5 Challenges Faced by Aerospace & Defense Suppliers and How Digital Continuity Could Be the Answer

The aerospace and defense (A&D) sector is poised at an inflection point. On one hand, companies are witnessing promising levels of growth, leveraging a bullish market and cutting-edge technologies. On the other hand, several challenges lie on the road ahead, as A&D companies seek to win customer trust, strengthen their supply chains, and combat volatility in fuel prices. Research suggests that India’s defense sector has been growing at a steady pace, focused on the modernization of armed forces, and indigenization of manufacturing and suppliers. The Government is looking to accelerate this growth, aiming at a turnover of INR 1.7 trillion by 2025.

By addressing imminent challenges and streamlining operations, Indian A&D suppliers can continue this growth curve and reach their full potential capacities. At Dassault Systèmes, we believe that digital continuity will be integral to this goal, allowing companies to drive cross-disciplinary collaboration, maintain a steady flow of data, and accelerate production.

 

Challenge 1: Staying a step ahead of timelines and delivery schedules

One of the biggest challenges faced by A&D suppliers is unpredictable delays in production. It is estimated that over 50% of programs fall behind schedules, and a big reason is deferred detection of design issues. In the absence of a collaborative design process, issues can remain undetected until the manufacturing stage, causing delays. Further, this also adds to program costs, as further design efforts are required.

To address this, A&D suppliers need seamless digital continuity, powered by an integrated System Digital Mock-up (S-DMU). This brings together all the tools, stakeholders, and processes needed to develop accurate product models. Designs can be pre-validated before they enter production, avoiding costly late-stage issues.

 

Challenge 2: Scaling up production capabilities to meet demand

To effectively monetize high-demand levels, A&D suppliers need robust global networks and clear visibility into distributed operations. However, it can be difficult to scale-up production lines, particularly considering the tight timelines we are seeing today. Often, the scaling journey introduces additional waste and inefficiency into the A&D environment.

Suppliers need a solution that can accelerate ramp-up while continuously optimizing supply chain strategies. The core principle should be “global but lean,” allowing A&D companies to rapidly deliver products while managing change.

 

Challenge 3: Maintaining gross margins and market share

This is particularly relevant for small to mid-sized A&D suppliers that are competing for business. OEMs require optimized delivery of parts/systems, making it necessary for suppliers to be agile and flexible. Small to mid-sized suppliers can no longer afford a fragmented experience from bid to delivery, if they are to gain a competitive advantage and cement their market share.

Digital continuity is essential to address this, as it connects the different value streams from engineering to manufacturing. Suppliers would be able to govern the entire system from a unified platform, introducing changes in an agile model, maintaining cost efficiency and optimal delivery.

 

Challenge 4: Achieving a single source of truth for production data

Crucial data such as engineering parts and bill of materials (BOM) frequently lies in silos across the organization. Without a common change process, stakeholders struggle to get visibility and standardize change in design.

There is always the risk of BOM errors, leading to rework, and taking time away from innovation. It is estimated that 14% of an engineer’s time is spent on recreating data that could not be found and 16% on incorporating changes made by others. Collaboration on a digital platform would change this entirely. A digitalized A&D supply chain would create a single source of truth, simplifying processes significantly. This data can even be fed into a simulation engine to replicate the real-world behavior of A&D parts.

 

Challenge 5: Re-inventing supply chain to meet emerging needs

Given that A&D suppliers make up 50-60% of the industry value chain, it is imperative that they streamline procurement/distribution networks, taking advantage of enhanced collaboration at every step. This calls for tighter integration between various stakeholders, using an S-DMU.

An S-DMU would bring digital continuity, allowing OEMs and their suppliers to meaningfully contribute to production pathways with shared visibility and co-ownership. A&D suppliers, therefore, obtain an accurate understanding of the requirements and work together towards assured outcomes.

 

Leveraging the 3DEXPERIENCE Platform to empower A&D suppliers

The 3DEXPERIENCE Platform creates a collaborative space where A&D engineers, designers, production delivery managers, and other stakeholders can come together and exchange their ideas. This leads to a single, reliable source of information that can be processed automatically for optimal delivery.

At Dassault Systèmes, we are committed to helping aerospace & defense suppliers future-proof their operations. Our industry solutions experiences include Co-Design to Target (for on-time, on-target, and to-specification A&D programs), Ready for Rate (to accelerate scaling while maintaining production agility) and Engineered To Fly (streamlining supplier efforts from bid to delivery with a focus on margins. These are all based on the 3DEXPERIENCE Platform, centered around the principle of digital continuity.

Safran Transmission Systems was able to unlock 30% productivity gains by using Co-Design to Target, based on the 3DEXPERIENCE Platform. Other companies such as Messier-Bugatti-Dowty, a global leader in aircraft braking, have used Engineered to Fly and Ready for Rate to transform their manufacturing capabilities.

To know more about our Industry solution experiences, please visit: https://ifwe.3ds.com/aerospace-defense/supplier-development