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Three Steps to Better Profit Pools

A substantial growth opportunity lies in capturing additional profit pools associated with existing platforms, including original equipment manufacturing, research and development, profits earned by suppliers, training, parts and spares, maintenance, modernization, and operations.

Aerospace and defense players can take action to secure their own profit pools and pursue competitors’ profit pools with this three-step approach:

1. Determine the High-Priority Profit Pools to Target for Participation

  • Specific subsystems or components along the supply chain
  • Training
  • Maintenance
  • Aftermarket

2. Determine the Advantage that Can Be Leveraged or Build as the System Integrator to Create Value for the Customer

  • Technical
  • Understanding of operational requirements and performance
  • Business model

3. Determine the Best Play and Execute on It

  • Organically: shaping requirements, pricing, different contracting
  • Inorganically: M&A, partnerships
Engineered Products & Infrastructure
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