Overall, the slide serves as a call to action for executives to embrace a long-term perspective in their strategic planning, ensuring that they are not only reacting to current market conditions, but also preparing for future opportunities that can drive sustainable growth.

Optimizing Core Business for Short-Term Growth

This PPT slide outlines the first horizon of growth, emphasizing the importance of maintaining and enhancing core business operations. This horizon focuses on short-term growth, typically within a 1-3 year timeframe, and is centered around sustaining existing value propositions that generate cash flow. The key message is about optimizing margins and profits through improved business processes and performance enhancements.

Leadership plays a critical role in this phase. It's essential for executives to assess the organization’s strengths and weaknesses. This evaluation will help identify which value propositions are effective and which may need to be retired or abandoned. The slide suggests that activities in this horizon are often routine, involving sales, marketing, and customer acquisition efforts. These tasks are fundamental to ensuring the ongoing success and growth of core businesses.

The measurement metric highlighted is the Return on Invested Capital (RoIC), which serves as a crucial indicator of financial performance in this horizon. The responsible individuals for these initiatives are referred to as business maintainers, indicating a focus on those who manage and optimize existing operations. Furthermore, the slide notes that a fully-assembled capability platform is necessary to support these activities effectively.

Overall, this slide serves as a strategic reminder of the foundational work required to defend and extend core business operations. It stresses the need for a disciplined approach to managing existing resources while also being vigilant about potential areas for improvement. This perspective is vital for any organization looking to secure its immediate future while laying the groundwork for longer-term growth.