I recently came across this note in Industry Week that goes into some detail on Boeing's recent $2.1 billion win selling defense equipment to the Indian military. But what does not get discussed in the piece is that how other defense contractors have lost billions of dollars in Indian defense contracts not because they weren't selected as a preferred supplier, but because they failed to meet offset requirements to source a certain percentage of the total award from local suppliers. We all too often think that global sourcing is all about saving money. But in the A&D world, it's often more about the ability to serve local markets. Is this a sign of things to come in other industries, especially in a down economy where significant capacity exists in our own backyard? I suspect so. Which means that companies need to think through how they can best leverage both their teams and online tools to identify, qualify, engage and manage local suppliers not just on the basis of cost, but to grow the top line as well. Note to President Obama: Don't take a queue from your predecessor -- Isolationism benefits no one. Especially those looking to benefit from selling into global markets!
- Jason Busch