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EL SEGUNDO, Calif., Nov. 15 - A majority of companies have no formal plans in place to support the Jan. 1, 2005, U.S. federal government requirement to initiate use of radio frequency identification (RFID), according to the third annual Aerospace and Defense (A&D) Industry Survey conducted by Computer Sciences Corporation (NYSE: CSC) in association with the Aerospace Industry Association (AIA) and Aviation Week and Space Technology magazine. The survey also revealed that information security and the desire to attract, train and retain replacements for the retiring workforce are quickly becoming major initiatives - on par with cost concerns and surpassing the impact of industry consolidation. More than 160 companies representing all major A&D segments responded to the survey, which was expanded this year to include overall business, as well as technology topics. Government initiatives continue to dominate the industry with more than 80 percent of respondents indicating they have government customers. "A surprisingly large percentage of the companies surveyed indicated that they had no finalized plans to implement RFID," said Pete Wiese, leader of the Aerospace and Defense practice within CSC's Consulting Group. "However, it was encouraging to see that nearly 75 percent of the companies are aware of the requirement and have initiated dialogue." According to the survey, most of the respondents have or will have an RFID/unique identifier (UID) requirement, but almost three quarters of them are unsure as to how they are going to pay for or use these technologies. Similarly, most respondents believe that government initiatives for more frequent program reporting or earned value management mandates do not apply to them. However, if the government does mandate more frequent program reporting, only 37 percent of respondents feel equipped to respond in a timely manner. When asked to rank the industry forces that would affect their organizations over the next two years, 77 percent of respondents identified information security and the protection of intellectual property as having the greatest impact. The survey also indicated that companies of all sizes are experiencing, or will soon encounter, a labor shortage related to the large number of retiring workers with legacy knowledge of company operations. Larger companies (more than $1 billion in revenue) are experiencing the greatest impact. Most respondents look to the federal government to help address the skills gap. "It is imperative that government and industry work together to address the challenges and demands of a technologically trained future workforce," said John Douglass, president and CEO of AIA. "AIA is working with all interested stakeholders in implementing a national plan to revitalize the U.S. aerospace workforce." Regarding information technology (IT) and its role in the business, more than three-quarters of the companies surveyed indicated that their IT and business strategies are either "well" or "very well" aligned. Not coincidentally, these same companies had a significantly higher overall satisfaction with their IT investments. Therefore, noted Wiese, the best predictor of a company's satisfaction with their investment is whether or not they have aligned their IT and business strategies. However, while most respondents are generally pleased with their return, there is concern that their IT and operating groups are out of sync with one another. Although the industry is not increasing overall spending, companies that perceive themselves as leaders and quick adopters of technology are spending more, doing a better job of tying business and IT strategy together - and are happier with their results. In general, however, spending is targeted primarily at maintaining operations and doing day-to-day business rather than pursuing strategic initiatives. The overwhelming number of respondents indicated that they are getting the value they expected from their IT expenditures. "This is a 180-degree shift from last year's results when considering the value received from IT investments," said Anthony Velocci Jr., editor-in-chief of Aviation Week and Space Technology Magazine. "For those who did not feel they received the expected return on investment, the biggest obstacle to success resulted from a failure to change business processes along with the technology." A total of 349 respondents from 160 companies completed the comprehensive, six-page questionnaire from May to July. The responses came from North America, mainly the United States. Respondents comprised three groups: past respondents, AIA member companies' "senior management" list and Aviation Week and Space Technology senior management-level subscribers. Organizationally, 87 percent represented corporate entities, 11 percent were from other institutions and two percent were from the military. Company size ranged from less than $100 million to greater than $5 billion in annual revenue. About CSC Founded in 1959, Computer Sciences Corporation is a leading global IT services company. CSC's mission is to provide customers in industry and government with solutions crafted to meet their specific challenges and enable them to profit from the advanced use of technology. With approximately 91,000 employees, CSC provides innovative solutions for customers around the world by applying leading technologies and CSC's own advanced capabilities. These include systems design and integration; IT and business process outsourcing; applications software development; Web and application hosting; and management consulting. Headquartered in El Segundo, Calif., CSC reported revenue of $15.3 billion for the 12 months ended Oct. 1, 2004. For more information, visit the company's Web site at www.csc.com.
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Contact:
Rich Venn, CSC |
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