Unlocking Growth and Resilience in Aerospace and Defense through Digital Transformation
The aerospace and defense industry is currently facing disruptive changes and a range of competitive challenges amidst the ongoing COVID-19 pandemic. This has led to a growing realization among executives that digital transformation is the key to overcoming these obstacles.
In fact, industry leaders expect a more than twofold increase in the sale of new digital services over the next five years. Failing to act on this imperative could lead to harmful consequences, with over 80% of executives fearing substantial cost escalations and significant market share losses.
However, businesses that prioritize digital transformation as a core component of their operations can achieve up to four times the return on their digital investments compared to their competitors. They also have a successful track record of scaling more than 50% of their digital proofs-of-concept.
To help businesses navigate this digital journey and achieve resilience and growth, we propose a three-point approach for mapping their digital future.
In fact, industry leaders expect a more than twofold increase in the sale of new digital services over the next five years. Failing to act on this imperative could lead to harmful consequences, with over 80% of executives fearing substantial cost escalations and significant market share losses.
However, businesses that prioritize digital transformation as a core component of their operations can achieve up to four times the return on their digital investments compared to their competitors. They also have a successful track record of scaling more than 50% of their digital proofs-of-concept.
To help businesses navigate this digital journey and achieve resilience and growth, we propose a three-point approach for mapping their digital future.
Navigating the Digital Landscape: What you Need to Know
Discover from industry thought leaders why digitization, co-innovation, and innovative business models are crucial for propelling growth in the Aerospace and Defense sector.
The discussions will cover topics such as transitioning from a product-based approach to delivering services, driving innovation through ecosystem collaboration, and how novel business models are revolutionizing the industry. Additionally, insights will be shared on how digital technologies can facilitate these ambitions.
The discussions will cover topics such as transitioning from a product-based approach to delivering services, driving innovation through ecosystem collaboration, and how novel business models are revolutionizing the industry. Additionally, insights will be shared on how digital technologies can facilitate these ambitions.
Substantial barriers
In the aftermath of the COVID-19 pandemic, the aerospace and defense sector is grappling with substantial disruptions and a range of daunting challenges that must be addressed.The commercial sector is currently undergoing a transition from manufacturing and supply chain operations that are led by supply to those that are driven by demand.
Growing tensions on a global scale, along with the replacement of defense platforms in the United States and Europe, will maintain the demand for the Defense industry.
The industry is experiencing a metamorphosis, moving away from product-centered business models and toward those that focus on innovative services powered by data, due to declining aircraft demand.
The competition for first-rate STEM talent is fierce, and the industry is finding it challenging to entice the most qualified candidates.
Safeguarding Health and Safety remains a Crucial Concern.
The aerospace and defense industry faces a single compelling truth due to all these disruptive factors: the vital importance of digital transformation. Leaders in the industry are aware of this and project more than a twofold increase in new digital service sales within the next five years.
A three-point plan for the digital future
Aerospace and defense companies must adapt to evolving demands, such as the move towards narrow-body and electric aircraft, as well as the decline in overall travel. To successfully navigate this shift, they must reimagine their business models while managing a Wise Pivot – striking a balance between sustaining their current business while exploring new models for the future. This requires addressing both present needs and the imperative to move decisively towards the new.
Transform the entire value chain into a digital ecosystem
Aerospace and defense companies should adopt a digital-first strategy that utilizes digital technologies to automate and streamline their operations throughout the value chain. This will enable them to enhance efficiency, address emerging portfolio requirements, and build an agile and resilient enterprise that can navigate unexpected challenges in the future.
How Collaborative Efforts Drive Innovation
Aerospace and defense companies operate in a complex ecosystem. To drive innovation and boost future-readiness, they need to collaborate across the industry and technology ecosystem, working together with a wide range of different partners, suppliers and vendors to sustain and grow overall business value.
Adopt innovative business models
As market demands in the aerospace and defense industry continue to evolve, companies must embrace new business models to remain agile and competitive. This involves striking a balance between existing operations and future-focused strategies, including the adoption of narrow-body and electric aircraft and other emerging technologies.
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