What can business leaders learn from space exploration?

The link between carrying out a successful rocket launch and running a market-leading business may not be immediately apparent. But much of the approach that has enabled NASA to remain at the cutting edge of aerospace engineering for more than 60 years can just as readily apply to private-sector firms. The organization’s philosophy has been characterized by a willingness to learn – from its mistakes as well as its successes – a culture that encourages and rewards risk-taking, and an understanding of the importance of diversity of thought.

Currently leading the Space initiative at the Swiss public research university ETH Zurich, Dr Thomas Zurbuchen was the Associate Administrator for the Science Mission Directorate at NASA from 2016 to 2022. We talked to Dr Zurbuchen about how companies can embed their own culture of innovation and deliver long-term success.

NASA’s approach involves setting an ambitious goal and then bringing together a diverse team of stakeholders to make that goal happen. One of NASA’s biggest strengths lies in accompanying that project from the idea stage to launch and then to operation – and I think there are a number of lessons that come from that which can be applied in the corporate world as well.

Firstly, it is really important to set big goals. At NASA, that scale of ambition is the reason the organization exists, but companies that want to survive – and indeed, prosper – in a changing and challenging environment need to follow suit. Secondly, it is helpful to understand that the unit of change or the unit of success within a company is not the individual but the team – and, ideally, a diverse team. This means you have people from different backgrounds and even different parts of the world who bring their various strengths to bear.

The third element is putting in place processes and systems that can incorporate everything the organization has learned over a period of years. If you can do this, the next mission or the next big project is likely to be more successful because it builds on the lessons and the experience of previous missions or projects.

NASA is set up to take risks, so there is a true alignment of authority and accountability across the whole organization. Take my job, for example: I had 130 missions and I was personally responsible for whether we do a mission, what exactly that mission is, whether we go from the design into the construction phase, and if we are ready to launch.

As I just said, there are a lot of people in the team with diverse viewpoints. But in the end, only one person makes a decision, and it is that person who will be blamed if the decision is wrong. So the team brings the idea, but this concept of true accountability enables the team to take risks because they have some degree of protection. In my view, this approach has helped NASA to do really important work.

For me, culture is about a number of things. The most important factor is leadership: leaders set the organization’s values and define the behaviors and the qualities that make people successful within the organization. Looking at my own role running the science program, I set rules that every launch to space needed to not only be successful but also needed to introduce a new technology. This was a way of saying that I value leaders who come up with new ideas and try things, even though they may not work.

When I started working at NASA, I changed the way we selected new missions. Until then, this had essentially been a risk discussion. People said, "Here are three potential missions, here are all the things that could go wrong," and nine times out of 10 we took the lowest-risk option. My approach was to think more like an investor and have a value discussion: so as well as the risks, what are the potential benefits? I see risk as a currency to buy more value, and risk is what it takes to do really innovative things. It is important to understand that failure is a part of success.

Success depends on having the right people within your organization and developing them. I'm a strong believer in only hiring when you have a diverse pipeline of candidates. I used the process developed by [Nobel prize-winning economist] Daniel Kahneman [which involves scoring candidates objectively on a small number of criteria]. When I hired people, as well as talking about their strengths, I would discuss the specific weaknesses we had identified. The goal here was to encourage people to build teams around themselves so those weaknesses no longer affected their behavior.

When I joined NASA, I found a lot of people who were in the wrong jobs. For example, the best operator we had on staff was in a strategic role and, frankly, he was not very good at it. He then went on to be the guy who became world-famous because he was the manager of the mission to launch the James Webb Space Telescope. Similarly, I don’t want a salesperson in a manager position – a salesperson’s strength lies in talking about a product in a positive way without really emphasizing the weaknesses and the challenges, and that is totally unsuitable for the role. I want my manager to be a person who's waking up at night thinking of problems, and who is transparent about weaknesses.

NASA has been very successful, but at the same time it is an organization that is now many decades old. I would say that the two main obstacles to learning are previous success and bureaucracy. Organizations that are leaders in their field can slip into a situation where they start patting each other on the back and forget how to use their strategic objectives. They slow down because they are so good, and they don’t have any real competition. My view is that true leaders compare themselves to their potential, not their peers.

True leaders compare themselves to their potential, not their peers.

And like other large organizations, NASA is a bureaucracy: this means that systems and processes have been created to make things better, but they calcify. Processes are introduced that do not add value, and you end up using technology from a different time. Taking advantage of new technologies does not often occur in the biggest, most successful companies – it tends to come from companies that are fighting for their survival or fighting to leave a mark.

If you look back to the 1950s and 1960s, the Apollo program was created as a government-centric contractor model – and that is not a model that can work for the future. Around 20 years ago, we got to a point where we were making and launching rockets with a single company called the United Launch Alliance. The cheapest rockets cost around USD 200 million, they couldn’t make that many of them, and, frankly, they were not that reliable.

So we decided to give opportunities to commercial entities to see if there was a market – and this coincided with a bunch of young rich guys saying they wanted to go into space – the likes of Jeff Bezos, Elon Musk and Richard Branson. The government built the systems that enabled their companies to enter the commercial launch market, and it has been a huge success. Last year, Elon Musk’s SpaceX launched 96 rockets compared to somewhere in the 80s for China and around 10 in Europe, which still has a government model. The rockets we used to buy for USD 200 million we can now buy in the open market for USD 40 million. All this has happened because those entrepreneurs applied their business innovation to the entire structure of rocket launches.

The government should take the first step and attack the boundary of ignorance.

A good way of thinking about the role of government is that they should take the first step, and attack the boundary of ignorance. For a company, the risks involved with doing something like that would be too great. Government should also create active processes and hand over the lessons learned to companies, which can then build on that initial innovation. The only thing you need to be careful of is that you don't have a government program that is wholly dependent on a single company – because then the price will go to infinity. You want competition in the free market to make sure that the taxpayer gets a good deal. But, generally speaking, the right way to do it is to turn over to companies what companies do better, and this is typically after one, two or three iterations of a product.