Solving complex A&D challenges through digital transformation with IFS

The aerospace and defense (A&D) industry is at the intersection of national security, global collaboration and advanced engineering, a space where operational excellence is a necessity. Organizations are under constant pressure to modernize, yet every transformation must operate within a tightly controlled environment shaped by export regulations, security clearances and geopolitical constraints. Unlike other industries, digital transformation in A&D cannot be approached with a “move fast and iterate” mindset. It requires precision by design, where compliance and operational performance are built-in from the outset.

As enterprise resource planning (ERP) platforms like IFS Cloud become central to enabling this transformation, the real challenge is how to modernize at scale without compromising control. The following explores the most pressing A&D challenges and how to address them in practice.

The challenges in the A&D industry and how to address them

Challenge 1: Data segregation

A&D organizations must manage a complex mix of classified, International Traffic in Arms Regulations (ITAR)-controlled and commercial data. Regulations such as UK export control laws and ITAR impose strict requirements on data access, storage and transfer, often across multiple jurisdictions.

The challenge arises when data segregation is treated as a configuration task within the ERP system. In reality, this approach falls short, data segregation is not purely a system configuration issue rather an enterprise architecture problem. Logical controls alone are often insufficient, creating exposure to compliance breaches.

Resolution:

• Treating data segregation as an enterprise architecture priority, not a system setting
• Designing segregation upfront across data classification, user clearance levels and legal jurisdiction
• Implementing physical or tenant-level separation where required
• Aligning early with security teams and export control stakeholders

Challenge 2: Security clearance

Security clearance requirements, introduce a layer of complexity that directly impacts program delivery. The challenge is both regulatory and operational:

• Limited availability of cleared resources
• Long lead times for clearance (often months)
• Restrictions on how and where work can be performed

Without planning for this, projects face delays, resourcing gaps and delivery risk.

Resolution

• Building a clearance-aware delivery model into the project plan from the outset
• Leveraging pre-cleared subject matter experts to accelerate early stages
• Using a segmented delivery approach with cleared core resources and non-cleared peripheral workstreams
• Planning early for resource onboarding and secure infrastructure setup

 Challenge 3: Supply chain traceability and export control

In A&D, traceability is best practice and a regulatory expectation. Organizations must be able to demonstrate full visibility across the lifecycle of controlled components. The pressure comes from the need to demonstrate complete traceability across operations and supply chains:

• Tracking bill of materials (BOMs) across complex, global supply chains
• Proving supplier provenance and compliance
• Maintaining detailed audit trails over multiple years
• Managing re-export and re-transfer risks

Without integrated systems and controls, this becomes a fragmented, manual effort that is highly vulnerable during audits.

Resolution:

• Embedding compliance directly into procurement, manufacturing and engineering processes
• Automating identification of controlled items and export license requirements
• Enabling end-to-end data lineage and auditability
• Ensuring systems can answer critical questions including who accessed or modified data, when it happened and under what authorization

Real-world A&D transformation success stories with Baker Tilly

1. Secure global logistics for a leading A&D organization

Client background

A global A&D organization operating across the UK, Europe, North America and the Middle East, supporting fleet operators and major original equipment manufacturers (OEMs). The company provides maintenance, repair, overhaul and manufacturing capabilities for military and civil aircraft within a highly regulated environment governed by European Union Aviation Safety Agency (EASA) and Federal Aviation Administration (FAA) requirements.

Project scope and approach

The engagement supported software infrastructure for a foreign government contract involving the global transportation of sensitive goods, including weapons.

Key activities included:

• Developing and integrating systems to track the geo-positioning of containers
• Supporting technical work within the IFS environment focused on data segregation and system integration
• Supporting preventative maintenance activities for transport units within IFS

2. Global IFS rollout for a defense electronics manufacturer

Client background

A global defense and aerospace electronics manufacturer delivering application-engineered solutions across defense, security and critical detection sectors. The organization operates across numerous technology niches and maintains a strong focus on asset management practices, including PAS55 and ISO55000 integrations.

Project scope and approach

The project focused on a global rollout of IFS Applications 9 using a standardized operating model template across finance, manufacturing, supply chain and document management functions.

Key activities included:

• Adherence to Ministry of Defense (MOD) and Department of Defense (DOD) data segregation requirements
• Classification of military parts in line with ITAR rules
• Rollout of the IFS defense manufacturing extension
• Functional implementation, data migration, custom reports, interfaces, modifications, and extensions (CRIM) activities
• Enablement of shop floor time reporting

3. Global standardization and IFS upgrade across manufacturing operations

Client background

A global fluid handling manufacturer serving A&D, energy and industrial sectors through specialized engineering solutions, with operations spanning North America, Europe, Asia and other global regions.

Project scope and approach

The project centered on a global standardization initiative and upgrade to IFS Applications 10 (IEE) through a multi-phase transformation program.

The scope included:

• Developing and rolling out a common operating model globally
• Enabling internal stakeholders to lead rollout cycles and long-term support
• Supporting functions across finance, supply chain and demand planning, manufacturing, engineering and product design, maintenance and component and human resources

Additional considerations included ITAR compliance requirements, complex data migration activities and a three-year implementation timeline.

How we can help

Baker Tilly provides the manufacturing industry with a complement of resources, capabilities and an approach to IFS Cloud implementations that is market-leading and will be transformational to your business. Aerospace and defense manufacturers can leverage Baker Tilly’s deep industry experience alongside IFS Cloud capabilities to support operational efficiency, compliance, supply chain management and long-term business transformation.

Ready to navigate A&D complexity with confidence?