Escalating global tensions have contributed to geopolitical instability and increased demands in the defence industry. This has resulted in a shift away from the cost centric focus in the early 2000s towards a current need for resource efficiency and industrial scaling. The increase in capacity requirements has significant implications for supply chain operations, thereby creating a need for accelerated processes and technological advancement, including AI. However, AI adoption within the defence industry presents a paradox due to the high security centered environment in which organizations operate. Consequently, a clear strategic vision and suitable organizational preconditions become critical factors for successful AI implementation and use. Despite the growing scientific interest in AI, its adoption within defence industry supply chains for operational efficiency remains limited.

This study partly bridges that gap by exploring AI adoption within the defence industry supply chain through a qualitative single case study in collaboration with BAE Systems Bofors. To address this gap, the study investigated Which barriers could occur when adopting AI in the defence industry supply chain? and Could AI be leveraged in the defence industry supply chain when exploring opportunities for operational development?. Therefore aiming to identify emerging barriers, risks and opportunities associated with the implementation and use of AI.  

The findings uncover several internal barriers for AI adoption at BAE, creating tensions and risks for the implementation and use with respect to cultural and security considerations. Additionally, alternatives for AI opportunities were identified and discussed in relation to compatibility and possible utilization for BAE. All together, highlighting a two step approach for AI adoption and the necessity to balance data availability with AI model complexity for risk mitigation, suggesting a pilot project for social sustainability and long term value creation.