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What’s Dragging Aerospace & Defense Production Cycles?

As World War II ended, a new conflict began. This wasn’t a confrontation of gunfire and trenches; it was a competition with science and intellect. 

The Space Race may have been settled, but we are still striving to expand the limits of the explored universe, improve our aerospace and defense technology and make travel faster and more comfortable. It’s no wonder our recent aerospace and defense research clearly indicates that time-to-market is getting faster.

We see it in every industry, from automotive to healthcare to retail. Technology is becoming more complex, but production cycles are accelerating…and that’s only expected to continue.

In Jabil’s Aerospace and Defense Manufacturing Trends survey, 25 percent of participants say that time-to-market has become more than two times faster over the past five years, 37 percent assert it has gotten 50-100 percent faster and 30 percent estimate it has become 20-50 percent faster. Download the full survey report.

aerospace and defense production cycles - drivers of shorter time-to-market

There are several factors driving this accelerated time-to-market. According to our survey, aerospace and defense stakeholders attribute this to numerous reasons, including: 

  • innovations in supply chain that enable faster production 
  • changing customer expectations 
  • growing connectivity options 
  • government initiatives aimed at faster production

However, they agree that the most prominent reason is the increasing urgency for innovation.

Accelerated Innovation is Driving Time-to-Market

In our survey, 61 percent say that new technology innovation is driving the increased time-to-market. In the past, investing in new solutions has not been a high priority for aerospace and defense stakeholders. Defense contractors have historically been among the most risk-averse sectors, often opting to return capital to shareholders through share buybacks and dividend payouts, leaving research and development wanting, according to PwC

aerospace and defense production cycles - time-to-market expectations

From a defense perspective, while the United States (U.S.) may not be lagging other countries in terms of cutting-edge technology, it needs to make strategic investments to keep ahead. The U.S. government has recently recognized the urgency to increase its investment in building its military. In March 2019, the president requested a $750 billion Pentagon budget for defense for 2020, an increase of 4.7 percent over the budget for 2019.

On the commercial side, airlines are beginning to adopt optics for situational awareness, operating by a concept similar to autonomous vehicles. Additionally, airplanes are on the path to becoming completely connected. Other burgeoning technologies, such as the upcoming genesis of 5G networks and the advancement of artificial intelligence, will revolutionize air travel.

To state an obvious yet overlooked principle: no one has ever gotten ahead by failing to modernize and improve their technology and capabilities.

In order to offer the best technologies and experience, companies and governments need to invest in pioneering original solutions. After all, innovation is not a passing trend; it is an ongoing necessity. Over half of Jabil survey participants affirmed that it is “critically important” to their ongoing business strategy with 45 percent labeling it “very important.”

aerospace and defense production cycles - the importance of innovation

Despite most companies acknowledging the cruciality of creating new products, what is preventing companies from speeding up their time-to-market?

What’s Holding Back Aerospace & Defense Production Cycles?

Component Shortages

One of the leading challenges in speeding up time-to-market is component shortages. The aerospace and defense industry first felt the pinch of the component shortage later than most industries. Because of its robust inventory and safety stock, buffer components delayed the allocation impact, meaning that the shortage affected aerospace and defense after it hit the consumer market. 

Because defense spending is on the rise, a common pain point is that there is a plethora of high-tech applications where reliability is a must. Last year, the allocations were centered on caps and resistors out of Asia. This year, the constrained items are customized devices for aerospace and defense. Many components are being made by smaller brands that do something very high-end and exotic, and the demand is outstripping their capacity. 

Additionally, now that these caps and resistors have reached their maximum capacity, the majority of global demand is directed toward smaller components, edging larger case sizes out of the manufacturing catalog. Nevertheless, defense and aerospace stakeholders continue to use these larger parts, either because they are clinging to designs from a decade ago or the larger components have electrical properties that are built into a high-reliability system. This harnesses special attributes, such as tolerance, heat dissipation and electrical performance.  

That said, the cost to modify a defense or an aerospace design is extremely expensive. Therefore, a future pain point for defense and aerospace is that as these large case size resistors and capacitors go obsolete in 2022 and beyond, brands will be forced to contend with millions of dollars of redesign and requalification costs.  

To avoid being trapped by the component shortage, companies are starting to look at lifetime buys. They are looking for partners that can help them manage their supply chain and determine what parts will become obsolete.

Security and Safety Regulations

Another significant challenge is the need for security and safety certifications. Whether commercial or military, aerospace and defense is a high-risk industry. While manufacturing cutting-edge solutions and high-tech applications, they cannot shortchange security; they must continue to meet the stringent standards enforced by the Federal Aviation Administration (FAA), Department of Defense (DOD) and other regulatory offices. 

The U.S. government has recognized the need to speed up the production cycle and is acting to peel back some of the red tape. The Section 809 Panel, a Congress-appointed taskforce responsible for suggesting ways to streamline and improve the defense acquisition system, released its third volume of recommendations to expedite the Defense Department’s acquisition bureaucracy in January 2019. The steps they have proposed – such as removing unnecessary layers of approval in the multiple steps contracting officers and program managers must take – are designed to help companies meet regulations and bring their products to market faster.

So, what can brands do to optimize their productivity and ensure the quickest and most efficient time-to-market strategy?

How can Aerospace and Defense Reach a More Efficient Time-to-Market Strategy?

Maintain Visibility

Companies need to work with suppliers and manufacturers that offer total visibility and traceability through the entire manufacturing process. They need an end-to-end view of their production cycle to determine where they can be more efficient.

Brands are increasingly emphasizing the need for analytics and business intelligence. According to a study by Accenture, 65 percent of aerospace and defense companies plan to use analytics to enhance program management, gain better visibility into product data and improve the usage of product information. The study went on to reveal that 42 percent are investing in configuration management.

By reducing configuration management complexity, companies hope to gain better data and insight into everything from supply chain to production. In turn, they can leverage that information to determine areas where they can trim inefficiencies, outsource or automate to develop a quicker and leaner process.

Design from the Bottom-Up

Caught in the rush to introduce new technology to market, OEMs often fall into the trap of creating a variance of a prior design without making sufficient alterations. A designer’s impulse is to copy and paste over the 80 percent that’s the same and then focus on the 20 percent that’s new. The problem with this approach is that any weaknesses or faults that existed in the original 80 percent will transfer into the new design.  

This means that if the original design included an obsolete component, then the updated design will also include that component; when you copy and paste it, you don’t solve the problem. Unfortunately, engineers tend to instinctively revert to what’s familiar. 

OEMs can avoid this problem by doing a bottom-up design. Before they start designing new circuits, they should find an industry partner to understand what option will provide the most stability in terms of cost and availability for the next 10 or 20 years.  

Invest in Additive Manufacturing

Across a multitude of industries, 3D printing is quickly becoming a popular option to accelerate production cycles. According to our survey, prototyping is currently the industry’s most popular application for additive manufacturing by a wide margin. 

With 3D printing, manufacturers can produce a functional prototype in a fraction of the time it would take using traditional methods. Furthermore, 83 percent of additive manufacturing stakeholders have discovered that additive can halve the time spent creating production parts or jigs, fixtures, according Jabil’s 2019 Additive Materials and 3D Printing survey. Additive manufacturing can also design components with complex internal structures, eliminating additional costs of labor and time to create and assemble various parts. The benefits are numerous

Make Partnerships a Priority

As previously mentioned, companies need to partner with suppliers and manufacturers that can provide quick and reliable data and visibility to ensure maximum efficiency across production lines and processes. However, there are other strategic partnerships to consider. 

When it comes to military applications, the FAA is not dramatically changing its regulations. Specifications for all the different products have been clear-cut and well-established for several years, and mechanical and electrical engineers know how to comply.

However, from an aerospace perspective, FAA regulations are more subject to change, especially as new technology enters the commercial space. One example of integrating aviation technology into the commercial sector in a new way is Amazon’s Prime Air initiative, which aims to deliver packages to consumers in 30 minutes or less by using unmanned aerial vehicles – drones. The FAA regulations for safety are changing rapidly, because they are unsure how to address this new phenomenon. Therefore, for companies that work with the commercial side of aviation, it may be advantageous to team up with a government regulatory agency to ensure compliance throughout development and possibly speed up the approval process. 

The capabilities of aerospace and defense are constantly growing, snowballing as technology continues to advance. Products are becoming more complex while product cycles are shortening, and with the surge in military investment, passenger travel and aerospace innovation, brands can feel the drive for accelerated innovation. By using these four strategies, manufacturers can keep pace with time-to-market and avoid being left behind.