The Executive Perspective
Changing Expectations for Defence Industry Delivery
Over recent months, we have engaged extensively with senior executives across the defence sector, capturing real-time perspectives on changing expectations for delivery. We synthesise these views to highlight how expectations are shifting and what this means for industry and government stakeholders.
Executive Summary
- Historic tolerance fading: delays/overruns are no longer acceptable.
- Mission-critical urgency: budgets and scrutiny have surged.
- Scale at speed: ramp-ups create doubt about on-time delivery.
- Supply-chain strain: overpromising risk among mid-tiers.
- Regulatory reform: procurement must be faster and simpler.
- Standardisation wins: automotive-style, modular platforms.
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Historical Acceptance of Delays in Defence Programmes
Large defence projects and programmes have long been notorious for delays and cost overruns. In previous decades, governments and contractors often accepted that major programmes would slip schedules or go over budget. This tolerance created a culture where protracted cycles became part of doing business.
However, this complacency is being sharply questioned today. Leaders from faster-paced industries, especially automotive, are astonished at the past willingness to accept drawn-out timelines. As the industry expands under new pressures, insiders describe a “crisis of execution,” replacing the old “that’s how it goes” attitude with impatience for timely results.
A Shift in Atmosphere: Mission-Critical Delivery and Public Scrutiny
Several factors have converged to make on-time delivery of defence programmes more critical. Firstly, the geopolitical environment has injected urgency: with conflict on Europe’s doorstep and military needs rapidly evolving, getting new capabilities quickly is a mission-critical matter. Secondly, defence budgets have exploded to levels unthinkable a decade ago, meaning taxpayers are investing vast sums. In Europe, defence spending jumped 17% in 2024 alone (part of an 83% increase since 2015) – growth not seen since the Cold War. With hundreds of billions of euros in new funding at stake, there is intense public and political attention on whether these programmes actually deliver value on schedule.
For time-critical programmes, our Executive Interim Management leaders help stabilise and accelerate delivery.
Unprecedented Scaling - And Scepticism About Timely Delivery
Several factors have converged to make on-time delivery of defence programmes more critical. Firstly, the geopolitical environment has injected urgency: with conflict on Europe’s doorstep and military needs rapidly evolving, getting new capabilities quickly is a mission-critical matter. Secondly, defence budgets have exploded to levels unthinkable a decade ago, meaning taxpayers are investing vast sums. In Europe, defence spending jumped 17% in 2024 alone (part of an 83% increase since 2015) – growth not seen since the Cold War. With hundreds of billions of euros in new funding at stake, there is intense public and political attention on whether these programmes actually deliver value on schedule.
Supply Chain Strains and the Risk of Overpromising
One major hurdle to timely delivery lies in the defence supply chain, which is under intense strain from the current surge in orders. Large OEMs are pushing their network of suppliers to accelerate production of parts and sub-assemblies. In turn, many smaller suppliers face a dilemma: to win business, they may promise more than they can realistically deliver on tight schedules. This dynamic of overpromising and underdelivering down the supply chain is a serious concern. Already, key suppliers are struggling to fulfil significantly higher demand and keep up with production ramp-ups. In some cases, raw material shortages or limited manufacturing capacity mean that even if a supplier wants to meet an aggressive timeline, it simply cannot do so. This opens opportunities for new suppliers, particularly those with excess capacity, to move into the defence industry and grow with the burgeoning sector.
Consensus: Reforming Regulations and Procurement Processes
To meet these challenges, industry leaders and policymakers alike agree that the defence sector’s traditional regulations and processes need a serious overhaul. The bureaucratic, slow procurement cycle of the past is simply not suited to an era in which speed and agility are paramount. There is a widespread consensus that acquisition rules must be streamlined and made more flexible so that organisations can deliver capability faster and more efficiently. Their goals are ambitious: create a more efficient, integrated, and standardised approach to defence procurement across Europe. Among the measures being pursued are: simplifying the tendering and approval steps, raising spending thresholds that trigger lengthy EU-wide procedures, and enabling more joint procurement so that multiple countries can buy off the same contract without duplication. Executives in the defence industry are supportive of these changes, noting that streamlined procurement will help them plan production better and avoid bureaucratic bottlenecks that now eat up precious time. In summary, there is unity among stakeholders that cutting through procedural inertia is critical.
Our Board Services support governance modernisation and oversight during these transitions.
Embracing a Scalable, Automotive-Style Model
Another consensus emerging in the executive ranks is that defence companies must fundamentally rethink their product development paradigm. Historically, many defence programmes have been country-specific – even when multiple nations buy the same base platform, each tends to insist on unique modifications and bespoke requirements. This results in a proliferation of variants, small production runs for each version, and lost economies of scale. In today’s environment, such fragmentation is a luxury the industry can no longer afford. There is growing agreement that OEMs should shift toward a more scalable, generic model of designing and building military hardware – much closer to the approach in the automotive industry. In automotive manufacturing, a few standardised models (or common platforms) are mass-produced for the global market, with only minor adaptations for different customers. Defence executives now argue that adopting a similar philosophy will dramatically improve efficiency and delivery speed.
Conclusion: A Turning Point to Watch in Europe
Record spending will test whether industry can meet higher expectations for timely delivery. Opportunity and pressure rise in tandem: firms must deliver outcomes that justify investment. The tolerance for waiting times is ending; speed now rivals innovation as a strategic imperative. Europe’s ability to produce faster, at scale, and in sync with allies will shape security in the years ahead.
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