Innovation

Your Company Needs a Space Strategy. Now.

Rapidly falling launch costs and fleets of new satellites are opening up big opportunities for business.

by

and

Brendan Rosseau

by

and

Brendan Rosseau

From the Magazine (November–December 2022) · Long read

Antennae of the Atacama Large Millimeter/submillimeter Array (ALMA), on the Chajnantor Plateau in the Chilean Andes. European Southern Observatory/Christoph Malin (christophmalin.com)

Summary.

Space is becoming a potential source of value for businesses across a range of sectors, including agriculture, pharmaceuticals, consumer goods, and tourism. To understand what the opportunities are for your company, the authors advise you to consider the four ways in which using space could create value: data, capabilities, resources, and markets.

For most companies thinking about their space strategy over the next five to 10 years, data will be the dominant focus. For instance, many companies are turning to remote-sensing satellites for data that will inform business decisions. Whether it’s tracking the number of cars parked in retail locations, detecting costly and environmentally damaging methane leaks from natural-gas wells, or assessing soil type and moisture content to maximize crop yields, creative uses for data gathered from space abound.

Companies looking further ahead will want to explore the value to be gained from conducting activities in space, utilizing space assets, and meeting demand from the new space age.

Businesses engaging with commercial space should be willing to experiment and should look for partners.

Idea in Brief

The Situation

Space is becoming a potential source of value for businesses across a range of sectors, including agriculture, pharmaceuticals, consumer goods, and tourism.

The Explanation

Rocket launch companies like SpaceX, Blue Origin, and Sierra Space have leveraged advances in microelectronics and computing to drive down the costs of getting to space.

The Opportunities

This article examines four ways that companies can create value using space: through data, capabilities, resources, and markets. For most companies thinking about their space strategy over the next five to 10 years, data will be the dominant focus. The other areas hold promise for later exploration. Companies engaging with commercial space should be willing to experiment and look for partners.

In the early 2000s, as the U.S. space shuttle program was winding down, the government’s policy on space moved away from its model of flowing all money and decisions through NASA and the Department of Defense. Instead, it began to allow privately funded companies to compete for public-sector contracts. The Commercial Orbital Transportation Services program (commonly known as COTS) and its successors, for example, gave private companies fixed-price contracts, rather than the cost-plus contracts typically used in the space sector, to provide services to resupply the International Space Station.

A version of this article appeared in the November–December 2022 issue of Harvard Business Review.

MW

Matthew Weinzierl is the Joseph and Jacqueline Elbling Professor of Business Administration at Harvard Business School and a research associate at the National Bureau of Economic Research. His teaching and research focus on the design of economic policy and the economics and business of space.
PC

Prithwiraj (Raj) Choudhury is the Lumry Family Associate Professor at the Harvard Business School. He was an assistant professor at Wharton prior to joining Harvard. His research is focused on studying the Future of Work, especially the changing Geography of Work. In particular, he studies the productivity effects of geographic mobility of workers, causes of geographic immobility and productivity effects of remote work practices such as “work from anywhere” and “all-remote.” He is the author of the recent HBR article titled “Our Work-from-Anywhere Future.”
Tarun Khanna is the Jorge Paulo Lemann Professor at Harvard Business School, the director of Harvard’s Lakshmi Mittal South Asia Institute, and the author of Trust: Creating the Foundation for Entrepreneurship in Developing Countries (Berrett-Koehler, 2018).
AM

Alan MacCormack is the MBA Class of 1949 Adjunct Professor of Business Administration at Harvard Business School. He is an expert in the management of innovation and new product development and a core faculty member in the MS/MBA joint degree program with the School of Engineering and Applied Sciences.
BR

Brendan Rosseau is a research associate and teaching fellow at Harvard Business School.

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Your Company Needs a Space Strategy. Now.

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