Product–service system affordability in defence and aerospace industries: state-of-the-art and current industrial practice

Abstract

This article reviews through life costing practice with affordability considerations. This provides a holistic view of through life costing by assessing the customer's financial ability to procure and support defence contracts, particularly at the bidding stage. The paper reviews literature on affordability from three perspectives of the customer (affordability), manufacturer (profitability) and supplier (sustainability) then reports industrial practice within the aerospace and defence industries. The article is aimed at securing definitions, methods of assessment and management of affordability. This is achieved through the review of literature materials and current industrial practice within the defence and aerospace industries. The main contribution of this article is that it provides the state-of-the-art review of affordability from the three perspectives and together with definition and assessment methods for affordability. The findings helped to identify qualitative and quantitative factors affecting affordability and assessment techniques from the three affordability perspectives. Also, a gap analysis of literature and current industrial practice in terms of definitions and assessment methods was performed based on research findings. This article provides direction for future research in affordability based on the three perspectives of affordability. The limitation of the review is its focus on defence and aerospace industries without including other industries; however, this was done in order to maintain the focus of the study.

Keywords:

• product–service system
• affordability prediction
• customer affordability
• manufacturer profitability
• supplier sustainability