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Digital Perspectives
New views. Applied now.

Digital Perspectives

New Views. Applied Now.

February 19, 2018
Realising Industry X.0 in Aerospace & Defence
By: Graham Malley

At Accenture, we believe that the scale and pace of change in the Aerospace & Defence industry demands a new industrial framework. We’re calling this framework Industry X.0; it’s a blueprint for rapid and flexible technological adoption, today and in the future, to help organisations thrive.

The Aerospace & Defence industry is the jewel in the crown of the UK’s manufacturing economy. However, as with many UK industries, Aerospace & Defence is facing a productivity challenge. As ONS stats highlight, despite enjoying a 5% annual increase in turnover between 2002 and 2015, gross value added has remained stubbornly flat in the industry. If Aerospace & Defence is to flourish in the years ahead, the productivity challenge must be addressed as a matter of urgency.

Unlock value through emerging technologies

The good news is that the industry in a good position to do so. This is because the Aerospace & Defence companies have always been at the forefront of digital technology adoption; and if they continue in this vein they’ll soon have the capabilities in place to unlock value and increase productivity.

Recent Accenture research highlighted the scale of this opportunity: by adopting the right mix of emerging technologies, including autonomous robots, mobile computing, autonomous vehicles, 3D printing and machine learning, Aerospace & Defence companies could unlock £17.5 billion in value over the next decade. This sum comprises £10 billion of cost savings and £7.5 billion of new business growth.

A new industrial framework

To fully exploit these – and future – digital technologies, Aerospace & Defence businesses need to adopt a new industrial framework; one which frees them to reinvent their core operations, user experiences and business models to enable new efficiencies and revenue streams. This lies at the heart of Accenture’s Industry X.0 framework. Industry X.0 will enable Aerospace & Defence companies to drive up productivity while leveraging new opportunities for growth.

The Industry X.0 promise

A core part of Industry X.0 is, of course, transforming manufacturing. Technologies such as the Internet of Things, machine learning and advanced automation promise to drive new efficiencies in the way Aerospace & Defence companies manufacture goods and get them to market. These changes are highly important and will go a long way towards addressing the productivity challenge; but for me, the real draw of Industry X.0 is the transformational business models that the framework enables.

For example, Digital Twin and Digital Thread technologies promise to deliver completely new after-market service wraps for engine manufacturers. By digitally linking an engine in-flight to its Digital Twin, manufacturers can run models on the engine and provide the operator with real-time intelligence on which route to fly, and at which altitude, to optimise efficiency. This approach not only brings in new revenue for the engine manufacturer, but improves margin for the operator.

Industry X.0 businesses will also be best placed to thrive amid market disruption. The emerging market for urban air taxis is a case in point. The vision of electric air mobility is close: a test flight for an urban air taxi having taken place in Dubai in 2017. Businesses that wish to join this new market will need to find ways of managing highly-complex interactions between many aircraft in an urban airspace. This can only be achieved through an Industry X.0 approach that combines high-speed connectivity with AI-enabled autonomous vehicle systems and airspace management technologies. For businesses that get this right, this is a huge potential market.

Embed a culture of innovation

Industry X.0 is the future of manufacturing in Aerospace & Defence. Our advice to businesses in this industry is clear: get your transformation underway today so you can lead the industry into this emerging era of innovation and efficiency.

A key first step is to set up a culture of digital innovation. Businesses should, at the very least, appoint Chief Digital/Data Officers to help explore new technologies and build the business case for the adoption of an Industry X.0 framework. For businesses willing to go further, they could consider establishing internal innovation incubators within their operations. These business units would be charged with finding transformational solutions to business challenges and building and testing new digital business models.

Whichever approach you take, the key is to act now. Industry X.0 businesses will soon have a significant competitive advantage; make sure that your business is one of them.

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