Disruptive Innovation


“If I’d asked my customers what they wanted, they’d have said a faster horse.”
–Henry Ford

Based on search terms used by visitors to Leading Space, many are interested in transactional and transformational change.  And why not?  The topics of change and innovation are quite popular in both the public and private sector.  Closer to home, we are on the verge of both houses of Congress passing a landmark NASA Authorization bill that, depending on one’s perspective, injects needed change in how the United States conducts human spaceflight: relying upon commercial entities to provide routine access services to low Earth orbit, and permitting NASA to focus upon beyond low Earth orbit exploration and “game-changing” technologies necessary to make that happen.

That is not what I’m going to write about today.

Instead, I’m going to focus on an aspect of innovation whose terminology is fairly new to my realm of understanding.  However, the associated framework has crystallized several key thoughts I’ve been mulling in recent months.  That term is disruptive innovation.

The term disruptive innovation, and its earlier form disruptive technology, were coined by Clayton Christensen in articles and books he wrote in the mid 1990’s and early 2000’s when describing how it is that large companies can fail to see and react to new technologies and innovations because of their current successes.  However, the concept pre-dates the time of Christensen’s writings.  One of the most often cited earlier references is the quote from Henry Ford, above. This statement reveals one of the key characteristics of a disruptive innovation, in that it gives a customer what s/he needs, rather than what s/he wants.  We see the same thing in action today, most notably by Apple with the introduction nearly a decade ago of the iPod, followed by the iPhone and most recently the iPad.

In the space realm, we have the potential for a disruptive innovation with the introduction of commercial crew and cargo transportation services.  Much of the debate around commercial versus government has centered on capabilities of today and projecting a future performance curve based on previous experiences with government systems.  Concerns over safety and demonstrated reliability enter into the fray, as do costs.

To turn the discussion into one of a disruptive innovation, we need to understand a key measure: performance over time.  In the case of a standard process or system, the performance over time trajectory tends to be flat or changing with a shallow slope (and hopefully with a positive sign, or we have bigger problems).  In the case of a disruptive innovation, the performance over time trajectory is much steeper.  What is typical about disruptive innovations is that when they are initially identified, their performance is typically lower than that of the standard process or system.  However, due to the steeper performance over time slope, the disruptive innovation can meet, even exceed, the performance of the standard process or system.

Take crew and cargo transportation services as an example.  Today’s government-provided system is the shuttle, due to be retired soon.  Depending on who you ask, and what axe that person has to grind, the cost of a shuttle flight is anywhere from $400 million to $1 billion per flight for delivering 7 crew members and roughly 50,000 pounds of cargo to low Earth orbit.  The reason the cost number is hard to pin down is due in part to the associated processes and systems used to prepare, launch, and operate the shuttle, requiring a large fixed infrastructure and workforce.  (I’ve been through this exercise myself earlier in my NASA career as a group lead.  When asked to calculate the difference in cost for running my group of flight controllers for 4, 5, or 6 shuttle flights per year, the answer came out close enough to the same as to render the difference moot.)  The shuttle is extremely capable performance-wise for delivering cargo and crew to low Earth orbit; in fact, it is unmatched today by any existing system for the tonnage of cargo or the number of crew members that can be flown in a single launch.

So, are commercial crew and cargo transportation services a disruptive innovation compared with the government-provided system?  To answer that, we need to look at the following:

Determine whether the innovation is disruptive or sustaining. Christensen offers that one could look at the position of the marketing and financial managers versus the technical staff with an outstanding track record.  If there is an internal disagreement between the two communities, one is probably looking at a disruptive innovation.  If one were to substitute “public sector policy makers” for the marketing and financial managers, I’d say we have a sign of a possible disruptive innovation, whether we are talking about existing expendable launch vehicles such as Delta II/IV or Titan V, or vehicles in development such as Falcon 9.

Define the strategic significance of the disruptive innovation. Here, we have to ask the right people the right questions to get a clear understanding of the significance of commercial crew and cargo transportation services as a disruptive innovation.  This is a bit tricky, because as Christensen points out, current customers are typically not the right people to ask; they will give a great answer for assessing the potential of sustaining efforts, yet are notoriously bad at identifying disruptive innovation.  (Take the Henry Ford case as an example.)  It’s also a bit challenging to inquire with emerging markets, because in the case of commercial crew and cargo transportation services, there is Bigelow, and that’s all that I’m aware of.  Yet there is an angle unique to the public sector involvement, and that is one of policy: using commercial services for routine access to low Earth orbit frees the government to invest in exploration beyond low Earth orbit.  This is a significant strategic point that cannot be underemphasized.

Place responsibility for building a disruptive innovation in an independent organization, and keep it independent. The reason for keeping the development of the disruptive innovation separate from the sustaining effort is that by integrating them together, the disruptive innovation is often the one that gets cannibalized when the going gets tough.  By keeping them separate and measuring performance and outcomes independently, the disruptive innovation is allowed to develop fully.  In the case of crew and cargo transportation services, NASA appears to be embracing this advice for the most part: the government-supplied system is being managed by one organization, and the commercial transportations services by another.  The challenge will be when the day comes that NASA has to face budget cuts, where will those cuts be made?  Additionally, when the commercial transportation services reach a state of readiness, how will they be managed?  These are open questions.

Whether you agree with my analysis above or not, I found the examination of disruptive innovation in the context of crew and cargo transportation services quite useful in looking at my current role in mission operations in Houston.  I see some strong analogies between our situation and the above, and I believe firmly that my work can benefit greatly from an analysis of disruptive innovation.  Those details are for another time and place.

What are your thoughts about disruptive innovation in human spaceflight?

Sound Bites


“Now is not the time for sound-bites. I can feel the hand of history on my shoulder.”
–Tony Blair

“We have been trying to relive Apollo for 40 years now.”

I don’t know about you, but when I hear that phrase, it’s like raking fingernails across a blackboard.  Nothing gets my dander up than to discount one of the greatest feats in the 20th century.  President John F. Kennedy threw down the gauntlet in 1961: we would land a man on the moon before the end of the decade and return him safely to earth.  And by golly, we did it!

Pause.

Why is my initial reaction defensive?

Therein is the danger of using sound bites to communicate a very complicated situation.  I hear, “Blah blah negative blah Apollo blah blah.”  Hence my reaction, and I’m sure that others may react similarly.  Yet underlying this statement are some very important truths that warrant airing.  So, for my own benefit, and maybe for yours, gentle reader, I’ll examine the situation in human spaceflight with some comparisons of then versus today.

In other words, let’s cut through the sound bite and get to some truths.

Alignment.  The Apollo Program marks one of those seeming rare instances where the political leadership, industry, and the public were near universal in their support for human spaceflight, and with good reason.  The climate was one dominated by opposing superpowers demonstrating through various means how one side was somehow better than the other – politically, technologically, idealistically, etc.  We were in a race, one that demonstrated “soft power” and world influence through peaceful means.  In contrast, today is a different world with different demands.  The Cold War is over.  It’s a monopolar world (for now).  National priorities are elsewhere, leaving the government-run human space exploration effort as one of dozens of government discretionary efforts competing for attention. What was once a standard of bipartisanship, the conversation around human space exploration is devolving into partisan politics. As such, the attention of key stakeholders is influenced by pork-barrel politics and competing special interests, perhaps more so than I’m sure the space community would like to see. Viewed through this lens, today’s human spaceflight effort is suffering from a de-emphasis in the national consciousness and from a lack of alignment among the stakeholders. For us to proceed as if human spaceflight is just as important now to the political leadership as it was in the 1960’s is naïve.

Money.  At the height of the Apollo Program in 1966, NASA’s budget was $5.9 billion out of a total federal budget of $110 billion, or 5.5% of the total – a sizeable fraction of the government’s spending at the time. (Expressed in today’s dollars, this would equate to a NASA budget of $32 billion out of a total federal budget of $580 billion.)  I’ve heard this called “war-time spending without shooting bullets.”  Today, NASA’s budget is $19 billion out of a total federal budget of $3.6 trillion, or 0.52% of the total.  That is not a typo – as a percentage of the overall federal budget, NASA now commands a factor of ten less than what it did at the height of Apollo.  The good news (if you can call it that) is that since 1987, NASA’s budget has been more or less constant when expressed in today’s dollars, hovering around $17 billion plus or minus $2 billion.  One would not be remiss in assuming that NASA’s future budget is more than likely to continue the flat trend rather than to ramp upward; at least, that is what I would assume.  (Others may argue that with an increasing deficit and national debt and with a greater percentage of the budget tied to non-discretionary spending, all future discretionary spending is at risk.)

So, we have a two-faceted challenge: one of alignment – getting the attention of key stakeholders in an increasingly distracted world – and one of living within a flat budget.  This clearly is not the world of the 1960’s.

To move forward, we need more than sound bites.

We need to “recapture the spirit of Apollo” by bringing together all the stakeholders – political and technical; within the space community and in the general public – with a compelling and affordable approach to human space exploration while embracing the hard truths about competing national priorities and fiscal realities.  The challenge for human spaceflight – creating an affordable and sustainable human presence in space in the current climate – will be incredibly hard.  Yet as Kennedy said in his 1961 speech at Rice University, we choose to go to the moon, not because it is easy, but because it is hard.  This new challenge will be every bit as hard if not harder than that we faced in the 1960’s.

I love a good challenge… do you?

Thinking Outside the Box


“The significant problems we face cannot be solved by the same level of thinking that created them.”
–Albert Einstein

A week ago I relocated offices, returning to my normal office for the first time in four years, after being on special assignment in “The Bunker” for the last three years and spending a year at NASA Headquarters in Washington, DC for the year before that.  After most recently concluding the very successful procurement strategy and competition for the Neutral Buoyancy Laboratory and Space Vehicle Mockup Facility in August, I’m now in a holding pattern, and it feels weird.  In part, the reason for the holding pattern is because at the time I’m writing this, the NASA authorization and appropriations bills for the new fiscal year (which starts in a few weeks on October 1) have yet to be passed by Congress, and in part because my organization is waiting for a resulting funding decision from NASA Headquarters.  It’s an example, both on the Hill as well as locally, of money being the driver.  It is that situation which brought to mind the Einstein quote at the top, and the topic for this post: how can I change my thinking about the situation so that I can begin to move forward on future strategies?

To provide some context, let me share with you a little of what it is like to live inside a large government bureaucracy funded on an annual basis.  Because of the large changes in human spaceflight policy proposed by the Obama Administration in February of this year, I am seeing the following at present, now that Congress is executing its Constitutionally mandated role:

  • Money is driving policy.
  • Money is driving strategy.

More specifically for NASA’s human spaceflight endeavor and my organization,

  • Uncertainty in funding is driving near-term uncertainty in human spaceflight policy.
  • Uncertainty in funding is driving near-term uncertainty in my organization’s strategy.

So, until Congress passes appropriations for the coming fiscal year, and NASA Headquarters divides the funding below the levels specified by Congress, I’m at a standstill when to comes to my future-planning role for my organization.

As I wrote the above, I came to a realization: such thinking is an example of inside-the-box thinking.  Instead, what I need to do is think broader.  To explore outside the box, I’m following advice from Holly G. Green, who suggests success visioning as a way to ask the right questions.  Therefore, by focusing on where the organization wants to go (the target destination) and picturing what it looks like when the organization gets there, I can begin to think outside the box.  Here is an example:

  • If funding were not an object, what does the future look like?
  • What policies did we put into place to make it happen?
  • What strategies did we follow to make it happen?

From here, I can examine various scenarios of the future to help frame next steps that can be taken independent of and pending any resolution from Congress and NASA Headquarters.  This is the kind of proactive stance that I much prefer to sitting around, waiting for something to happen.

As I see it, success visioning is a method to realize the new kind of thinking that Einstein says is needed to solve the problem created by old thinking.

What would you add?

GOVgreen


“The future will be green, or not at all. This truth lies at the heart of humankind’s most pressing challenge: to learn to live in harmony with the Earth on a genuinely sustainable basis.”
–Sir Jonathon Porritt

I’m a supporter of sustainability efforts, as evidenced by my open support for building an affordable and sustainable human presence in space.  But it goes deeper than that.  Sustainability is important to me in other ways, such as my active involvement in recycling, smart energy and water use, and managing my carbon footprint.  I also am thrilled to see the efforts at NASA’s Johnson Space Center for new construction and renovation achieving certification under Leadership in Energy & Environmental Design (LEED), the internationally recognized green building certification system.  By my count, there are eight different projects at the Johnson Space Center that have or will soon achieve LEED certification. One recent example is Building 20, shown in the photo at the top of this post.

When I got word about the upcoming GOVgreen Conference & Expo, taking place November 9-10, 2010 in Washington, DC, I decided to share it with you.  The sponsor for the GOVgreen Conference & Expo, the  Center for Environmental Innovation and Leadership (CEIL), is featuring an interview with Olga Dominguez, Assistant Administrator, Office of Strategic Infrastructure at NASA in its weekly “Green Government” podcast. In addition, Olga will be speaking at the upcoming GOVgreen Conference & Expo.

Organized by CEIL, GOVgreen is the only all green, all government conference that brings together agencies, contractors and suppliers to learn how to achieve the sustainability goals mandated by the President’s Executive Order 13514, focusing on federal leadership in environmental, energy, and economic performance.

GOVgreen is free for all federal government and military personnel to attend and offers a variety of programs from notable and respected speakers including Robert F. Kennedy Jr. and Dr. Dorothy Robyn, Deputy Under Secretary of Defense, Installations and Environment at the Department of Defense.

The full speaker list and program can be viewed at http://www.GOVgreen.org,  and you can register for GOVgreen at http://bit.ly/RegisterGOVgreen.

If you’re in the federal government or military and are a supporter of sustainability efforts, please consider attending this event to engage and interact with others making a difference for a sustainable future.