The UK may have the world’s second largest aerospace and defence industry but it is facing some of the toughest challenges in its history at the present time. Cyber-security threats, Brexit and manufacturing challenges related to the hazardous environments its products are used in are three major obstacles to growth.
Yet help in overcoming these may be much closer to hand than defence OEMs (Original Equipment Manufacturers) imagine.
Here’s how partnering with the right manufacturing partner can help OEMs rise above the biggest challenges they face.
Data and cyber-security challenges
All UK manufacturers are under threat from professional cybercrime gangs looking to access intellectual property, but it is defence manufacturers that are the main target for hostile nation state actors.
Such hackers typically work on behalf of a government to disrupt or compromise defence OEMs. Their ultimate goal is to try and access classified information about military technology.
Nation state threats are thought to only make up about 10 percent of all cyber-attacks worldwide. Their impact, however, is disproportionately large: they are the hardest attacks to resolve and the trickiest to detect, and they are increasingly causing more and more disruption. SecureWorks research suggests it is taking five times longer to fully evict a nation state attacker from a network every year.
The Bronze Union is the nickname given to one such group of hackers. They are believed to operate for the Chinese government and, in recent years, they have made several high-profile attacks on defence manufacturers. One infiltration technique they use is a Strategic Web Compromise (SWC) – a targeted attack which infects websites that employers visit and lures them to access a malicious site.
Yet, attacks are not always as direct as this. Such groups are adept at locating and exploiting vulnerabilities and weaknesses in the OEM’s supply chain as well as its employee’s browsing habits. The notoriously aggressive NotPetya attack used trojanised updates via widely-used software to infect the PCs of organisations across the world, but particularly in Ukraine. The perpetrators are believed to have been working on behalf of the Russian government.
Never has it been more important for defence OEMs to partner with EMS providers who take the inherent risks of security threats with the same rigour as themselves. As we move into the full-scale implementation of Industry 4.0 new entry points can be exploited in IoT devices themselves as well as through the sheer volume of data that is being stored in the cloud. With so many sensors and data collection points now being installed within military devices and products there is now another layer of risk potentially embedded in each device that is shipped into service.
Brexit and funding challenges
Not every threat facing the defence OEMs is a veiled one issued from the other side of the world. Perhaps the biggest challenge today is emerging from sources closer to home. The disruption to established trade relationships that Brexit may bring about has the potential to cause more severe losses than even a major malware incident. With more than half of its turnover realised through export, any losses from the UK defence sector’s overseas market will have resounding repercussions.
The UK’s standing and relationship with European Aviation Safety Agency (EASA) and the European Open Skies regime (ECAA) are still under question. If not quickly resolved, these could deliver a serious blow to the industry.
A further risk is the loss of EU grants and funding sources that the UK defence sector has enjoyed. These include $500 million each year that is potentially available from EU Defence Research and Development grants and EU space research funding, which is valued at around $15 billion over the next few years.
The possible disruption to the UK’s role as a part in the EU supply chain could wreak as much havoc as the loss of funding – and, given the UK’s persistent shortage of engineers, any barriers to the movement of people would have a similar negative effect to the movement of goods.
The way that Brexit will pan out is notoriously hard to predict – but it is clear that now is the time for OEMs to look to consolidate their supply chains to ensure they are operating at maximum efficiency.
And being highly selective in choosing EMS suppliers to partner with will play a significant part in achieving this.
Hazardous environments and manufacturing challenges
The most immediate way that contract manufacturers can support defence OEMs through the challenges that face them has nothing to do with politics or crime. Increasingly there are complex manufacturing requirements that must be met by electrical components used in defence products. An ongoing challenge facing OEMs relates to the environment their products will be used in.
Electrical components used in situations involving explosive atmospheres or flight require a number of extra measures to ensure they are robust enough to survive. In such conditions, adhering to Intrinsically Safe standards is vital, and something that the EMS partners chosen must be highly skilled and experienced in.
With any manufacturing process, it’s essential to keep comprehensive records, and this is particularly critical when it comes to developing products for the defence industry. As so many complex conditions and procedures are involved, every step in the manufacturing process must be accounted for, with the correct documentation and certification where required.
Only an EMS partner with a sophisticated data network can monitor and track this – and tracking this is just as critical to a successful product launch as the manufacturing process itself.
Working with a trusted and experienced EMS partner can reduce many of the security, efficiency and manufacturing risks that defence OEMs face.
Yet, the industry will also require more than a robust and well-managed supply chain and highly-qualified manufacturing partners.
Defence is far from an open market and the success of the UK’s defence industry is closely associated with the level of government support it receives. Whatever the effects of Brexit may be, economic diplomacy that embraces military sales, must be seen by the UK government as a strategic policy tool to win the hearts and minds of friendly foreign states.