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Strategy & Corporate Finance

Helping aerospace and defense companies achieve their strategic goals in a complex, competitive, and evolving landscape

 

Aerospace and defense (A&D) companies are under increasing pressure. Strong growth over the past few years has raised investor expectations, but defense budgets are flat. Meanwhile, the sector is becoming more complex as new entrants compete for market share and the aftermarket evolves. In this intense environment, it’s not enough for A&D companies to follow their old approach when fighting for a bigger piece of the pie. They need new strategies.

We combine a deep understanding of industry segments—commercial aerospace, defense, and space—with leading-edge tools to help our clients address their most important strategic questions and take their business to new heights.

What we do

Capture excellence

Even the best product needs a strong capture strategy to guarantee its success. By helping clients assess when to bid, how to price, and how to structure their business-development operations, we can increase the likelihood of winning market share.

Corporate finance

With budgets tightening, A&D companies want to optimize working capital and increase available cash. In cooperation with experts from our Strategy and Corporate Finance Practice, we guide them through this process.

Cost effectiveness

Margin expansion is critical, especially in competitive industries such as A&D, but it sometimes gets overlooked in the push for growth. Working with companies, we evaluate operating models and identify strategies for building leaner cost structures—for instance, by considering options to streamline corporate function support.

Growth

We help companies accelerate their growth strategies by taking a comprehensive look at opportunities—both organic and inorganic—in their core business and adjacent markets. By balancing risks with potential gains, we identify the big moves required to accelerate value creation.

Market assessment

Through our independent assessments, we help businesses, private-equity firms, and other industry stakeholders understand critical markets, including the size of the opportunity, growth prospects, and competitive forces. Our insights give clients a fact-based perspective on the market, including recent trends and the impact of new technologies.

Portfolio optimization

With markets shifting—and sometimes taking unexpected twists—even the most effective portfolio strategy may become obsolete. With our guidance, clients can rebalance their portfolios and adjust their investment strategy, doubling down in some areas and retreating in others.

Featured Capabilities

Corporate Performance Analytics

Corporate Performance Analytics is a digital platform for benchmarking financial performance data, developing strategies, and uncovering insights for data-driven decision-making.

Radar

Combines hard data with analytical tools to provide extensive information on A&D markets. The insights help companies develop their portfolios, reduce spending, and make better decisions about budgets, growth opportunities, and research.

Strategy Analytics Center

We help clients make better strategic decisions through a deeper understanding of corporate performance, value creation, macroeconomic forces, and global and local trends.

Featured Experts

Ryan Brukardt
Senior Partner
Advises global aerospace, defense, and space companies on achieving sustainable growth and operational excellence
Frank Coleman III
Partner
Serves Industrial clients on strategy and M&A, driven by value creation fundamentals and underpinned by complex technology investments
Chris Daehnick
Senior Solution Leader & Associate Partner
Leads Radar, McKinsey’s analytic platform for defense, space, and commercial aviation markets, directing a team of market and software experts who serve clients both directly and through publicly available insights
Guillaume de Ranieri
Partner
Guillaume de Ranieri specializes in R&D and large industrial projects management. He leads the Aerospace and Defense Practice in France.
Alex Dichter
Senior Partner
Helps airlines, airline-services companies, and aerospace firms develop profitable strategies and improve global operations
John Dowdy
Senior Partner
Helps aerospace and defence organisations improve operations and identify growth opportunities, and works with defence forces to transform their performance
Jesse Klempner
Partner
Assists aerospace, defense, and industrial companies with strategy, growth, innovation, and mergers and acquisitions, and consults on diligence, strategy, and portfolio-company optimization for private equity funds
Vik Krishnan
Partner
Advises companies in the aviation, travel, and aerospace sectors on operational-performance improvement, digital transformation, and growth
Alexandra Nee
Partner
Helps clients develop robust growth strategies and improve diversity, equity, and inclusion in private equity and public sectors
Allie Owens
Associate Partner
Serves clients on growth strategy, financial transformations, working capital optimization, transactions, and commercial due diligence
Alex Panas
Senior Partner
Global co-lead of McKinsey’s Advanced Industries Practice
Michael Park
Senior Partner
Coleads the People & Organizational Performance Practice and partners with leaders to shape strategy, improve performance, and drive lasting change by making talent a competitive advantage and establishing an organization fit for the future
Robin Riedel
Partner
Draws on deep aviation and transformation expertise to help companies in the air transport and aerospace sectors transform their businesses and enhance performance
Shivika Sahdev
Partner
Serves automotive and aerospace OEMs, suppliers, private-equity investors, and governments on disruptions in mobility and their likely impact—on the ground and in the air

Featured Insights

Rethinking inventory management in defense

– Defense companies will have difficulty unlocking cash as their balance sheets become increasingly burdened with unbilled receivables. A new inventory-management approach can help.

The CEO agenda for companies in advanced industries

– As automotive and industrial companies take tactical steps to survive the pandemic, they should seize the opportunity to embrace ten actions to sustain leadership and value creation in the coming decade.

Modernizing military acquisition and sustainment for the 21st century

– A strategy with five ingredients can help acquisition systems deal with stretched budgets, time overruns, and the COVID-19 crisis.

Aerospace and defense spending: What will be the next normal?

– Defense budgets might be stable now, but governments may reduce spending in the aftermath of the COVID-19 pandemic.

Large LEO satellite constellations: Will it be different this time?

– New satellite constellations are on the cusp of deployment, but their long-term success hinges on substantial cost reductions.

Refining the flight path: Seven priorities for commercial aerospace leaders through 2020

– Commercial aerospace companies need to focus on several areas, from the evolving industry structure to the development cost curve, to stay competitive.

Connect with our Aerospace & Defense Practice