July 1, 2022
By Joe Sheeran
Defense departments across the globe require healthy, resilient, diverse, and secure supply chains to ensure the development and sustainment of capabilities critical to national security. Contractor success can be achieved—or missed out on—by the quality and completeness of their product data.
To secure contracts with a defense department, companies must prove far more than their ability to produce a specific product. Contractors must also confirm they can uphold the highest standards for quality and integrity, operate in compliance with all mandates and regulations, and test and vet products in line with the required parameters.
The supply chain is both critical and immense for organizations who work with a defense department. For example, the average American aerospace company contracted by the U.S. Department of Defense (DoD) relies on more than 12,000 companies. Due to the globalization of supply chains, these suppliers and their goods come from a wide array of places with foundational industrial supply chain sectors, and the disruption to these supply chains can be disastrous.
This blog post discusses why it’s crucial to comply with defense department standards and details how utilizing a traceability solution can ensure the highest product quality and maintain compliance with stringent requirements.
The average American aerospace company contracted by the U.S. Department of Defense
Global Defense Departments’ Current Challenges
Defense departments worldwide are committed to maintaining their supply chains, reducing costs, and holding contractors to the highest standards. Each is finding challenges with current global supply chain shortages, price increases, and complex bureaucratic processes, however. The U.K. Defence Department, for example, is finding it difficult to attract non-traditional defense suppliers and that their defense industry has been slower than other sectors at taking up innovative processes and advanced manufacturing technologies.
To solve these kinds of problems, a defense department like the U.K.’s must ensure they work with suppliers who utilize the right kind of supply chain solution to maintain efficiency, quality, and compliance. The U.K. government is currently focusing on technology and promoting SME engagement with the defense supply chain through initiatives that seek to support lower tier suppliers.
Similarly, Australia’s Defence Department has noted that it requires a “fundamental rethink” in how to establish resilient end-to-end supply chains in Australia, and how investment in their domestic defense industry is supported and prioritized. It is focusing on initiatives like a Defence Innovation Hub, and expansion of Australia’s Sovereign Industrial Capability Priorities. Contactors, therefore, should ensure they are able to meet the terms that the government mandates and its future goals for its national supply chain.
The U.S. Department of Defense’s Stringent Requirements
The U.S. Department of Defense has strict regulations and mandates compliance for its contractors. This year, the department revealed its concerns about issues in the supply chain and requested additional efforts to be made by contactors and organizations in order to boost its resilience. In February, it released a strategic roadmap to address supply chain vulnerabilities in the Defense Industrial Base (DIB). “Executive Order 4017, America’s Supply Chains” directed cabinet agencies to assess supply chains in sectors critical for economic and national security. In the report “Securing Defense-Critical Supply Chains,” the DoD presents recommendations for high-priority areas in the DIB, with input from the National Security Council and National Economic Council.
The report highlights the strength and value of America’s supply chains, and discusses the pervasive need for more transformative investments to help build greater supply chain resilience. It focuses on addressing challenges in high-priority areas critical to operational readiness, including kinetic capabilities, energy storage and batteries, castings and forgings, microelectronics, and critical materials. The report also highlights a set of strategic enablers that support overall mission success and supply chain resilience, like workforce, cyber posture, small business, and manufacturing capabilities.
The DoD outlines not only a whole-of-government, but a whole-of-nation strategy to assessing and strengthening supply chains critical to the DIB and national security. The DoD demands that contractors uphold exacting quality standards by outlining a wide-ranging set of recommendations like applied research, workforce development initiatives, policy and procedure reviews, and more.
Faulty products can mean the world of difference to the end consumer. With no room for error, it’s vital to collect highly detailed insights at every stage of the product lifecycle and store comprehensive data in a secure database. DoD contractors need to uphold detailed compliance requirements, and determine the optimal printing techniques to secure products throughout production and beyond.
Some of the requirements that the DoD requests include:
Contractors achieve this standard of integrity by tracking and documenting quality from pre-production to end of lifecycle, and isolating and eliminating those products that fall short. With innovative technology in place, highly-detailed information can be collected at every stage of production, allowing contractors to prove product quality at a moment’s notice.
Additionally, the DoD is still struggling to secure reliable supplies at reasonable costs, partially because of the small market size for many defense requirements and the department’s program-driven procurement cycles. With the use Ashton Potter’s ProLinc® solution, however, smart aggregation can be enabled, which accommodates material consolidation, product movement, and distribution. This implementing of aggregate demand allows for more reliable supply sourcing, better decision making, and improved ROI.
How to Comply with Regulations Through Traceability
With the globalization of supply chains, suppliers and their goods come from a wide array of places, and being able to accurately track them is necessary to mitigate potential and emerging issues in the supply chain. The risk of disruptions has only grown with the increasing complexity of defense supply chains. Disruptions to these complex chains cause significant costs to industries—For example, the 2021 power outages in Texas cost a semiconductor fabricator more than $100 million and a month of lost wafer production.
Departments and ministries of defense are feeling the pressure to ensure quality globally. Government contractors working overseas must consider many factors when finalizing their bid for contracts. The majority of defense and security procurements are conducted in accordance with the GPA or the European Union treaties, but a minority of contracts are still awarded in the context of national security and other exemptions. For instance, the European Union has adopted the Council Common Position 2008/944/CFSP which defines common rules governing control of exports of military technology and equipment. Another main piece of legislation in the U.K. under the Act is Export Control Order 2008, which controls the trade and exports of listed military and dual-use items (i.e., goods, software and technology that can be used for both civilian and military applications).
When it comes to defense contracts, there is no room for compromise. Maintaining contracts oftentimes comes down to a contractor’s ability to prove product integrity. Supply chain resilience is critical for national security and economic strength, creating the need for bold action in support of supply chain security. Global departments require clear visibility and tracking from their contractors to ensure compliance. That’s why storing product-level data in a tamper-proof, Blockchain-enabled database is critical, empowering contractors to access real-time insights about production, performance, and product authenticity.
Utilize the Right Technology to Ensure Quality
Through the power of forensic traceability, defense contractors can uphold exacting standards for product quality and integrity, and the right traceability solution is needed to be able to track these various suppliers and goods. With regards to recalls, the ideal solution will allow contractors to isolate and eliminate any compromised batches for quick resolution—as well as preventing issues from occurring in the first place.
With a solution like Ashton Potter’s ProLinc®, defense contractors can ensure product authentication via a single scan—monitoring products and their individual components throughout the manufacturing process, and testing and documenting performance to guarantee every product is safe and compliant. With individualized, serialized identities for each product, centralized reporting in real time, and quick and remote access to tamper-proof database files from the field, contractors can confidently validate items and earn the defense department’s trust.
Work with the Right Partner to Maintain Compliance
Ashton Potter has the proven experience to uphold supply chain excellence in the most mission-critical industries, as our ProLinc® technology tracks and serializes over 1.6 billion secure products. Partnering with Ashton Potter enables defense contractors to uphold compliance standards and prove the integrity of their goods. Contractors are able to meet rigorous requirements for product integrity by serializing and tracking products and their subcomponents during every stage of the manufacturing process.
View Now
When satisfying stringent and compliance-driven contracts such as those demanded by defense departments, ProLinc® provides the forensic traceability required to track and document product quality throughout production and distribution. With a single scan, Ashton Potter equips contractors with the richest insights about production, performance, and authenticity.
Speak with an expert to learn more about ProLinc® and how it can ensure quality while complying with DoD standards.