EXPEN$IVE. abundant. lucrative CHALLENGING $$$ Curious? See Next Page. FACT 1 Space activity is: FACT 2 Business Models are: Evolving

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2 FACT Space activity is: EXPEN$IVE >>> $$$ Open Innovation (Chesbrough, 2003) Chain-linked Closed Model (Kline and Rosemburg, 986) FACT 2 Business Models are: Evolving Closed Interactive Model (Nelson and Winter, ) Linear Closed Model (Schmookler, ) Linear Closed Model (Schumpeter, 9) >>> Open Innovation is the process of strategically managing the sharing of ideas and resources among entities to co-create value. Mission Statement Collaboration & Competition >>> <<< Our mission is to explore and identify the benefits and limitations of Open Innovation concepts and to develop a case study that makes recommendations regarding the suitability of specific Open Innovation models to the Space Sector. Curious? See Next Page DETECTION TRACKING CHARACTERIZATION MINING <<< Roadmap <<< Case Study FACT 3, 4 & 5 Asteroids are: abundant >>> lucrative CHALLENGING 2

3 0 Introduction 02 Motivation To Whom It May Concern, The space sector is complex, expensive, and restricted by a variety of technological, legal, financial, and political factors. Historically, the sector has been dominated by closed business models and more recently, innovation has been perceived as slow and stifled. The following Executive Summary presents core information from the report Open Innovation in the Space Sector prepared by a team of 33 participants and an array of academic and professional advisors. The report includes our analysis of Open Innovation trends and our conclusions regarding their applicability to the space sector. While traditional innovation approaches have been described as highly guarded and closed to outsiders, a growing number of organizations are opening up their processes and fostering new collaborations with external actors. Understanding the viability of these approaches for the space sector may yield tangible benefits. Purpose We hope you will find this report useful, SSP4 Open Innovation Team The ultimate goal of this project is to identify whether Open Innovation (OI) models may be sustainably adopted by space sector actors. In this pursuit, the team aspires to achieve three goals:. To define specific OI methods and models that may be applied to the space sector 2. To use asteroid mining as a case study to illustrate the benefits and limitations of OI 3. To make recommendations of how OI may be applied to other space activities 3 4

4 03 Innovation Models Open Innovation Closed Innovation is the process of approaching each phase of the innovation linearly while relying exclusively on internal resources to create value. Features: Assumes all the smartest people work for us A non-collaborative approach with external actors Linear business models Strengths: More easily protects core competencies and IP Entities keep 00% of profits Efficient control of innovation process Weaknesses and Risks: Potentially high R&D costs Many ideas may not make it to market Difficult to collaborate with external entities when the need arises Features: Assumes not all the smartest people work for us Share risks and rewards with potential partners Flow of information and knowledge between actors Strengths: Added benefit of using external resources Reduced R&D risks through cost sharing Possible penetration into new markets is the process of strategically managing the sharing of ideas and resources among entities to co-create value. Weaknesses and Risks: Additional steps required to protect IP Increased complexity of management and coordination costs Less direct control over certain processes 5 6

5 04 Methodology & Survey - We agree with the report definition of Open Innovation 2- We currently apply OI methodologies in our work as per our understanding 3 - OI is a risk/threat to our business development plans How we do it?. Taking experience and best practices from terrestrial applications 2. Perform overarching analysis of OI implementation in the space sector 3. Perform detailed analysis in selected case study 4 - OI will disrupt the way we do space business in the near future Current legal framework is a hinderance to OI application in space Current evaluation of technical feasibility in asteroid mining high strongly disagree 2-disagree 3 - neutral 4- agree 5 - strongly agree 7- Current evaluation of commercial feasibility in asteroid mining is high OI in the Terrestrial Sector We performed a literature review of innovation and analyzed examples of OI in terrestrial organizations to identify best practices. Representatives of 5 space agencies and 4 space firms participated in this survey OI in the Space Sector We looked for evidence of OI practices in the space sector. We distributed a survey on the use of OI and collected responses from national space agency and industry professionals. Case Study: OI in Asteroid Mining We selected asteroid mining as a space industry case study to demonstrate how OI might provide benefits to the sector. 5 M C Dathan 2 William J. Pomerantz Werner Balogh 3 Yuta Nakajima Michael Simpson Frank Morring 4 Dallas G. Bienhoff 7. Aviation Week; 2.Virgin Galactic, Vice President, Special Projects; 3. JAXA, Satellite AOCS engineer; 4. Space Project Manager in a major aerospace company 5. ISRO - Director, Vikram Sarabhai Space Center 8

6 05 OI in the Space Sector In case of the space sector, which is more sophisticated in respect to management & technology, multiple areas of potential implementation were investigated, identified and are presented below. CRIAQ Co-Design CEDIC LivinLab Tesla Motors Inside-Out Procter & Gamble Outside- in Fiat Mio Sharing of Cost Sharing of Risk Benefits Decreased Development Times Co-Creation Coupled Terrestrial Crowd Sourcing XiaoMi Bring in Ideas and Resources Go Corporation Economical Financial Implications Managerial Legal Technical Policy Crowd Funding AppStori Open Innovation is a well established concept in terrestrial applications and the effectiveness of different OI models was proven by many individual examples, of which a few are presented here. Space 9 0 Low TRLS Commercialization Process Risks Partner Selection Intellectual Property Industrial Property Copyright Scope of Application Low TRLS Early Stage of Innovation Process Accelerated Commercialization

7 06 Case Study Detection Tracking Characterization Mining A constellation of space telescopes in LEO will scout the sky to search for asteroids while empowering new communities to participate in space activities. Identify, track and fly-by the asteroids that travel between the Earth and the Moon and collect data. Orbiting the asteroid, spacecraft will collect data on the asteroid shapes, rotations, densities, and surface and sub-surface compositions. In-situ extraction of water to provide life-supporting and manufacturing capabilities in space including drinking water, breathable air, radiation shielding, and rocket fuel. Gamification Big Data Prize Model Co-Design, Fab Labs We can engage gamers by creating an interactive video game framework simulating complex real-world problems. Users can work with the asteroid mining company to obtain data products, like asteroid characterization, tailored to their needs. Space actors should offer prizes to improve mission and asteroid mining technology and infrastructure once missions are operational. Space actors should foster community interest in nascent industries by co-designing new drilling methods or innovative remote sensors for prospector satellites. This will empower each of the actors with an enhanced network of people with the right skills and competencies to help grow the market. 2

8 07 Conclusions s OI Application Opportunities in Project Phases 0 A B C D E mission analysis feasibility preliminary design detailed design production/testing utilization F disposal The findings of this report suggest that the application of OI in the space sector is currently limited to early mission phases and technology development at low TRL, but through strategic planning there is potential for OI application in higher TRL. Our team concludes that OI can add value to the space sector by tapping external communities for expertise and resources. The best OI methods to implement for a specific case are determined by whether the primary actor is part of a national space program or a private company and depend on the type of challenge requiring a solution. OI Opportunities Call for Proposals 2 Development Problem 3 Design Specific OI Solutions Quality $ Cost Schedule Design $ 3 Design 2 $ OI Method $ 2 Design 3 $ Step Mission or technology development focus? Step 2 What development problem? - mission = identify phase - technology development = cost, schedule, or quality Step 3 Find OI methods available as solution A #4: Researchers should develop a toolkit of OI methods to assist space sector actors in identifying the viability of an Open Innovation approach. #6: Asteroid mining companies should use more Open Innovation methods to accelerate the project development process. #: National space agencies should consider how to apply Open Innovation in mission phases A, B, and C at the beginning of each project. 3 #2: Organizations should find the right balance between open and closed innovation models. innovation models. #3: National space agencies should advance a mechanism to resurface discontinued research projects to take advantage of existing innovative ideas. proposals more the space sector to identify the viability of an Open Innovation approach. #5: Private entities should determine at what technology readiness levels Open Innovation can be best implemented. This decision should be made in reference to particular business and operational models. the business case to the first successful Asteroid Mining missions. #7: The United Nations and national entities should clarify regulatory frameworks to enable new applications in the space sector. 4

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