Aerospace and defence organisations are experiencing a number of supply chain challenges brought about by the COVID-19 pandemic. But PA Consulting argues restoring operations alone won’t cut it
With the world changing and budgets set to be considerably impacted over the coming years, leaders must rethink and redesign existing approaches to go beyond short-term recovery and set a long-term strategic supply chain vision.
With 90 per cent of the world living under travel restrictions, we’ve seen an unprecedented drop in demand across aerospace. And while defence funding continues for now, it’s likely to be impacted as governments grapple with rapidly rising deficits.
Navigating these challenges will be tricky – but there is a way forward. It calls for short-term action to restore operations while setting out of a long-term strategic vision for future success. It requires a resolve to find the opportunities in complexity. And it calls for three specific actions:
Restore – repair operations
With significant disruption to manufacturing operations, including production lines being altered and reconfigured to manufacture essentials and produce medical supplies, it’s essential to begin by evaluating the impact of the crisis with a two-step approach.
Understanding your cash position is key. First, we recommend having a supply chain data control tower to provide a single source of truth of costs across sales, operations and cost management. Second, you’ll need to integrate insight from both customers and suppliers into your forecasts, ensuring collaboration across all functional domains and incorporating output from scenario planning.
These steps will enable you to define and implement an action plan to restore operations that balances demand, supply and production capacity with a close eye on cost control.
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