Four key factors that will change the way defense organizations operate and bring huge changes to military support chains.
In 2016, I believe we will start to see the growth of new and demanding military ecosystems develop in the defense market. These ecosystems will be driven by the growth of multiple relationships between contractors and manufacturers which will inevitably mean more complex contractual agreements and varying levels of capabilities. The result will be more protected military ecosystems and a more concentrated defense manufacturing market – because the more protected ecosystems there are, the more competitive it will be for tier two manufacturers to play their role as suppliers.
Below, I outline the four key factors that will change the way defense organizations operate and bring huge changes to military support chains:
1. The Internet of Things & 3D Printing
Connected devices are now playing a big role in maintenance hangars. An example of this is the F-35 jet, which has sensors that send real-time data to a ground-based logistics support solution. Hours can be saved in the maintenance bay by making sure engineers are prepared for the task at hand and are ready with the right part as soon as the aircraft lands.
The advantages of being able to produce parts in-theater, on what is now increasingly mobile 3D printing technology, are huge. The US Navy has started to adopt 3D printing technology on board the USS Essex to produce custom drones to greatly improve intelligence and decrease the risk of danger.
The use of 3D printing to produce parts when they are needed, so that organizations can keep control of their support chains by controlling distribution and quality of parts, has potential advantages for military ecosystems. However, a word of warning here – the introduction of 3D printing has the potential to disrupt military ecosystems.
Can defense manufacturers safely adopt 3D printing technology with the increasing threat of counterfeit parts? Organizations will need an enterprise approach for the management of underlying software support solutions if the transition to an effective and safe environment is to be achieved.
2. Protected ecosystems create big opportunities for T2 manufacturers
I think tier two manufacturers can find huge opportunity in the emergence of protected ecosystems. When you consider manufacturing and procurement cover just 20% of the total costs associated with modern fast jets, the remaining 80% of costs being is spent through-life on in-service support. If we look at a typical defense manufacturer, it might have a profit margin of just 7%, and can only realize revenue benefits from through-life costs.
Tier Two manufacturers have an excellent opportunity here to provide effective maintenance and operational support to help produce significant cost savings at a time of changing defense budgets – but only if they can minimize the risk they currently present to T1s. A significant part of this will be the need to adopt agile software solutions that are able to adapt to the business transformation.
3. 360-degree view of all defense operations
With increased industry involvement and new technology in the support chain, defense organizations will need better control and visibility over increasingly fragmented logistics operations and services. A full 360-degree view of defense operations is needed if organizations are to become fully protected and better informed military ecosystems.
Defense departments will also have to continue to become more business-like in the way they operate – balancing value for money with operational effectiveness and safety. Our own Enterprise Operational Intelligence, part of IFS applications, has been developed to help defense organizations do just this by allowing them to map, monitor and manage the entire support chain or defense enterprise.
4. 6th generation logistical support
My prediction is that the future will see a 6th generation of logistical solutions which will be characterized by three main factors:
- The soldier, their equipment and the fully integrated support chain will allow for an increased agile response to changing tactical situations
- Real-time optimizations – E2E but as the ‘Logistics Support Enterprise’ or ecosystem
- Less Military/Industry IS solution islands – moving towards solutions where data is contractually shared across project/platform and encompassing a joint strategy rather than point KPI performance
The driving theme and IFS belief are that we should consider the soldier out in the field in all these predictions. These new developments need to ensure that the soldier in the field has access to the right information, in the right format at the right time – enabling them to execute their task effectively.
