Six strategies for defense contractors to compete locally and globally

February 21, 2017

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By Randy Starr and Anurag Garg

As growth in traditional defense markets slows, defense contractors must seek new channels by which to expand their businesses and find new customers. Rather than looking in familiar regions, growth for weapons manufacturers is being sought after in places like India, Saudi Arabia and Japan, resulting in landmark changes in the ways defense companies approach new business and manage their customer relationships.

As a result, defense contractors are increasingly needing to negotiate on a country-by-country basis and navigate a geopolitical maze ripe with unique histories, politics, alliances, threats, economic goals, and ways of awarding contracts. To thrive in this environment, they can no longer rely on a classic arms-length framework. Success will depend on the ability to build relationships, assess each market individually, decide which are appropriate to do business with, and design programs tailored to each country.

In PwC and Strategy&’s 2017 Aerospace & Defense Trends report, we outline six critical rules defense contractors should focus on when framing their approach to a diverse landscape of multiple local markets. Success and survival will depend on smart migration and a long-term blueprint. It’s a serious challenge that will cause contractors to wrestle with their own identities, but one a clear strategy can help surmount.

 

©2017 PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.  This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.

 

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