It could be said that a close look at the aerospace and defense industry reveals a tale of two sectors. On one hand, commercial aviation continues to see strong demand and although the sector faces challenges around talent management, product development and sustained economic performance, it’s a bright spot in an otherwise modest economic recovery. On the other, after a decade of growth, defense contractors are confronting declining budgets and shifting priorities on the part of both the US government and other western nations. These changes have forced defense contractors to rethink their approach to many important business issues including pricing, supply chain management and productivity.
Survey results from this year’s Annual Global CEO Survey revealed that industrial manufacturing CEOs, which include aerospace and defense, began 2013 with less optimism than the year before. 80% of CEOs said they expected the global economy to stay the same or worsen. Now seven months in, the picture is clearer. Positive trends have taken hold and there is more optimism around bottom line growth. Still, businesses are staying proactive and efficiency has been identified as a way to keep ahead of market forces. Another, and one that’s discussed by several of the alumni interviewed in this issue of Keyword, is the need to implement effective strategies around innovation as a way to open new markets, improve affordability and reduce investment risk.
In this issue of Keyword we share an exclusive interview with Gary Spulak, president of Embraer Aircraft Holding, Inc. Now celebrating 30 years with the dynamic aircraft manufacturer, Spulak is piloting his company toward continued prosperity. Boeing, the world’s largest aircraft manufacturer, is also represented in Keyword through the important work of Kristen Gemeny. A human capital leader, Gemeny is implementing programs that will help Boeing find and retain top engineering talent. The CFOs of Raytheon Company, Sikorsky Aircraft Corporation and DRS Technologies offer readers an in depth look at the aerospace and defense industry from points of view that reflect the unique size and business priorities of each. Big data and information security continue to be hot topic for the defense industry. Jim Reagan and Drew Perez, two alumni making sense of bits and bytes, talk about the role data can play in creating a strategic advantage. And finally, we share what we believe are the eight key trends shaping the aerospace and defense industry.
What’s clear about the profiles you’ll read in Keyword is that no matter which way market forces are pushing at these companies, our alumni are up to the challenge. They are making today’s difficult decisions in order to position their businesses and their people for success in the future. Most exciting for me is that Keyword and our alumni are a great resource, continually adding to our understanding of business priorities and the global economy.
Robert E. Moritz
US Chairman and Senior Partner