The aerospace and defense (A&D) industry has shown signs of a strong rebound in 2022, but supply chain and talent issues continue to limit the industry’s growth in 2023. According to Deloitte’s outlook survey, supply chain disruptions and talent shortages may be the biggest ricks or challenges for A&D organizations in 2023. Inflation also remains a challenge for the entire industry–54% of respondents in Deloittes’ survey report that price increases are one of the key risks this year.
The defense segment remained stable through 2022 and is expected to outperform the commercial aerospace segment as in increase in defense budgets in the wake of Russia’s invasion of Ukraine is boosting demand for military equipment globally. The US defense budget for FY2023 emphasizes perceived strategic threats from China and Russia, with a key focus on electronic warfare and cybersecurity. The president’s request of $872B represents more than an 8% increase.
According to Deloitte’s outlook survey, 88% of surveyed senior executives indicated that they believe the general business outlook for the A&D industry for the next year is “somewhat to very positive.”
2023 Aerospace & Defense Industry Trends to watch
Focus on supply chain visibility and resilience mitigates broader set of risks
Companies across the defense sector have been forced to learn more details about their supply chains, and where the vulnerabilities and risks are. In order for companies to quickly adjust to sudden disruptive changes, they’ll need a few important tenets:
Rapid detection, response, and recovery
End-to-end, data-driven, supply change control that allows a company to view raw materials, semi-finished goods and finished products starting from the “suppliers suppliers” to the “customers’ customers”. And it will be important to prepare for these disruptions before they happen via scenario planning and war gaming.
Emergency stockpiles, safety stocks, and diversified sourcing from offshored, nearshored and/or reshored suppliers
Collaboration of private and public supply chain stakeholders
Companies will likely emphasize supply chain diversification, including local sourcing and nearshoring, to avoid concentration risk. They’re also likely to build relationships with suppliers from countries with free trade agreements (FTAs).
Moreover, companies will need to reinforce the need for cybersecurity, cloud privacy, and the resilience of the systems and automation to be prepared effectively for ask risks with core operations and with key suppliers.
Acceleration of digital thread and smart factory can drive improved efficiencies
Smart factories are built on Industry 4.0 technologies that combine cyber digital and physical systems. And they can bring even greater value when they are connected through the digital thread – a single, seamless strand of data stretching from the initial design of a product through to its operation. It connects engineering, supply chain, manufacturing and aftermarket touchpoints.
A good starting point is to connect the PLM, ERP/MES and asset management toolsets. The continuous flow of data between these systems forms a body of knowledge that will help maximize quality, efficiency and compliance.
It can drive unprecedented value:
Designing with 360-view of product lifecycle
Differentiating products with increased flexibility and improved quality
Driving manufacturing efficiency by connecting disparate systems
Identifying new ways to deliver service
Enriching the sales and marketing experience
A new federal initiative, AM Forward, is a voluntary compact among large manufacturers to help their smaller suppliers increase their use of additive manufacturing or 3D printing. Investments like this could help drive supply chain resilience and reduce lead times.
Attracting, retaining, and developing top talent remains a challenge
While the majority of jobs losses related to COVID-19 have been added back, the workforce turnover rate remains high, and an aging workforce is contributing to the current shortage. Meanwhile, automation and advanced digital technologies are driving the need for a workforce with more advanced aerospace engineering, math, data science and digital skills.
According to the Deloitte outlook survey, three out of five senior industry executives surveyed believe that offering clearer pathways for career progression is the best strategy to attract, retain, and develop top talent.
Lowering emissions and implementing sustainable manufacturing remain business priorities
According to the International Data Corporation, 80% of global manufacturers will incorporate environmental sustainability in their products by 2024, which can improve sales by 3%. Sustainability has already become an integral part of business decision marking as both consumers and corporate purchasers increasingly consider carbon footprints when making buying and investment decisions.
A&D primes set a target to reduce greenhouse gas (GHG) emissions, water, waste, and energy and are progressing toward meeting their 2025 and 2030 sustainability targets. For instance, major A&D primes have set a target to reduce more than 50% of GHG emissions by 2030.
In addition to the well-established steps (such as switching to alternative energy sources or improving energy efficiency), a much larger variety of emissions-reducing innovations is now available, including low- or zero-carbon raw materials, greener product designs, and improved overall product usage that strengthens the circular economy.
Innovation accelerates growth in emerging areas
Emerging markets such as space, supersonics/hypersonics, and AAM are poised to change the industry landscape and capabilities in the coming years. 2023 will likely be an important year for these emerging markets in terms of investments, technology evolution, and regulation. According to Deloitte’s outlook survey, organizations are most likely to invest in space-related technologies and AAM in 2023.
2023 could see further developments in earth observation/remote sensing, satellite communications, and technology development. As industries are combating climate change, space companies can monitor and track Earth and benefit manufacturers with advanced technologies such as IoT to improve productivity and reduce emissions.
Customer service is a rapidly evolving discipline that plays a major role in the a company’s long-term success. And in honor of National Customer Service Week 2021, we’re highlighting what A&J is specifically doing to ensure that our happy customers continue to do business with us.
How Has Customer Service Changed in the Past 10 Years?
As business models change, so does customer service. And undoubtedly with the proliferation of the internet, customer journeys have become more complex.
According to Accenture, 61% of all B2B journeys start on the internet.
McKinsey & Company estimates that improvements in customer experience can lead to a 10% to 15% reduction in customer churn, 20% to 40% increase in win rates of offers, and 50% lower costs to serve. On average, B2B companies’ typical customer experience scores fall below 50%! We absolutely want to be an exception to that!
More than one in four buyers anticipate that automation is going to change the B2B buying role in the next 5 years.
Your #1 Priority: Speed
Time is your greatest resource. And we realize that offering a fast and efficient B2B customer journey is what can help elevate your experience with us.
One of first priorities is freeing up our team’s time to focus on quick responses. We want them to respond quickly, as well as engaging in meaningful, relationship-building interactions. Our current first response time is 1 business day to all standard quote requests.
We’ve invested in an ERP system to connect all of our relevant systems. The right software has helped us automate manual processes, manage customer interactions, collect feedback and use time and resources efficiently. But, there’s always still work to be done to ensure that our tech stack is well synchronized to deliver a fast and streamlined customer experience.
Your #2 & #3 Priority: Ease & Consistency
In an effort to remove friction from our buying process, we’ve spent the past year improving the usability of our website. While you can’t directly place orders on our site, we’ve taken significant steps to organize and build a knowledgebase so that each customer can better understand the racks and kits/accessories that we have available. We’ve answered your most frequently asked questions into a customer-facing webpage and will continue creating and adding helpful documentation in a centralized hub. The goal is to continue to grow this into whitepapers, infographics, videos, eBooks and other resources. If you discover that we’re lacking in information or you don’t see a topic covered, please don’t hesitate to let us know!
We also realize that it’s common for you to use multiple channels and have several different stakeholders involved at each stage of the buying process, so we’ve done the work to keep the same message consistent across our website, on the phone or via email. All interactions with our employees and staff should be seamless.
Your #4 Priority: Transparency
Whatever channel you use, we always strive for transparency. Not only do we want to set the right expectations and ensure no nasty surprises, but we want to build trust. In addition to being responsive, we commit to the following:
Communicating the correct pricing, order calculations and shipping terms from the beginning. All quotes provided will be honored for 90 days before expiration.
Acknowledging mistakes
Providing access to order statuses and other changing information in near real-time
We’re proud to announce that our CEO & President, Barry Lyerly, is featured in the January 2021 issue of the Aerospace & Defense Review magazine and that we’ve been recognized as one of the Top Defense Manufacturing Solution Providers for 2021.
To ensure the high product quality that we’ve maintained over the years, we’ve moved into a larger facility and installed a new ERP system to integrate throughout the company’s manufacturing, accounting, parts and inventories. To further attest to our quality offerings, we’ve recently obtained the AS9100D and ISO 9001:2015 certifications. To this end, we’ve also invested in a Hexagon Absolution 8525-7 CMM to ensure all our parts stay within certain specifications. And not be left behind on the security end, we’re working with cloud security specialist Port53 to get the Cybersecurity Maturity Model Certification (CMMC).
Aerospace & Defense Review is a peer-to-peer knowledge platform bringing news, trends, as well as insider views and analysis of current business and technology issues affecting the industry.
A&J Manufacturing Company To Celebrate the U.S. Navy’s Newest Amphibious Warship
A&J Manufacturing Company participated in the construction of USS John P. Murtha (LPD 26), the U.S.Navy’s newest San Antonio-class amphibious warship which will be commissioned in Philadelphia, Pennsylvania on Saturday, October 8.
Our company, A&J Manufacturing which employs over 30 individuals in Tustin, CA, contributed Electronic Enclosure Cabinets and Sliding Shelves to the U.S. Navy’s newest amphibious warship, USS John P. Murtha (LPD 26).
A&J is very excited to celebrate the commissioning of USS John P. Murtha on October 8 in Philadelphia, Pennsylvania.
Currently, there are only 30 amphibious warships in the U.S. Navy – eight ships below the stated U.S. Marine Corps minimum requirement – and almost a third of these are unavailable due to much-needed maintenance. Therefore, to ensure future amphibious requirements are sustained, it is critical to maintain the hot production line between the building of amphibious warships – particularly between the currently under-construction LPD 28 and the first of the next generation of amphibious warships, LX(R).
“I think the nation often overlooks the valuable technological skills and expertise of our workers and engineers required to build these massive and complex ships for the country’s defense,” states Brian Schires, Vice President of Naval Marine Programs, Rolls-Royce North America Inc. Rolls-Royce Marine North America built the propellers aboard USS John P. Murtha (LPD 26).
PANAMA CITY, Fla., 26 Feb 2013. U.S. Navy shipboard electronics experts will look to A & J Manufacturing Co. in Tustin, Calif., to provide mil-spec electronic enclosures and related equipment for the Multiple Vehicle Communications Systems (MVCS) on two new littoral combat ships (LCS).
Officials of the Naval Surface Warfare Center Panama City Division, Panama City, Fla., have announced their intention to award a sole-source order to A & J Manufacturing for MVCS enclosures and electronic products for the littoral combat ships USS Montgomery (LCS 8) and the USS Little Rock (LCS 9).
A & J, a rack and electronics manufacturing specialist, will build four MVCS electro-magnetic interference (EMI)-resistant electronic enclosures for the Montgomery, and eight MVCS EMI-resistant electronic enclosures for the Little Rock. The amount of the order has yet to be negotiated.
The MVCS is for communications between the LCS surface ship and different mission packages involving mine countermeasures, anti-submarine warfare, and surface warfare.
The MVCS supports communications between the surface mother ship and mission package vehicles that are part of the Remote Multi-Mission Vehicle (RMMV) unmanned vehicle, and the LCS’s Unmanned Influence Sweep System (UISS), which provides stand-off, long-endurance, semi-autonomous minesweeping capability to counter acoustic and magnetic influence sea mines in shallow waters along coasts and harbors.
The Montgomery will be an Independence-class LCS, and the Little Rock is to be a Freedom-class LCS. The Montgomery is under construction by Austral USA in Mobile, Ala.; and the Little Rock is under construction by Marinette Marine Corp. in Marinette, Wis.
In addition to the four EMI-resistant electronic enclosures A & J will build for the Montgomery, A & J also will provide two 2U electronic drawers, 10 cable retractors, 12 mounting brackets, seven slide plate assemblies, four power panels, as well as nuts as gasketing.
In addition to the eight EMI-resistant electronic enclosures that A & J will build for the Little Rock, A & J will provide four 2U drawers, 20 cable retractors, 24 mounting brackets, 14 slide plate assemblies, 10 power panels, as well as nuts and gasketing.
The Navy is awarding a sole-source contract to A & J because the company is the only provider of these kinds of systems that are based on government testing results, meet the necessary commercial and military band certifications and weight restrictions, Navy officials say.
Currently, no other source meets the certification requirements for interoperability with the MVCS, officials say.
