“Getting things done” or “Doing the right things”? Micro-foundations of product-service strategies in Earth Observation

The space sector is transitioning from an infrastructure-driven legacy paradigm toward a commercially driven New Space paradigm. Historically characterized by high barriers to entry and demand anchored on institutional needs, the sector now faces competitive pricing, rapid technological change, and expanding commercial use cases that shape the design and development of space assets. The Earth Observation (EO) segment exemplifies this transition, as the growing commoditization of EO data challenges led to new development logics and organizational practices. Similar to other sectors experiencing rapid change, this transition is not without challenges. A central challenge for legacy EO organizations lies in reconfiguring the processes, organizational structures, and decision rules, i.e. their “micro-foundations”, that govern EO solution development. Understanding how to reconfigure such micro-foundations is of practical importance for operating within the current New Space paradigm, yet it is an under-researched perspective for organizations. Drawing on product-service system development and Operations Management literature, this study investigates how micro-foundations shape EO solution development strategies in legacy and New Space contexts. Using a multiple-case study based on semi-structured interviews and secondary data, we build on the Decoupling Point (DP) concept from operations management and propose an EO DP strategy conceptual framework. This framework explains how and where customer and user requirements enter the EO value chain and influence design and development activities, and how DP positioning revolves across organizational boundaries and inter-organizational settings. Our findings indicate that legacy space organizations adopt downstream DP strategies, in which user needs influence EO solution development mainly at later stages, reinforcing technology-push logics and limited integration of commercial needs. Conversely, New Space organizations employ dynamic DP strategies that combine customization, modularity, and standardization, enabling user needs to shape upstream design and development decisions. Importantly, we find that DP positioning in New Space organizations is not confined within firm boundaries but increasingly emerges through inter-organizational collaborations. This study contributes to research on the Space Economy by offering a fine-grained, micro-foundational explanation of diverse EO solution development strategies and their evolution. For practitioners and policymakers, the findings highlight multiple pathways for legacy organizations to maintain relevance in an evolving EO market without undermining their core capabilities and heritage. • The point where the EO value chain is decoupled, i.e. where user needs influence solution development activities, differs between legacy and New Space organizations • Legacy space organizations exhibit path-dependent processes and structures, with limited influence of user needs on upstream manufacturing activities • New Space organizations foster co-creation with users and other actors of the EO value chain, allowing user needs to permeate value chain activities • Diverse processes, capabilities, and organizational characteristics motivate the persistence of diverse EO solution development strategies between legacy and New Space organizations