Aerospace and Defense: Innovating Securely at Speed

Aerospace and defense organizations are facing intense pressure to accelerate innovation cycles while maintaining mission assurance and cyber resilience amid rising geopolitical tensions. The shift toward speed-to-field as a core performance metric is driving industry leaders to adopt agile development, modular architectures, and strategic acquisitions of specialized technology firms. This transformation aims to balance the rapid deployment of AI-enabled systems and digital engineering with the rigorous security requirements of government customers.

Large prime contractors are increasingly utilizing strategic acquisitions to bridge technology gaps in digital engineering, AI, and advanced manufacturing. By acquiring firms with specialized competencies, primes can integrate new capabilities faster than through internal development, allowing them to scale emerging technologies across allied markets. This trend is supported by a shift in how innovation flows through core programs, where organizations are decoupling long-term platform development from near-term capability delivery. This is achieved through the use of open systems architectures, digital twins, and software-defined systems, which allow for incremental upgrades without disrupting traditional acquisition timelines.

According to Protiviti’s Aerospace and Defense Top Risks brief, 72% of executives are prioritizing ecosystem development over the next two to three years to share development risks and accelerate access to innovation. These partnerships often combine the scale of traditional primes with the agility of commercial startups and academia. However, integrating these nontraditional partners presents challenges, including mismatched development timelines and intellectual property concerns. Furthermore, 29% of A&D leaders identify the inability to deploy AI at a competitive pace as a top challenge, citing data readiness issues, legacy IT environments, and the expanded attack surface created by AI-enabled systems.

The defense industrial base (DIB), which consists of 60,000 to 100,000 companies, is facing significant strain as it attempts to keep pace with accelerating compliance requirements. Small businesses are particularly vulnerable, with an estimated 75% of companies exiting the DIB employing fewer than 50 people. This contraction occurs at a time when the Department of Defense is pushing for greater commerciality in procurement to reduce costs and increase production capacity. To succeed, David Brand of Protiviti suggests that organizations must navigate expanded supply chains that increase exposure to geopolitical risks while fostering a culture where security and governance act as enablers rather than barriers to speed.