Explanation
Guiding investments by horizon is the Lean budget guardrail that helps ensure the appropriate allocation of budgets to balance near-term opportunities with long-term strategy and growth. A Lean budget guardrail is a policy or guideline that governs how the portfolio operates within the Lean budgeting system. Guiding investments by horizon means allocating budgets across three time horizons: Horizon 1 (current value streams), Horizon 2 (emerging opportunities), and Horizon 3 (exploration and innovation). This helps the portfolio balance the exploitation of existing markets with the exploration of new ones, and foster a culture of experimentation and learning. References: Lean Portfolio Management, Traditional and Lean Budgeting Approaches