Unresolved conflicts, new security threats and demands for higher military spending from the other side of the Atlantic: Europe's defense policy is under pressure. In this politically turbulent environment, more than 90 per cent of armaments companies are expecting increasing budgets on the old continent.

However, geopolitical uncertainties are here to stay for the A&D industry. Paradoxically, managers feel prepared for the unknown. This is the most stunning result of our 9th A&D Top Management Issues Radar 2017. This year, we interviewed roughly 220 senior industry executives from almost 100 companies in 15 countries.

Almost two thirds of companies (63%) say they feel highly prepared to deal with geopolitical risks they cannot influence. On the other hand, respondent firms are far less optimistic about their own internal issues, with more than half (56%) feeling less prepared to change important things over which they actually do have control. These include their own in-house innovation and their ability to develop new production technologies. This attitude is surprising – we call it the preparedness paradox.

Our A&D experts believe that the findings indicate an urgent need to bring back strategy, not least because companies are increasingly recognizing that the A&D industry will not escape the march of digitization

Read all the details to learn about the issues behind the industry's overall optimism.