In an era of climate crisis, digital transformation and social change, it is no longer enough to improve what is. To create sustainable societies, we need to change entire systems, how we produce, consume, organize and collaborate.
One of the most useful methods for understanding and driving such changes is Three Horizons, a model that helps us both see the limitations of the current system and start shaping future solutions, already today.
What are Three Horizons?
Three Horizons (3H) is a strategic model that helps structure transformation over time. The model divides development into three “horizons”:
- Horizon 1 (H1): The current dominant system. What we do today. Functioning but often unsustainable in the long term.
- Horizon 2 (H2): Innovation zones. Experiments, intermediate forms and transitional solutions. This is where competing logics are born.
- Horizon 3 (H3): The desired future. Visionary solutions that represent a new paradigm.
The model is not used to predict the future, but to create conversations between different actors about how change can happen. It is about identifying which parts of today’s system should be preserved, which should be changed and which new elements need to emerge.
Why use 3H?
Three Horizons is particularly useful in system innovation, where change is not just about new technology or new products but about the interaction between people, rules, resources, culture and values. It provides structure for conversations between actors with different perspectives and helps to see beyond the next quarter or year.
The method opens up to thinking in parallel. Maintaining what works today while experimenting with the new and starting to realize long-term goals. It helps to avoid the classic trap of either getting stuck in the problems of the present or in the fantasies of the future.
Connection to the five principles of system innovation
Three Horizons fits well with the way we define system innovation, through five principles:
- System understanding: Through 3H, you get a view of both the current system and possible future states and also how they relate.
- Shared direction: H3 serves as the goal image, the vision that different actors can agree on.
- Portfolios of initiatives: H2 represents precisely this many parallel efforts, experiments and test beds that can scale up future solutions.
- Interaction and relationships: 3H promotes collaboration by creating space for different actors to talk about their perspectives on the present, the future and change.
- Learning over time: The model emphasizes development over time, where we learn along the way and adjust direction based on experiences.
These principles are not isolated, they influence and reinforce each other. Understanding how relationships and learning develop over time is crucial to moving between horizons.
How do you do it practically?
Working with Three Horizons can be done in a workshop or a longer process. Here is a simplified method to get started:
- Create consensus on the current situation (H1): What characterizes today’s system? What norms, drivers, technologies and relationships govern? What are the limitations?
- Explore the future (H3): What is our vision for a future sustainable system? What could a value ecosystem look like instead of a linear value chain?
- Identify transitions (H2): What initiatives, experiments and projects already exist today that point towards H3? How can they be supported, scaled or spread?
- Map tensions: Where is the friction between H1 and H3? How does the old system react to the new?
- Build portfolios: Organize a variety of efforts that address both technical, cultural, organizational and economic aspects.
An important part is to let different voices have their say. Innovators, decision-makers, practitioners, citizens and seeing the model as a living conversation tool, not a fixed schedule.
Example
From value chain to value ecosystem in the textile industry
Imagine a company that manufactures workwear. In Horizon 1, the model is linear: raw materials are purchased, clothes are manufactured, used and thrown away. When the company starts to see the problems with waste and resource consumption, Horizon 2 initiatives are created: reuse, rental, design for disassembly. But real transformation requires Horizon 3: a new type of value ecosystem where clothes are designed in collaboration with those who use, repair, wash and recycle them.
This means starting to co-design with laundries and recycling operators, introducing digital platforms for traceability and moving the business model from sales to service.
By using Three Horizons, the company can identify which parts of the current model need to be preserved (e.g. high quality), which need to be transformed (e.g. single-use), and which need to grow (circular collaborations). In this way, they build not only a sustainable business but a completely new system where value is created in relationships between many actors.
