Preparing industry ecosystems for the future : insights from French National Space Agency

Purpose of the paper It is now well accepted that firms' development not only depends on their individual assets, but also on the ones of many other interdependent companies (e.g. :suppliers, customers, complementors). This seems especially true in innovative sectors where firms have for long paid attention to the collective need for preparing industry for the future. Recently the term "ecosystem" has been introduced to characterize further the dynamics of such industries (Iansiti and Levien 2004). However strategies led by individual firms to prepare industry ecosystem for the future still often only rely on "maintaining health" and do not address the question of major evolutions. In such context, an important issue is therefore: how to organize the collective exploration of alternative industry ecosystems? This paper aims at filling this research gap through the in-depth case study of CNES , the French spatial agency. Theoretical background A growing body of research has shown how organizations may influence the evolution of an industry ecosystem. Research on industry architectures has contributed to explaining how organizations attempt to manipulate the way work is divided among industry participants and its impact on value creation and value appropriation (Jacobides, Knudsen et al. 2006). Companies develop strategies to get an « architectural advantage » (Ferraro and Gurses 2009) and become « focal firms » (Adner and Kapoor 2010) in the industry ecosystem. Research on industry platforms has demonstrated that platform leaders not only develop technologies but also stimulate the renewal of the whole industry ecosystem (Gawer and Cusumano 2002; Gawer and Cusumano 2008) thanks to the cooperation of new entrants or complementors which seek to create niches and to differentiate their products in innovative ways (Iansiti and Levien 2004). The concept of "industry platform" thus provides an interesting conceptual tool to further understand the industry ecosystems dynamics. However, although the issue of preparing for the future has become of strategic importance in many industries, the ways in which to collectively explore and design new industry ecosystems are still limited. Research methods We draw on extensive qualitative data collected during a one-year collaborative research (David and Hatchuel 2007) with CNES and which included several visits in its three French sites (Paris, Evry and Toulouse). The collaborative research started during winter 2009. Thanks to exploratory interviews which were primarily carried out with top-managers, the first phase made it possible to specify the scope of the study. Since the overarching research objectives were to analyze how CNES was preparing its industry ecosystem for the future, we collectively discussed various projects to be analyzed in details. We eventually decided to select examples of both past successes (atmospheric sounding and radar altimetry) and current challenges (hereafter named "DemoLaunch") in CNES' recent history. We then identified the key actors that would be interviewed to sustain our research objectives and triangulate data collection. 24 semi-structured interviews (8 interviews on each topic) were eventually organized over the next six months. The semi-structured interviews lasted, on average, 2 hours and all of them were carried out face to face but one, which was organized via videoconference. While including general questions about interviewees' background and position in the CNES organization, our interviews mainly focused on interviewees' participation to the selected projects. Empirical base CNES is the French spatial agency. It is a public organization, administratively defined as a "public administration with industrial and commercial purpose". Its mission is to coordinate and implement French spatial policy through the financing of industrial R&D projects, which aim at bringing space technologies to maturity, and the developing of innovative concepts, which aim at preparing the future of space industry. Because of major scientific and technological challenges which have historically induced firms to collaborate intensively over uncommonly long times, one of the specificities of the spatial industry is thus to tightly interconnect various actors ranging from private companies to research institutes and spatial agencies, such as CNES. This has led space actors to invent efficient strategies in which to develop and maintain current space industry ecosystem healthy. Still, according to CNES' senior managers, space actors are currently facing new issues due to new competitors coming from different industries (e.g.: Virgin Galactic and space tourism) or emerging countries (e.g.: China, India). Well aware of these difficulties, CNES was already attempting to organize such collective efforts when the collaborative research started. The case study of CNES thus gave us a rare opportunity to analyse how to collectively prepare industry ecosystem for the future. Results and managerial implications Drawing on our findings, we demonstrate that traditional strategies are now limited to cope with the challenges that are currently faced by space actors and which could threaten the whole industry ecosystem in the next future. Our findings provide documented examples of old and new strategies carried out by CNES to manage its industry ecosystem. Likewise, our findings provide an empirical based account on how an organization facing major evolutions threats can prepare for the future beyond "maintaining" strategies. As a result, the scope of our study, which specifically includes the analysis of front end design processes, suggests new directions for managers as well as policy makers in order to develop new tools and methods to sustain the collective exploration of new industry ecosystems.