Case 1:
X: The
Foghorn
Decision
Group 1
Aashi Jain - 143001
Abhay Kundlia - 143002
Abhinav Tagore - 143003
Aditya Sawhney - 143004
Divam Arora - 143005
Akarsh Kumar Pandey - 143006
Akash Sharma - 143007
Akshat Aggarwal - 143008
Ashima Aggarwal - 143009
Bhavesh Kakkar - 143010
Introduction
•Codenamed Foghorn: Project of X- Alphabet Inc. to develop a full scale, cost-competitive,
carbon-neutral process for converting sea water into fuel
•Alphabet's stages for project development, kill metrics, monkey and milestones etc.
•Project Foghorn seems very promising to all three core requirements
•A solid plan for reducing uncertainty, improvement in technology and reduction of per unit
cost was much required
•To kill or not to kill?
Corporate R&D Labs and The
Origins of X
•In 20th century, individual inventors were overshadowed by large industrial entities.
•Bell labs made major contributions in radios, lasers and programming languages.
•PARC (Xerox Corporation) made major advances in laser printing, graphical-user-interfaces and
ethernet networks.
•By 1990s, corporate R&D labs were struggling to justify their commercial potential.
•The advent of microprocessor made it possible for "garage entrepreneurs" to make major
advances in commercial technologies.
•However, by 21st century, giants like Apple, Microsoft and Google emerged as the leaders of a
new shift towards industrial innovation.
A Moonshot Factory
• Google decided to create a unit that would work on long-term innovations different than
the projects that google usually tackled.
• In January 2010, Google's board of directors voted to formalize this unit, funding what
came to be known as Google(x).
• Google(x)'s mission was to generate and pursue "Moonshots".
• After Google restructured itself as the conglomerate Alphabet Inc. And as a part of the
restructuring Google(x) was renamed as X.
• X was not just a factory for solutions but for Problems to be solved.
Planning the Unplannable
• Teller and X focused on churning through many projects as fast as possible and
hence hoped to explore more ideas
The typical progression of a successful X idea involved three stages:
• Stage 1- Rapid Evaluation
• Stage 2 - The Foundry
• Stage 3 - X Project
Kill Metrics, Monkeys, and
Milestones
1. Kill metrics & risk lists determined the progress of ideas through each stage of
development.
2. The initial monkey of the idea is basically the most secure & comfortable risks.
3. With the set of monkeys in hand & a set of serious of milestones it would be able to
request more resources from management.
4. The kill metrics/milestones were determined at the beginning & are held fixed
throughout.
5. kill metrics often includes economic targets referred as techno-economics
The Value of Time:
A Lesson from Loon
Killing a project also kills the imminent
breakthrough associated.
Project Loon- a network of high-altitude
balloons sailing in stratosphere, designed to
deliver high speed internet connectivity in rural
and remote areas
Initial vision was to create a ring of such
balloons, acting as floating towers, around the
world.
Over the years of development, the navigational
improvements lead to team getting a much
higher degree of control
With this feat, instead of creating a ring around
the globe, small clusters of balloons could be
made and sent to specific areas in need
This changed the entire model of Loon
Managing People: Building a
Positive Culture of Killing
• Project X wanted to avoid individuals would incorrectly intuit that the prior amount invested
in a project was relevant to the future value of that project
• X addressed these challenges through a number of mechanisms:
• Management frequently sought out individuals who displayed a high tolerance for ambiguity, risk, and failure
• X placed emphasis on employees having a flexible set of skills that could be applied to a wide range of topics
• Beyond recruitment, X instituted a number of formal and informal programs to encourage employees to kill
projects early
• kill decisions were announced and celebrated within X
• X's mission was not to develop itself into an R&D firm of any particular type but rather to be the innovation
engine of Alphabet.
Foghorn: Turning Seawater into
Fuel
IDEA:
CO2 & H2 extracted from seawater and recombined as
a hydrocarbon ready for commercial use.
ESTIMATED ULTIMATE COST:
$5-10 per gasoline gallon equivalent (gge)
Collaboration with PARC:
Formation of Foghorn
GOAL:
Developing a carbon neutral liquid fuel alternative at a cost competitive with fossil fuels
Challenges:
1. Obtaining industrial production amount of carbon
2. Obtaining industrial production amount of hydrogen
3. Combining carbon and hydrogen into end-to-end carbon neutral system
4. Achieving above steps within 5 years, keeping ultimate prices under $5 per gge
1st Prototype and Chanllenges
Accumulation of minerals on electrodialysis membrane
Unit costs going above $30 per gge
Solution:
Co-locating Foghorn technology with water desalination plants
2nd Prototype
Alternatives:
(i) Co-locating desalination plants (Ultimate cost: $8-16/gge)
(ii) Operate independently (Ultimate cost: $16-28/ gge)
Small number of desalination plants restricting alternative 1
Way Forward
Development of solid oxide electrolyzed cell for H2 extraction
Refined estimates (Dec 2015): $10-12 per gge
1 billion dollars additional fixed cost and many more years to go
Main point of the investigation which was started
"stacking moonshots".
Continuous investment relates Foghorn to any other X
To kill or
project.
Main question was to go further for funding or not ?
The project deserve more time or should be dropped.
not to Another point of decision was to publicize the listed
patents and research for the broader academic
kill community or not.
At the end, the decision taken was to kill the project
for the time being.
THANK YOU
