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The aerospace and defense industry has an enormous problem. Major airplane programs have been consistently late to market, costing companies billions and, in some cases, tens of billions of dollars in direct costs and lost sales. These delays have also led to deteriorating market values and diminished manufacturer credibility.
Accenture At The 2014 Singapore Airshow
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A primary reason these problems persist is the extraordinary complexity of today’s major airplane programs. Typically, hundreds of suppliers are involved in these initiatives and their decisions are interwoven with those of a multitude of other suppliers. Compounding this complexity, there is a wide geographic dispersion of suppliers across virtually all regions of the world: Asia-Pacific, Europe, Latin America, the Middle East, and North America. Additional byproducts of the rising rate of program delays and higher complexity include fragmented and misaligned product development processes, supply chain miscalculations as well as manufacturing and engineering inefficiencies
Solving these challenges is strategically and financially critical to the overall health of the industry and essential to drive higher revenues and profits, lower production costs, reduce time to market, and deliver more affordable and reliable flying experiences to airline passengers.
There are two aspects to this story worth watching:
First, there are repercussions about this for the Asia-Pacific market as demand from the region is rapidly growing and will outstrip that from North America or Europe within a couple decades.
Second, there is a new higher order of strategic thinking, a digital coming of age, that is fueling these changes; this will affect tens of thousands of engineers and involve billions of dollars of research and development investments.
A new and coalescing digital mindset aims to make sure the industry’s digital pipes connecting product development, engineering, supply chains and the in-service fleet keep flowing smoothly with high-quality data which is currently often lacking. One key avenue to pursue to better embrace this digital mindset is Product Lifecycle Management (PLM). PLM enables risk and cost reduction by consolidating product data, standardizing processes, reducing information searches, and distributing product information electronically through the extended aerospace enterprise. The adoption of PLM goes hand-in-hand with the new digital mindset and approach to the market.
Finally, the Asia-Pacific region is likely to be one of the most important sources of new airplane and defense system orders for aerospace manufacturers and suppliers over the next several years. The fundamental demand drivers of passenger air traffic growth and in-region military build-up are leading indicators of the market potential for digital assets ranging from product lifecycle manufacturing technologies to in-service airplane support.
February 14, 2014
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