The Aerospace/Defense Industry serves, as its name represents, two main markets: Aerospace, which largely comprises the production, sale, and service of commercial aircraft. And Defense, which is dependent on the nation’s need for military weapons and systems designed to operate on the land, sea, and in the air. Also included in this industry is the production of general aircraft (mostly for business use) and space vehicles, usually satellites, for both military and commercial use.
The Aerospace and Defense Industry (A&D) comprises of manufacturers who develop spacecraft, commercial and military aircraft, tanks, missiles, and other weapon-related equipment. They also manufacture engines and engine parts as well as landing gears, propellers, and rotors. Other companies specialize in manufacturing armed vehicles. Firearms and accessories account for about 60% of the aerospace and defense industry revenue while ammunitions cover 40% of the total revenue.
The product line of the aerospace and defense sector is broad since its primary products and flight vehicles require up to millions of individual parts. Manufacturing in the aerospace and defense industry is unique compared to other volume manufacturing sectors. The uniqueness comes from aerospace engine manufacturing. The parts in the aerospace and defense sector require longer machining times. It increases the precision of designing the elements in the engine. The engine is the most complex element in the aerospace sector as it houses the most individual components and determines fuel efficiency. The components and material used in the aerospace and defense sector consist of short-run quantities, rendering scheduling for productivity, and long lead times as compared to other industries.
Program Management in Aerospace and Defense
Project – A specific investment having defined goals, objectives, requirements, life-cycle cost, a beginning, and an end
Programs and projects are managed based on a phased life cycle with key decision points (KDPs) where a program or projects status and readiness to proceed to the next phase are determined. This determination is supported by reviews through the life cycle and at KDPs and documented in evolving principal documents that govern the conduct of each phase and by the logical progression of four overarching processes: formulation, approval, implementation, and evaluation.
The Defense acquisition process is event-based and divided into 5 phases, 3 milestones, and reviews. There are three milestones:
• Milestone A—initiates technology development,
• Milestone B—initiates engineering and manufacturing development, and
• Milestone C—initiates production and deployment.
The purpose of the Materiel Solution Analysis or MSA phase is to select the most promising technology that can meet a user’s need.
The Technology Development phase is where technologies are developed, matured, and tested. To enter the program must have an approved AoA, full funding for the technology development phase, and pass Milestone A. To be considered mature enough for product development, technologies must be tested and demonstrated in a ‘relevant’—or preferably, ‘operational’—environment.
The Engineering and Manufacturing Development Phase is where a system is developed, all technologies and capabilities are fully integrated into a single system (full system integration), and preparations are made for manufacturing (including developing manufacturing processes, designing for mass production, and managing cost).
The Production and Deployment phase is where a system is produced and deployed. To enter this phase, a program, among other things, must have passed developmental testing and operational assessment demonstrated that it is interoperable with other relevant systems, can be supported operationally, shown that it is affordable, be fully funded, and pass Milestone C.
The Operations and Support (O&S) Phase is where a system is used and supported by users in the field. The main focus on this phase is the execution of a support system that sustains the system in the most cost-effective manner possible. The second main focus of this phase is the disposal of a system when it has reached its useful life.
Requirements Management. Establish clear, concise, verifiable, and valid requirements for processes, products, and components. Track and implement requirements using requirements management and configuration management control processes. Changes to requirements are documented and submitted to established program/project change request systems. Approved relief from complying with a requirement includes documenting the change as either a deviation or a waiver.
Project management principles
Requirements development is paramount to successful acquisition outcomes. Properly developed requirements enhance competition, ensure sound business strategies, provide the basis for realistic Government estimates, mitigate requirements creep, and help the Department to meet critical acquisition timelines. Systems Analysis of weapon system requirements projected by services may contribute immensely in reducing time and cost overruns by techniques such as feasibility, cost-effectiveness, and risk analyses.
The goal of requirements analysis is to determine the needs that make up a system to satisfy an overall need from the customer. It examines, evaluates, and translates needs into a set of functional and performance requirements that are the basis for the Functional Analysis and Allocation.
Programs and projects establish cost and schedule estimates and maintain control plans for program and project management (e.g., Program or Project Plan; Systems Engineering Management Plan (SEMP); Earned Value Management (EVM); Work Breakdown Structure (WBS); program/project technical, cost, and schedule baselines and risks).
Systems Engineering. Apply the systems engineering processes across the life cycle of products and components. Systems engineering is a methodical, disciplined approach for the design, realization, technical management, operations, and retirement of a system.
Risk. Formal processes are used for managing safety and mission success risk with clear accountability for risk acceptance by the responsible authoritative individual .
Technical Assessments and Analysis. Resolve high-risk technical issues through in-depth assessments, testing, and analysis.
Independent Reviews. Independent programmatic and technical reviews are conducted covering scope, cost, schedule, risks, or functional acceptability. Independent Verification and Validation – Verification and validation performed by an organization that is technically, managerially, and financially independent of the development organization
Industry Risks and Challenges
Managing projects in aerospace and defense involve dealing with many uncertainties: changes in the geopolitical situation, in particular, the Russia-Ukraine war and related challenges; consequences of the pandemic crisis; natural disasters; and even the application of technological innovations – these and other factors may lead to unpredictable events happening
The aerospace and defense industry is faced with the need to manage some of the most elaborate programs in existence. Programs that consist of over a million components and must be managed over a lifecycle of 50 years are not unusual.
Aerospace and defense companies are faced with several challenges such as difficulty in managing document-centric systems engineering processes, risks due to the integration of complex systems and supplier relationships, and compliance with regulatory requirements.
Complexity is further exacerbated by growing regulatory requirements. The need for controlled emission rates during manufacturing processes and the demand for more efficient engines and propulsion equipment are factors that must be considered when manufacturing equipment for the aerospace and defense industry.
Companies in the aerospace and defense industry must address the demands of customers located around the globe to deliver products faster at lower cost while maintaining mission-critical quality levels.
To manage these comprehensive programs, aerospace and defense companies have created global design and manufacturing teams consisting of suppliers, contractors and partners. But managing teams of contributors located around the world in many different organizations increases the scale of today’s program management challenges.
But along with new opportunities, these trends bring challenges too: e.g. a resource manager must keep track of a huge amount of data related to thousands of employees working on hundreds of projects from various corners of the world, let alone cultural and time zone differences and a lack of in-person interaction.
Many companies must also coordinate a virtual enterprise consisting of contributors from a number of different organizations such as suppliers and contractors often scattered around the world. Coordination and management of distributed resources requires additional efforts, otherwise, the efficiency of their work won’t be high.
In the defense sector, defense budgets around the world are many times under pressure as governments address declining tax revenues and competing national priorities. With less capital, it’s likely you’ll struggle to attain the resources, workforce, and skills required to complete projects on time and on budget. Even long-term contracts and related orders are subject to cancellation or delay if funds are not appropriated in future time periods.
As they attempt to manage these extensive programs, aerospace and defense companies also must confront escalating costs for capital, materials, services and employee compensation that are eroding the margins of most aerospace suppliers. In many cases, talent shortages can make the difference between hitting or missing contractual milestones and affect companies’ ability to continuously innovate and compete in the global economy.
Cybersecurity has quickly grown to become one of the greatest threats to business, and, for Aerospace organizations, is now of the utmost importance. From phishing attacks that try to obtain logins and passwords, to malware that can steal and corrupt valuable data, cyber-attacks come in many forms and can have a disastrous impact on the success of any project.
This challenging environment and its associated risks clearly demands program management excellence.
Project management trends in Defense and Aeropace
Aerospace and defense companies face increased product complexity, greater customization, and competitive disruption on a global basis. These challenges cannot be addressed by document-based and other inefficient methods still employed by many companies. It is imperative that companies conform to agile engineering and design thinking and processes.
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