The future of the defence industry will be shaped by a range of disruptive themes, with soldier modernisation being one of the themes that will have a significant impact on defence companies. 

In light of growing concerns over armed conflict between peer-level adversaries in an increasingly networked and unconventional battlespace, militaries worldwide are increasingly focusing on enhancing the operational efficiency of the individual soldier. Due to the proliferation of previously niche technological capabilities such as commercial off-the-shelf (COTS) drones and night vision goggles (NVGs), combat zones and the diminishing technological gap between major geopolitical adversaries, commanders at both the tactical and strategic levels have placed greater emphasis on enhancing the capabilities of the individual soldier within the context of multi-domain operations (MDO). The digitisation of the modern battlefield over the last two decades is set to further accelerate due to the rising threat of peer-to-peer conflict, coupled with widespread reductions in active service personnel, thus making the digitisation of soldier systems a primary concern for military strategists. The term ‘dismounted soldier systems’ encompasses a range of different capabilities and technologies, thus providing defence companies with a wide scope of products or services that could enhance the capabilities of the 21st-century soldier. 

However, not all companies are equal when it comes to their capabilities and investments in the key themes that matter most to their industry. Understanding how companies are positioned and ranked in the most important themes can be a key leading indicator of their future earnings potential and relative competitive position.  

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According to GlobalData’s thematic research report, Soldier Modernization, leading adopters include: BAE Systems , L3Harris, Leonardo , Raytheon , Trijicon , Elbit Systems , General Dynamics Mission Systems, Thales , Northrop Grumman , and Teledyne FLIR

Insights from top ranked companies  

BAE Systems  

BAE Systems is the largest European defence, security, and aerospace company. BAE Systems and partners DRS Technologies were contracted by the US Army to supply their ENVG-III/FWS-I soldier and weapon optics suite over the course of five years, with the first delivery of 100 units occurring in October 2016. 

L3Harris Technologies 

L3 and Harris concluded their merger in June 2019 creating a company with an annual turnover of about $18bn with a very strong position in the C4ISR market. The two companies divested some of their business units before the merger. Harris had to sell its night vision unit to Elbit Systems America for $350m due to the overlapping with L3’s relevant division. In October 2019, L3Harris won a $391m contract from the US Army to produce over 10,000 Enhanced NVG Binoculars. In November 2019, the company was awarded an $86m contract to provide Falcon IV AN/PRC-163 handheld radios to the Special Operations Command. 

To further understand the key themes and technologies disrupting the defence industry, access GlobalData’s latest thematic research report on Soldier Modernization.