When big innovation promises crash, both the technology and the promise to customers must change

Radical innovations are often associated with great promises to customers and investors. But what happens after a public and deadly failure that shatters both technology and trust? A new study examines the Virgin Galactic spacecraft crash. The researchers show that the company needed to both make the technology safer and reframe what they promised the market.

In October 2014, what must not happen happened. During a test flight of Virgin Galactic’s VSS Enterprise spacecraft, the craft crashed and the test pilot died. To investigate how Virgin Galactic operated before and after the crash, a team of researchers conducted a comprehensive study. It is based on a large body of material: press releases, media reports, social media and interviews with people who had insight into the company and the space venture.

A promise of space – and of a new industry

Before the crash, Virgin Galactic had a clear message in its communications. Customers would experience space. This meant that the spacecraft would travel across the Kármán Line, which is at an altitude of 100 kilometres and is the internationally recognized boundary to space. The company also presented itself as a space pioneer that would create a whole new industry, namely commercial space tourism.

When security changed technology

The accident was a game-changer. Virgin Galactic needed to reduce the risk of a similar accident happening again. This meant taking greater control of the development process, building in more safety features and making the spacecraft more robust.

However, the changes had consequences. The new spacecraft, VSS Unity, became heavier and the technical changes made it harder to reach the altitude that was a key part of the previous promise to customers. The company then started talking about a different space limit: 80 kilometers, which is used by the US government.

From personal space travel to larger societal vision

The increased security thus changed what Virgin Galactic could deliver. To address this, the company changed the narrative of the project. Before the crash, the experience was described as a personal spaceflight for the paying future astronauts, with the company being the first in the world to offer commercial space travel.

After the crash, the narrative changed. The promise became broader. It was now about humanity’s access to space, learning through testing, and a long-term mission to make space accessible to more people.

Technology and story must go hand in hand

The researchers’ conclusion is relevant beyond this case. After a catastrophic innovation failure, a company cannot choose between technology and communication. Both must be addressed simultaneously. New design choices that reduce risk can also reduce what can actually be delivered, thus weakening the original promise.

At the same time, a new narrative can create a credibility problem if it promises more than the revised technology can deliver. Successful projects require a new balance: what is built must match what is said.

More about the article and the authors
The article The promise-risk balance: Recalibrating design choices and strategic framing following catastrophic innovation failure is published in Administrative Science Quarterly.

Authors are Sen Chai, Mc Gill University Canada, Anil R. Doshi, UCL School of Management, UK, Luciana Silvestri, independent researcher, and Tiona Zuzul, Harvard Business School, USA.