Industry
Manufacturing
Future-Ready Manufacturing: Partnering in your journey to a sustainable manufacturing enterprise
Highlights
- Aerospace supply chains are facing a welcome challenge: demand has recovered strongly, but keeping up with it remains difficult. However, disruptions like geopolitical tensions, tariff uncertainty, and material shortages necessitate urgent improvements in the visibility, agility, and coordination across all tiers of the aerospace supply chain.
- Building resilient supply chains will require a mix of strategic measures such as multi-sourcing, nearshoring, stockpiling, talent development, and stress testing, combined with the adoption of new technologies such as artificial intelligence (AI), digital twins, Industrial IoT, and advanced control towers.
- We propose a phased roadmap to fortify the aerospace supply chain by improving the critical aspects of people, processes, data, and technology.
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The current state of affairs
Things are looking up for the aerospace industry as it experiences a robust resurgence.
Commercial aviation has nearly returned to the pre-pandemic (COVID-19) operational levels and is projected to grow 5%-10% annually over the next couple of years. This recovery, however, has not translated into operational stability.
Original equipment manufacturers (OEMs) as well as their suppliers, regularly report challenges to deliver on order backlogs owing to a shortage of materials, key electronic components, and skilled workforce. One of the leading aerospace manufacturers reported strong Q1’25 financials but had downgraded their annual guidance mid-year in part due to supply chain issues and tariff related uncertainties likely had a role in the 20% decline in aircraft deliveries in the month of April 2025 compared to the previous month. This highlights the complexities of today’s supply chains where any disruption is at, say a tier-3 supplier of a high-pressure turbine blade, will send ripples all the way to the top.
In addition, geopolitical developments such as looming tariffs, Russia-Ukraine conflict, unrest in the Middle East, and US-China relations are pushing companies to constantly rethink and realign their supply chains.
The future-readiness of the aerospace industry is going to heavily rely on building resilient, adaptable, and robust supply chains that can withstand disruptions and use new-age technologies for the immense advantages they offer.
Potential risks and shocks to prepare for
Aerospace supply chains face a variety of systemic as well as localized risks, many of which are intensifying.
These risks can be classified into six broad areas:
- Supply-side risks, which include shortages, delays, and quality issues
- Operational risks, which include production issues such as safety incidents, unplanned shutdowns, strikes, labor shortages
- Cyber risks apply to an organization’s own or extended supplier networks and come in the form of IP theft, ransomware, data integrity
- Economic risks, which include tariffs, regulatory changes, bankruptcies
- Geopolitical risks, such as military conflicts, sanctions, political instability
- Environmental risks, which include weather events, pandemics and sustainability requirements
Let’s examine each of these factors and the impact they have on the aerospace supply chain in detail.
Supply-side risks are systemic in nature and affect the industry at large given the strong reliance on specialized raw materials such as nickel, titanium, and tantalum, and other composites like carbon and glass fibers. Apart from raw materials, there are other finished goods such as castings and forgings, semiconductors, and electronic components.
Airbus suffered to meet production targets when Safran, LEAP engine manufacturer, faced delivery issues. Safran acknowledged production issues at Howmet, impacting the supply of turbine blades. This highlights the Supply chain vulnerability in aerospace where disruptions at a single supplier can impact multiple players.
The supply chain for such materials runs deep, suffers from opacity, and is controlled by a select few, making it vital to identify bottlenecks and potential shocks which can disrupt production.
Operational risks are more localized and specific to an organization. They are significant nonetheless and can cause considerable financial and reputational damage. Boeing is a prime example where a company known for its innovation and pioneering products suffered immense damage to its reputation due to oversight on safety and quality control.
Organizations need to be keenly aware of their dependence on technology and manual intervention – these range far and wide including system malfunctions, obsolescence, delayed detection, and even facility incidents.
Cyber risks are causing havoc across industries. The aerospace supply chain is vulnerable to cyber threats, given its inherent complexities due to a globally interconnected supply chain and reliance on digital technologies.
Each node in the supply chain is a potential vulnerability that needs fortification. Recent incidents, such as the ransomware attacks on a US-based aerospace supplier providing valves and pressure controls and a UK-based supplier providing aerospace consumables, underscore the need to address these vulnerabilities. These breaches not only impacted the business continuity for the suppliers involved but also for downstream customers, raising concerns about the security of critical aerospace infrastructure.
Economic risks impact the supply chain or financial planning of organizations in the form of tariffs and regulations or reduced market access. Measures such as sanctions and trade restrictions imposed by various countries limit access for aerospace manufacturers to markets as well as supply sources. This in turn results in shortages and price fluctuations.
Having a diversified supplier base, using strategic intelligence teams which can monitor or respond to global events and potential disruptions are crucial to responding to such threats.
Geopolitical risks – conflicts, trade restrictions, and diplomatic tensions – pose another kind of threat to the aerospace supply chain; recent events have highlighted these vulnerabilities. Titanium supplies have been affected due to the ongoing Russia-Ukraine conflict due to sanctions applied on suppliers from that region. Ocean freight premiums and port strain have gone up after escalations in the Middle East due to conflicts and attacks on shipments passing through the Red Sea. These shocks cascade through the sector because of delays in shipments, rise in insurance premiums, and uncertainty in supply planning.
Environmental risks are increasingly becoming a top boardroom agenda across the globe. The aerospace industry faces systemic environmental risk both from its own contribution to emissions, chemical run-offs, and depletion of resources on the environment, as well as the other way round due to adverse weather events, predictable or otherwise, paralyzing key manufacturing or logistics hubs overnight.
Addressing this duality in risks requires a multi-pronged approach involving sustainable sourcing, efficient processes, responsible end-of-life management of aircraft components, and reducing carbon emissions overall, alongside risk-analytics driven scenario planning, and diversified supplier routes.
Strategies to build resilience in aerospace supply chain
Supply chain risks are pervasive and often unpredictable, making it essential for aerospace manufacturers to put in place comprehensive strategies to build resilience.
Supply chain resilience refers to the ability of the company to resist disruption and recover faster to the original state, minimizing the impact on production and delivery. Today’s aerospace chief supply chain officers (CSCO) face constant volatility due to an evolving industry with their span critical in ensuring seamless operations and keeping the engines, quite literally, chugging.
Having a wide array of sources of risk also means that there is so one cure-all solution. There are four broad pillars which need to be strengthened to build resilience, namely, supplier programs, predictive and cognitive ability, simulations and event response procedures, and sourcing strategies.
- N-Tier Visibility and collaboration programs
- Stress testing the supply chain through simulations
- Cognitive Analytics for Fallout Controls
- Agility in Recovery
To address potential risk scenarios, Aerospace manufacturers and suppliers can plan for potential recovery strategies such as Sourcing diversification, that involves working with multiple suppliers to spread the dependency and risk of disruption. Nearshoring, that involves both relocating production or sourcing closer to the primary market(s) or production facilities to shorten lead times, improve supplier communication, and enhance operational control. Strategic stock positioning is another means to maintain reserves of critical material and components to decouple availability from Supply chain disruptions. There is a clear tradeoff here between the inventory carrying costs and ensuring continuity of operations. Recovery avenues can also be at an operational level, such as re-routing logistics operations to circumvent disrupted locations.
Case in Point: A UK-based aerospace manufacturer was experiencing frequent supply chain disruptions and limited traceability of parts, particularly beyond Tier-1 suppliers. To overcome these challenges, TCS selected two critical nickel-based engine rotative parts including alternate suppliers and deployed a four-tier Supply Chain Digital Twin using TCS Twin-X platform. This solution leveraging AI and on Cloud, enabled N-Tier visibility, advanced simulation capabilities, cognitive scenario analysis allowing the manufacturer to accurately predict potential disruptions and significantly improve schedule adherence. Additionally, the digital twin supported enhanced recycling practices, creating a more resilient, efficient, and sustainable supply chain.
N-Tier visibility and transparency programs extend a company's understanding beyond its direct suppliers (Tier-1) to include deeper supplier networks like Tier-2, Tier-3, and beyond including subcontractors and raw material suppliers. This broader view allows companies to gain a holistic view of their supply chain, identify hidden risks early, and enhance sustainability and compliance efforts. It also uncovers new cost-saving opportunities by evaluating lower-tier suppliers for efficiency, ethical practices, and potential disruptions.
With enhanced visibility into their supply chain network, aerospace manufacturers can simulate scenarios and conduct table-top exercises to evaluate their preparedness and objectively assess the true resilience of their supply chain – from short-term shocks such as supplier defaults or natural disasters to medium-term events such as geopolitical or regulatory changes or long-term implications of consumer demand shifts.
These scenarios and simulations incorporate the different links in the supply chain such as demand, raw materials, suppliers, production, warehousing, and distribution essentially building a digital twin of the supply chain. The results show potential vulnerabilities, bottlenecks, and dependencies existing in the supply chain.
Aerospace manufacturers can leverage the wide swaths of internal as well as external data for predictive and cognitive analytics to anticipate disruptions, adapt operations with intelligence and accelerate implementation of response strategies. Some potential use cases are supplier performance and reliability monitoring through historical data on delivery, quality, and even financial attributes. This helps identify at-risk suppliers and activates contingency plans relying on cognitive intelligence. Another use case is where an active web crawler looks for adverse geopolitical or natural events classified geographically or by intensity which a manufacturer should plan for, aiding effective decision making.
The role of technology
Technology is increasingly being viewed as one of the foundation stones to build resilience in aerospace.
The integration of next-generation digital technologies along with the strategies discussed earlier will enhance visibility, agility, collaboration and resilience across the supply chain. By leveraging the technologies, aerospace manufacturers can build more adaptive, transparent, and efficient supply chains, ensuring continuity against disruptions.
- Data: The Foundation of Resilience
Data forms the foundational backbone of resilient supply chains. High-quality, real-time data enables predictive maintenance, demand forecasting, and supplier performance monitoring. For visibility, the first step is to define the Data strategy, avenues of data creation, collection, storage and utilization of data. The key data that would be required are data from internal systems (SAP, MES etc.), supplier data (supplier reliability, delivery times, quality, and overall performance), production data (processes, machines, and quality control) and external data (Geopolitical and economic data, social media sentiment analysis, and public weather data etc.). By consolidating siloed datasets, companies can gain actionable insights into inventory levels, production bottlenecks, and risk exposure. These insights are converted to knowledge and eventually help build intelligence into the systems.
- Cloud Computing: Enabling Scalability and Operational Agility
- Artificial Intelligence: Powering Predictive and Autonomous Supply Chains
AI/Gen AI enhances aerospace supply chain resiliency through automation, optimization and transformation. From demand forecasting, automation of routine tasks to anomaly detection and risk assessment, AI empowers organization to anticipate risks and adapt quickly with self-repair, self-healing capabilities. Generative AI/Agentic AI plays a key role in analyzing data and automating various processes, reducing human intervention in decision-making, improving speed and accuracy in response to volatility. AI-driven digital twins create end-to-end virtual replicas of the supply chain starting from sourcing till delivery providing insights on potential impacts and risks due to inventory levels, supplier issues, transportation delays, and other scenarios. AI empowers proactive decision-making, improving accuracy, agility, and resilience across multi-tiered, high-value supply chains.
- Internet of Things (IoT): Creating Real-Time, Connected Supply Chains
- Blockchain: Establishing Trust, Transparency, and Traceability
Given the regulatory, quality, and reliability demands on the aerospace industry, blockchain brings in transparency, traceability, and efficiency in operations. With a perpetual high level of scrutiny, standards, and low margin for errors, aerospace companies need to embrace technology to boost trust, improve operational performance and maintain a proactive risk-ready stance. By securing data sharing and building trust across international partners, blockchain fortifies aerospace supply chains against fraud, delays, and non-compliance risks.
- Other Emerging Technologies: Transforming Supply Chain
Cloud technology enables scalable, secure, and collaborative environments. It plays a significant role in enhancing cybersecurity by allowing secure and seamless data sharing and management among OEMs, tiered suppliers, and logistics partners, reducing delays and miscommunications. Cloud-based platforms support digital twins, real-time performance monitoring, and global parts traceability. The choice of platform should align with the goals, data sources, data types, platform interoperability, and data security requirements. By centralizing the data and operations, companies can respond swiftly to disruptions and reroute supply chains.
IoT enables real-time monitoring of assets, components, and environmental conditions through connected devices and systems. Sensors embedded in parts or equipment help develop and deploy analytical strategies to improve operational efficiency. IoT can also be leveraged for simulating stress-test scenarios, condition monitoring for predictive maintenance and reducing unplanned downtime. By providing a constant flow of data, IoT enhances situational awareness, streamline operations, and strengthens responsiveness to disruptions in a high-stakes aerospace ecosystem.
Other Emerging technologies like Quantum computing, neuromorphic computing, additive manufacturing among others play a critical role in building overall efficiency in the supply chain. Quantum computing can address complex optimization problems like multi-supplier routing or dynamic inventory allocation faster than classical systems. Neuromorphic computing on the other hand brings brain-inspired processing for real-time decision-making in edge devices, enabling adaptive responses in autonomous systems. Additive manufacturing allows on demand local production of spare parts, reducing dependency on long lead-time suppliers and mitigating risks of global disruption. These technologies together redefine supply chain agility, allowing faster, smarter, and more localized solutions in a sector where innovation, precision, and rapid recovery are paramount.
A roadmap for a resilient, responsive aerospace supply chain
To build resilience into the very fabric of the supply chain, we propose a five-step strategic framework “V.A.U.L.T”, emphasizing protection, security and resilience. At its core, data serves as the foundational layer, enabling dynamic simulations, intelligent risk analytics and real-time decision making. The framework offers a strategic, data-driven approach designed not only to enhance visibility and responsiveness but also guide long-term transformation.
- Visualize the Network
This is a critical and first step towards building resilience. Mapping out the network in detail will help identify all the interdependence and connections between the critical nodes (suppliers, logistics routes, dependencies, and critical parts etc). This step will help to gain end-to-end visibility across the supply chain network.
- Assess the Risks
- Uncover the Path
With risks, impact, and current state identified, it is time to come up with strategies which will either eliminate the risk or reduce its impact. Redesign supply chain strategies to protect against vulnerabilities. Implement dual sourcing, strategic stock, and supply chain reconfiguration. Key considerations include - Think long term, Allocate resources (Finance, Process, Technology, People and Training) and implement protective shield strategies. The strategies discussed earlier should be detailed at this stage, supported by time-bound plans and associated metrics.
- Live Monitoring & Response
At this stage, it’s all about enablement of the strategy and technology acting as the glue. From purpose-built tools such as blockchain bringing in traceability and trust to flexible solutions such as AI and cloud with wide-ranging capabilities such as autonomous decision making, the right choice will depend on the priorities and strategies chosen. Technology is a proven enabler, but success depends on the selection of the right tools, each needing its own set of competencies as well as managing change effectively. At this stage, governance plays a key role in bringing cross functional teams together to work collaboratively towards a common goal – Resilience.
- Transform to Future-Ready
The last step in the framework is where the insights and outcomes are fed back into the program to fortify and continually improve the supply chain. With strategy deployment underway, alongside the data and baseline metrics, resilience governance mechanism established with cross-functional teams from supplier management, process, quality, tech adoption, and compliance to invest in future-proof strategies. This strategy is prepared on emerging risks and future scenarios using Innovation, advanced technologies and adaptive strategies, building agility into the network ensuring readiness for the next frontier. In this step, a key requirement is setting up a crisis response team with clear communication plans and protocols, enabling live and integrated data sources and feeds.
Each element of V.A.U.L.T framework plays a distinct role in strengthening supply chain resilience towards adaptive, proactive and digitally empowered supply chain ecosystem that is Future-ready. Some of the expected outcomes from this approach are:
- Transparency built across supply chain
- Proactive Risk Identification and Readiness
- Redesigned supply chain with key strategies
- Agility built into Supply chain for faster response
- Future-ready and adaptive Supply chain
With the network mapped in detail, the next step is to identify, categorize and assess the impact of the risks and vulnerabilities and the gaps between the as-is and intended state. Use advanced simulations and scenario planning to identify potential disruptions. From geopolitical events to parts shortages, assessing turbulence before takeoff helps anticipate and mitigate threats. A key but often overlooked feature of the ’assess’ stage is establishing the right KPIs early, supported by a continuous feedback mechanism. Metrics like mean time to recover (MTTR), on-time-in-full rate (OTIF) and forecast accuracy help track and improve the agility and flexibility of the supply chain. Setting these metrics and targets upfront ensures focused execution. This assessment and the response of the organization will change over time, and agility needs to be built into the framework for capturing risk and vulnerabilities proactively.
Case in Point: A US-based engine manufacturer faced persistent supplier-side challenges such as low on-time delivery (OTD), quality issues, and inaccurate forecasting. We significantly enhanced their supply chain visibility through a targeted transformation. Key actions included a process maturity assessment, inventory strategy revamping, and digital integration with suppliers for real-time inventory and WIP tracking. The company achieved measurable improvements with supplier OTD rising from 50% to 65%, and compressed parts orders reduction by 20%.
Conclusion
A minor risk today can become a major disruption tomorrow.
The aerospace industry has always been at the forefront of innovation and also faces a complex global landscape and regulatory scrutiny. There is enormous opportunity for growth and transformation but also heightened exposure to potential disruptions. As recent global events have demonstrated, only those organizations that proactively invest in resilience—through diversified supplier networks, workforce development, and advanced technologies — will thrive in the long term.
By following the structured roadmap that has been outlined here and embracing new technologies, aerospace companies can transform their supply chains into agile, intelligent ecosystems capable of withstanding future shocks and sustaining competitive advantage.
