Articles

Changing Dynamics of Defense Industry, A global panorama

Defense Industry is one of the niche segments in the global industrial scenario. Unlike the other industries, where the demand for the products or services depend upon the consumer buying behavior, changing lifestyle trends, competitive product development and other factors, In this Industry the encounter is all about Economic scenario of the nations, global political conditions, battle ground strategies, attacks and counter attack scenarios, and such clustered environment which decides the game dynamics in the Industry.

Recent studies from global market research firms, estimate that the Global Defense Industries might envisage a slowdown in the growth rate and the companies might have to work on their contingency plans, alter the production schedule etc., in order to realign themselves to the ongoing market conditions.

In lieu of all the above mentioned, should we attribute that Defense Industry is more prone to impact of socio and political conditions of developed and developing countries. If so what are the soft and hard corners which spur or doom the business of the Defense Industries.

The major crux for the industry is the kind of the complexity which is growing rapidly in the market, the government regulations towards the industry and the stake holder’s expectations, and the prevailing economic slowdown in many countries.

The global defense industry is encountering the challenge of ensuring profitability whilst of meeting the pressing demands of the market conditions. The kind of slow down from the governments towards military spending has hampered the growth factor, globally for defense companies. Eventually this is leading to not much of R&D factors in the defense companies, towards design and engineering. Addressing the demands of government regulations, export policies, regulations on arms development will be the key to success of defense industries during this slow down.

The other dimension of action in this slow down, is what can be perceived as time for R&D, For all known reasons, now the companies are not gaining much action in the market front, the team can focus on the futuristic needs of the market, work on developing new systems and designs which can leverage the market potential to their benefit during the market revivals.

Focus in the industry should be on building new facilities, develop the infrastructure to meet production demands of the future, enhancing quality standards of production and delivery. Creating new processes to cut down operating and manufacturing costs is also a pressing need for these companies to sustain the slowdown in the global market conditions.

It’s the time that the industry has drive by the stakeholder’s engagement model, and with a strategic approach to prepare for the future market to achieve their organizational objectives.