Innovation is fraught with risk and the potential for failure, so what can we learn from how two major global players manage not only the risk but their stakeholder experience of the journey?

When it comes to successful project management, there are many ways to approach a critical project and work to ensure stakeholders are brought along for the journey, with the emerging commercial space industry a case in point.

Here, the major players — Boeing and SpaceX – are taking very different paths as they push forward with plans to take passengers into orbit in the near future.

Boeing and SpaceX locked in a new space race

The stakes are high for both firms. Boeing and rival SpaceX, owned by billionaire Elon Musk, are jostling to become the first private firm to resume human space flight from US soil after NASA’s space shuttle program wrapped up in 2011, with billions of dollars on the line.

It should be noted at the outset that both the global aerospace giant and the commercial space upstart abide by many fundamentals of stakeholder engagement, following tried and tested corporate groundwork when it comes to this area of successful project management.

For instance, in terms of their space programs, both operators begin with community involvement, work to understand stakeholder values, make sure to give their stakeholders a voice and demonstrate that they are taking stakeholder input onboard, whether that’s via social media in the case of Space X or real-life forums.

Both companies also are getting bankrolled, in part, by the US space agency NASA, which is paying Boeing in excess of $5 billion to develop and run missions carrying astronauts to and from the international space station. SpaceX, meanwhile, has also received deals reportedly worth more than $3 billion from NASA for its Crew Dragon spacecraft.

But beyond the basics, the companies have taken markedly different approaches to engaging and retaining stakeholders, illustrating the multiple strategies open to organisations when it comes to bringing millions of potential customers along for the journey to market.

Boeing and SpaceX engage stakeholders differently

Boeing, founded in 1916, has, somewhat predictably, taken a more orthodox approach to its commercial space mission. For example, to bring stakeholders on its pioneering journey, the company has recently been talking up its technical bona fides such as a partnership with NASA on developing its CST-100 Starliner spacecraft and its work with the US military.

SpaceX, by contrast, has, since its entry into the space race, been more focused on engaging stakeholders with both the boldness and ambition of its mission and the vision of founder Musk. It has effectively asked consumers to buy into its risky undertaking. Indeed, Musk has taken extreme risks with his radical rethink of exploring the final frontier, which is a big part of how SpaceX has positioned and continues to spruik itself, in the market.

This is clear from the interplay between Musk and the market. Perhaps his most clear demonstration of an ability to embrace risk and fail as an inherent part of his mission was a series of tweets in 2016 celebrating the destruction of the company’s hundred-million-dollar rockets. In that case, the SpaceX failed to land a single Falcon 9 booster back in June 2016.

The importance of ‘framing’ failure

Musk’s approach to failure helps keep stakeholders on board with the company’s mission. That’s because, as well as helping to bring innovative and untested ideas to completion, this approach to failure can be thought of as an ingenious use of what Harvard Business School Management Practice Professor, Sandra Sucher, calls “framing”.

This concept, Sucher writes in the Harvard Business Review, describes the nature of a problem faced and shapes how it is viewed. It also contains the seeds of action and response.

As she explains: “you need to decide what kind of problem you are facing, and you need to describe it in clear language that will help the people who have to execute inside the company, as well as those who are judging it from the outside, understand how the company is thinking about the kind of problem they face”.

Framing used by SpaceX in its commercial failures is in stark contrast to Boeing, especially as it relates to the company’s recent crisis related to its 737 MAX aircraft. The aircraft has been grounded globally since the March 10 crash of an Ethiopian Airlines flight, which followed a crash late last year of a Lion Air flight in Indonesia. The two incidents claimed 346 lives.

Boeing ‘spinning’ wins, hiding failures

Whereas SpaceX celebrates its failures as a necessary part of innovation, Boeing has received widespread condemnation for trying to spin their mistakes and potentially dodge accountability for corporate missteps that contributed to the disasters.

Here, Sucher argues, the problem is essentially one of framing. In her opinion, rather than acting quickly to temporarily ground planes, Boeing insisted the aircraft was safe. If it had taken another approach, by grounding planes immediately and characterising the crashes as involving “technical problem that we do not fully understand”, she suggests that stakeholders, such as passengers and airlines, may not have abandoned the company.

Essentially, the outcome of Boeing’s framing is a market perception that its failures are opaque and that its wins are spun. SpaceX’s framing, on the other hand, not only keeps its failures much more transparent but uses them as leverage. Just this month it made an upbeat announcement regarding a “major failure” of its Starship rocket prototype.

So, while Space X and Boeing battle for dominance in orbit, their approach to taking stakeholders on the project journey with them show how critical it is for organisations, irrespective of the sector, to get their messaging around failure correct, especially given its crucial role in innovation and ultimately successful project delivery.

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