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In the increasingly competitiveAerospace and Defense (A&D)manufacturing world, everyone is working to implement bestpractices. But not all best practices are equal. How do you decide which are just thetable stakes and which will giveyou a strategic advantage?

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ResourcesThe Aberdeen Group recently identified the top strategicactions and the top business pressures facing A&Dmanufacturers. The gathered information revealed thatthese issues impact all A&D manufacturers. It also revealedthat leaders have made different conscious decisionsthan followers, giving them a distinct advantage.

Unsurprisingly, the areas in which leaders are creatingthe most separation from the pack take the most work.While it’s all important, the extra work in the most difficultareas results in the most dramatic advantage.

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ACTIONS

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Standardize business processes to streamlineand accelerate processes.There might be and surely are areas rampant with government waste. But few industries have been moreaggressive at cutting out waste than A&D manufacturing.Those manufacturers that didn’t are gone, and thosethat are left fully understand that if they don’t continuouslystrive to improve both efficiency and productivity, theywill be next.

But it wasn’t easy. Standardizing business processes hasbeen a tough transition for many organizations, especiallythose that have viewed themselves as configure-, engineer- or made-to-order. However, looking criticallyat each step of existing processes usually identifiesareas that are nearly standardized or can be made sowith minimal effort. Making these changes has proven tobe extremely instrumental in the success of the leaders.

CUT, COPY AND STANDARDIZE

The easy cutting wins in A&D are gone. The push now is to standardize yourprocesses. This enables you to streamline operations and increase efficiency.

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Increase visibility to business processesacross functions and departments.Leaders have a jump on followers and are benefitting fromvisibility. This enables them to get beyond individualinternal silos and make strategic decisions using allavailable information. That’s good news. Organizationsthat haven’t made that move will want to quickly. Why?Two words: big data.

If you haven’t heard the term “big data” recently, youhaven’t been listening. It’s not news that our world is fullof information being created at an immeasurable rate.What is news is that companies are finding ways to usethat information—information from customers, suppliers,the manufacturing floor, everywhere—to make smarterdecisions in their bidding and estimating. Visibility intoyour own processes is great. Combining that visibilitywith visibility into the outside world through big datacan provide superior competitive advantage.

INCREASE VISION

The enemy in front or down the road—where to focus? The answer is both. Big data is the game-changer. Breakdown silos and leverage data to get a complete picture.

Reduce costs by increasing efficiency.Everyone feels pricing pressure, especially in A&D sinceeveryone competes for the shrinking pool of dollars andprojects. Companies that haven’t been able to clearlydefine and streamline processes are dropping out of the competition. At some point, those companies willbe gone. Everyone left will have strong processes andwill be efficient. Dealing with pricing pressures will relyon the accuracy of that company’s pricing information.The accurate bidding and estimating of projects and products─and the ability to do so faster than the competition─will be key in business success and profitability.

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PUSH BACK ON PRICING PRESSURE

Resources and components are commodities now. Accuratepricing is one area where you cancreate a profitable advantage.That requires an ability to leverage internal information.

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LINK GLOBAL OPERATIONS TO IMPROVED INTEROPERABILITY AND COLLABORATION.Leaders made the decision to standardize their processes earlierthan followers. The natural extension of that decision is to then go beyond the individual plants and leverage that knowledge among other facilities and then globally. It faces the reality of today:even if your customers are next door, you’re competing in a global marketplace. With that realization, they’ve made the strategic decision to be flexible and smart enough to leverage all of their assetsand information. It’s not easy. But the payoff in competitive advantage is huge.

LEADERS DO THIS

The Effective LeadersGuide: Four Critical Stepsto SuccessLearn the four steps leadersmust take to be effective catalysts of change. Learn More

Actively manage growth expectations.The A&D market has always been a familiar group.Today, trust is recognized as the new currency. Beingable to earn trust and keep it is critical for managinggrowth expectations. This requires an unprecedentedlevel of transparency compared to earlier times, but it’srequired today to ensure compliance, complete audittrails, etc. Strong processes, especially bidding and estimating, can provide a strong and trusted foundation.

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BUILD TRUST

Trust is the new currency. It is required today to ensure compliance, complete audittrails, etc. necessary in the market. Strong processes, especially bidding and estimating, create the foundation you need.

Address interoperability issues.Any organization with multiple operating locations hasfelt interoperability issues to some degree. Eliminatingsilos is its key to relieving the pressure. The combinedeffects of big data, cloud computing, the ability of pervasive computing, virtualization and SaaS applicationseliminate excuses for not being able to coordinatemultiple locations. In fact, multiple locations that are notcoordinated will quickly become a liability rather than anasset. They won’t provide the transparency, speed orcompetitive advantage that customers expect.

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PLAY WELL TOGETHER

Multiple operating locationscreate interoperability issues.Eliminating silos is the key toensuring that multiple locations remain an asset, not a liability.

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EASIER TO DO BUSINESS WITH.This is a brand-new concept to the A&D industry. For years, you received specifications that came from the Department of Defense(DoD). You built the product to those specs, delivered at the lowestcost and that was it, end of story. Today products are not only morecomplex, the time and quality expectations are dramatically higher.The competition is stiffer. The customer experience, even in the DoDenvironment, is growing more critical. Customers need answers andtrust through transparency. Ultimately it ties with many of the pointsmentioned previously, but the customer experience concept as awhole needs to be addressed strategically and from the customer’sperspective to remain competitive.

LEADERS DO THIS

What’s a key to ensuring profitability?Accept only the most profitable andachievable orders. Take a critical lookdeal by deal over time. Smaller dealsexecuted with greater precision coulddrive the most profit.

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IDENTIFYPROFITABLE ORDERS

More smaller projects,more profitable

Fewer larger projects,less profitable

Determine actual profitabilityby breaking down profitabilityin terms of:• Time-based cost• Cost of materials• Opportunity cost

of other areas

18% 30%Gross Profit per Project

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GOINGFORWARD

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Every industry faces strategic challenges and pressures, andthe ones facing the A&D industry are unique. Many are newdue to changes in the market and are complicated furtherby the recent and dramatic changes in technology. Thishas weeded out many of the less-strategic companies;the remaining contenders will have to be diligent in theirefforts to remain competitive. Implanting best practicesin processes is a requirement. Right now, the leaders arefocusing on strategic decisions to build their advantage,and they will continue to increase their lead.

Manufacturing Industry TrendsLearn how other manufacturersare using technology to simplify processes, and create advantage.Learn More

Manufacturing Matters Get the latest news andthinking about manufacturingand selling complex productsand services.Learn More

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Cincom recognizes that it is your people—your customer-facing employees—who represent yourbrand. And in each interaction, it is the experiencethat they deliver to your customers that either buildsvalue for your brand or destroys it. It is a powerful role toplay. Since 1968, Cincom has helped thousands of clientsworldwide by solving complex business problems withits software and services.

Strength in ManufacturingCincom Total Manufacturingencompasses more than 44 years of manufacturing expertise. Results customershave achieved include doubling manufacturing volume and cutting turnaround times by 50%.Customer Stories

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