Simulation & Analysis Investments:
Business Drivers in Aerospace & Defense
Ora Research Letter on Digital Prototyping, Simulation & Analysis June 15, 2009
By Bruce Jenkins, CEO
Aerospace and defense manufacturers are among the industrial world’s most advanced and sophisticated users of digital simulation and analysis. Why? What drives investment in these tools, and in the methods and work processes around them?
Chief is that products of today’s complexity, performance and efficiency simply can’t be developed any other way:
“…we have to [use simulation] to meet our goals. We simply couldn’t design our products without doing modeling and simulation…” – Aerospace/defense company A
Developing a new aerospace product or defense system is a massively complex undertaking that can cost hundreds of millions if not billions of dollars, and can span a decade or more. By making it possible to meet program objectives on time and within budget, simulation and analysis confer competitive advantage out of all proportion to their direct cost.
Commercial aviation business crisis In commercial aviation, major airlines are struggling with high fuel and other operating costs, competition from low-cost carriers, and travel volumes affected by the economic downturn. With all this, airlines are seeking more flexible, cost-efficient aircraft that are cheaper to operate and maintain:
“…How can I assure myself the aircraft can meet range requirements without refueling? You have to use simulation to do that. In our industry we can't throw something together with limited simulation and then fly it to find out…” – Aerospace/defense company B
Another critical driver of simulation and analysis usage is the nature of aircraft industry sales cycles – order-taking begins long before the first prototype flies:
“Our marketing department frequently goes into customer meetings with answers based on modeling and simulation. When they have discussions about new aircraft we haven’t built yet, the information in their sales pitches has to be derived from simulation.” – Aerospace/defense company A
Major aircraft manufacturers also face growing competition from regional jet makers now developing larger and more capable planes. As a result, these companies face unprecedented challenges to deliver products that are more efficient, better performing, higher quality, better differentiated and more appealing to the flying public – all while keeping development and production costs under control:
“One thing that had been holding us back [from making more advanced use of simulation] is that we are a very big company that has been very successful for a long time, and that creates inertia that can make it difficult to do things in new and better ways. But now, one thing proving remarkably effective [in driving adoption of new simulation tools and methods] is losing market share. That’s doing as much as anything else to help us crack through some of this resistance – there’s increasing awareness that we can’t keep doing things the 1955 way and expect to be successful.” – Aerospace/defense company A
Defense systems: unprecedented complexity, capability, reliability demands In defense markets, the U.S. Department of Defense – which accounts for almost half the world’s aggregate defense budget – is focusing on long-range strike capability, unmanned air combat and reconnaissance vehicles, precision guided weapons, joint operations, interoperability among weapons systems, and better integrated capabilities for the various branches of the armed forces. All this means defense contractors are having to cope with unprecedented complexity, capability and reliability requirements:
“…[one of our aircraft models has] been in production for nearly 25 years. In its infancy in the 1970s, it was a much less complicated product. The amount of simulation required was minimal compared with today, where many complex subsystems are interoperating and multiple sensors are collecting loads of information. You have to rely on simulation tools to validate performance. We’re constantly pushing the edge of the envelope in simulating physics…” – Aerospace/defense company B
In addition to this increased product complexity, what it takes to win business has also gotten more demanding:
“We begin by asking: what is mission success for our customer? We’re heavily involved in how we’re going to assure mission success for our military customers – how can we get even better at that? A big thrust for us is getting closer to our customer, getting into the ‘soft spaces’ [of up-front requirements definition]. They write a requirement, but what problems are they really trying to solve? Maybe we can help them with tradeoffs. Getting closer to the customer is key – getting into their up-front design space to understand their real needs.
“As you move up that food chain – as you start to ask where the leverage is – simulation and modeling become increasingly significant… We’ve created a [group dedicated to] the pre-contract award period, even before a proposal is put out. [That group is focusing] on using modeling and simulation as a huge lever to leapfrog us forward, by helping us get into that up-front pre-award space with the customer.” – Aerospace/defense company D
Space systems: cost and schedule overruns, mission failures An urgent, newly identified need is to alleviate perennial – and worsening – cost and schedule overruns in space-systems programs:
“The chief problem that has affected both the defense space community and the civil space program is that a quarter of all space flight electro-optical sensor programs are overrunning their schedule and budget allocations by 100% or more. At the same time, there have been increases in mission-critical failures with these payloads. Of course the systems themselves are becoming much more complex, but nevertheless these resource overruns are coming to be seen as unacceptable. Programs typically have a 20% overrun contingency; that is what is seen as acceptable. So [100% overruns mean] the industry has a factor-of-five problem today.
“Several recent studies, such as the NASA Instrument Capability Study, have explored a number of underlying causes for these large overruns. One of the clearest conclusions, cited by a task force headed by Thomas Young, is the need to focus on reliability from beginning to end during flight program execution – that is, to perform simulation and test at each stage of development in order to catch problems at their earliest possible stage when they are far cheaper and quicker to fix.” – Aerospace/defense company E
Global project execution In all sectors of aerospace/defense, project execution has gone global:
“In the past, [products were developed mostly] inside a single company, versus the global participation common today – that in itself is a challenge.” – Aerospace/defense company F
This has spurred the search for ways to virtualize the various product development and validation workflows that, for most of the industry’s history, were carried out by physically co-located teams:
“...our PDM system is much more than CAD data management. It's a portal into our entire product development virtual environment. It enables collaboration across our design facilities around the world…it includes a lot of the data that is an input to simulation as well as the simulation results...” – Aerospace/defense company B
Flight certification A perennial driver of technology investments in aerospace and defense is the requirement to certify products for flightworthiness. While physical test remains the predominant method, analysis results are increasingly provided and accepted as part of the certification process, perhaps most notably in aircraft propulsion systems.
In-service support Finally, both commercial and defense aircraft manufacturers are among the many industrial firms looking to in-service support and sustainment of their products as increasingly vital revenue and profit centers. On average, after-sales services and parts typically yield 25% of revenues and nearly 50% of profits for industrial companies, according to a study by Accenture Ltd. recently cited in The Wall Street Journal. In addition to aiding urgent diagnosis of unanticipated performance problems as well as routine MRO (maintenance, repair and overhaul), ownership of simulation and analysis results can also help manufacturers fend off competition from third-party after-market service providers.
Next time Assessing the current state of industry practice in aerospace and defense: Simulation used early and pervasively today; next challenge – “bring fidelity forward.”
This research is excerpted from our white paper Strengthening Simulation's Business Impact: New Strategies in Aerospace & Defense. In this project we interviewed discipline leads and methods experts at major aerospace and defense OEMs and subcontractors around the world. Our investigation focused on business drivers for sustaining or increasing simulation investments, current state of industry practice, constraints on maximizing simulation’s value, and new strategies for overcoming these constraints. Request your copy of the white paper | 
