Three Horizons: navigating towards a better future together

In his work on Adaptive Leadership, Ronald Heifetz said that people do not resist change, they resist loss.

If you have ever led transformation, or lived through it, you will recognise that immediately. Resistance is rarely about what might improve. It is about what people fear they will lose. Some losses are tangible, such as roles, relationships, habits or working practices. Others are less visible, such as professional identity, shared values or beliefs about why the work matters.

The leadership challenge is not simply to articulate a compelling future. It is to help people navigate what must end along the way. How do we move towards something better while acknowledging what needs to be let go? How do we avoid clinging to the present or leaping naively into the future?

Three Horizons offers a practical way to hold that tension.

What is the Three Horizons framework?

Originally developed by Bill Sharpe at the International Futures Forum, Three Horizons is a simple framework for navigating complex change. It provides structure to conversations that might otherwise feel polarised or stuck.

At its simplest, it suggests that three patterns of activity are always present at the same time.

• Horizon One represents the dominant way we currently deliver value. It is today’s operating model. Much of it works, but some of it will not be fit for the future.
• Horizon Three represents a desired future state. A different model, mindset or way of working. The future must be viable, though we may not fully grasp what that means yet.
• Horizon Two bridges the two. It is the space of innovation, delivering improvements to keep the current system going while also creating the conditions for a different future.

Change is not linear. All three horizons are active simultaneously. The task is to understand how they interact.

Horizon One: the dominant system under pressure

Horizon One is where most time and energy is spent. It is how we deliver services, run teams and meet targets. Often, we begin a Three Horizons conversation here because Horizon One is under strain.

In healthcare, we see lengthening waiting times, rising patient complexity, workforce shortages and pressure against performance standards.

In other sectors, we see legacy business models challenged by digital disruption, hierarchical cultures struggling to adopt more agile ways of working and risk aversion slowing progress.

Yet critically, not everything in Horizon One is broken.

The leadership task is not to discard the present wholesale. It is to ask:

• What is under pressure?
• What in our current way of working is no longer fit for purpose?
• What must we retain because it carries enduring value?

If we defend Horizon One at all costs, we drift into managed decline. If we abandon it too quickly, we lose scale, infrastructure and hard-won capability.

The most difficult work in Horizon One is naming what needs to end. That is where loss lives. Too often, leaders rush past this and try to sell a better future instead. Yet avoiding the conversation about endings stores up problems later.

Horizon Three: a compelling picture of the future

Horizon Three invites a different set of questions.

• What does a better future look like?
• What will be different when we get there?
• What kind of culture, model or behaviours will define that future?

This is not abstract visioning. A clear Horizon Three can galvanise energy and provide direction. It invites people to step into the possibility of a viable future for themselves and the organisation.

Crucially, Horizon Three is not only out there in the distance. Elements of it already exist inside Horizon One. They show up in small teams experimenting with new approaches, in leaders modelling different behaviours, in early signs of a new culture emerging.

Part of the work is to identify and nurture those signals.

Vision without connection to the present becomes fantasy. Horizon Three needs the scale and capability of Horizon One, and it relies on Horizon Two to bridge the gap.

Horizon Two: the bridge of innovation

Horizon Two is the space of innovation. It connects a system under pressure with a more viable future.

Three Horizons reframes the innovation question from “how do we innovate?” to “what kind of innovation do we need?”.

In Horizon Two, innovation looks both ways. It responds to the needs of today while moving towards the needs of tomorrow.

Some innovation is sustaining. It improves efficiency, optimises performance and prevents collapse. We call this H2 minus innovation. It keeps the current system afloat without changing its fundamentals.

Other innovation is disruptive. It shifts the model and moves the organisation towards a different future. We call this H2 plus.

A simple illustration from technology helps here. Moving from a cassette Walkman to a Discman enabled Sony to improve quality and convenience, but the model was essentially the same. That is sustaining innovation, or H2 minus.

Moving to MP3 players, and later streaming, fundamentally changed how we consumed music. That is disruptive innovation, or H2 plus.

The harder question for Sony was not capability, but recognition. Parts of their successful Horizon One model were no longer fit for purpose. Hardware dominance and a product-first mindset had become legacy strengths. Without facing what needed to end, they struggled to lean into the shifting trends around music consumption. The result was that Sony never regained its leadership in digital portable music.

Three Horizons brings clarity about what kind of innovation is required and what it is for.

Why use Three Horizons?

Over time, we have found that organisations turn to Three Horizons for three main reasons.

1. To find direction

Many teams feel the pressure of today but lack a shared picture of tomorrow. The challenges they face are systemic and adaptive rather than technical.

Three Horizons aligns groups around a shared future, the realities of the present and the innovation required to move between them. It makes visible the tensions between time horizons and helps leaders work with them rather than against them.

2. To make better decisions

By clarifying what needs to end, what must be preserved and what should emerge, teams can make more deliberate choices. They move from firefighting to intentional transition.

The framework sharpens trade-offs. What do we stop, protect or invest in?

3. To shift leadership mindset

Our own mindsets are part of the system. Three Horizons invites leaders to examine their default orientation. Do we defend Horizon One? Rush to Horizon Three? Or stay busy in Horizon Two without changing the core?

It creates space for insight alongside strategy.

The leadership tasks within each horizon

Each horizon carries a distinct leadership task.

Horizon One: the manager

The manager’s role is to steward the present responsibly. That includes:

• Managing performance and sustaining innovation under pressure
• Identifying what needs to end and helping people face loss
• Preserving what must endure and aligning with the future direction

This is emotionally demanding work. Ending things is uncomfortable, and a common mistake we see is leaders avoiding this work entirely. They instead focus on vision or innovation and hope that will overcome resistance.

Yet failing to name what must end weakens the transition and stores up resistance for later.

Horizon Two: the innovator

The innovator is both disruptor and pragmatist. Innovation must look both ways.

Their task is to:

• Create conditions for innovation to flourish
• Support improvement within the current model
• Take calculated risks to bridge towards the future

Without Horizon Two, the future never becomes real. Building this capacity requires organisations to become more comfortable with risk and learning from failure.

Horizon Three: the visionary

The visionary articulates a compelling picture of what could be.

Their task is to:

• Tell a story about the future that others can buy into
• Identify where that future is already emerging
• Engage innovators while holding the vision lightly enough for collaboration

Leading from Horizon Three requires staying connected to the organisation that exists today.

Common failure patterns

Three Horizons also explains why change efforts fail.

Sometimes Horizon One captures all innovation. New ideas are absorbed into the existing model and used to defend it rather than transform it. The system becomes highly efficient at preserving what no longer fits.

This Horizon One dominance helps explain the decline of BlackBerry. Its commitment to the physical keypad reflected deep attachment to its existing model. As expectations shifted, Horizon One logic continued to shape decisions, leaving it exposed.

Failure often stems from mindset and human barriers to change, particularly when there is misalignment across horizons within organisations.

• Leaders focused on maintaining performance in Horizon One may see those in Horizon Three as unrealistic.
• Leaders in Horizon Three may become frustrated when their vision does not land and label colleagues obstructive.
• Leaders in Horizon Two may alienate others who do not yet see the value of their innovation efforts.

The art of leadership lies in integrating all three. Naming these patterns gives leaders a chance to intervene earlier.

A moment for reflection

Three Horizons is not just a strategic tool. It is a leadership mirror. You might reflect on:

• How do the dynamics between the horizons play out in your organisation?
• Where might a Three Horizons conversation create clarity or alignment?
• What is your own stretch? Which horizon do you need to engage with more constructively?

Three Horizons gives leaders a language and structure to navigate change with greater honesty, courage and coherence.

If you’d like to learn more about Three Horizons or any of the other tools or methodologies we use to help organisations unlock change, get in touch.