RSMUS.comThe United States is mobilizing to strengthen its shipbuilding and maritime industrial base. Recent federal actions are targeting shipyard capacity, workforce development, supply chain resilience, procurement reform, and advanced manufacturing as matters of economic and national security.
The policy direction is clear. But expanding physical capacity is only part of the equation.
Shipbuilders, repair organizations, and critical maritime suppliers also need the operational infrastructure to translate increased investment and demand into greater throughput and more predictable execution. That means connecting contracts, funding, materials, labor, production, and financial performance rather than managing them through disconnected applications, spreadsheets, and institutional knowledge.
For many organizations, modernizing that digital operating backbone is becoming as important as modernizing the yard itself.
Capacity constraints do not stop at the dry dock
Shipbuilding is one of the most complex forms of manufacturing. Programs can span years, involve thousands of components, and require close coordination among engineering, procurement, production, quality, finance, and program management.
Government and defense work add another dimension. Shipbuilders must effectively manage the vessel and contract at the same time.
That can mean balancing:
- Engineer-to-order and make-to-order production
- Complex bills of material, routings and engineering changes
- Scarce labor and production resources across competing programs
- Long-lead materials and supplier constraints
- Contract modifications, funding and periods of performance
- Labor distribution and direct and indirect costs
- Material availability and traceability
- Government reporting and audit requirements
- Cybersecurity and controlled information requirements
These challenges become harder when estimating; engineering, procurement, inventory, production and project accounting operate in separate systems. Teams spend valuable time reconciling spreadsheets and transferring information between functions, while leaders may not see emerging cost, material or schedule issues until their options for addressing them have narrowed.
Technology will not create skilled welders, expand a dry dock, or qualify for a critical supplier. But better information can help shipbuilders deploy those scarce resources more effectively.
The national shipbuilding strategy increasingly includes digital modernization
The connection between industrial capacity and technology is becoming more explicit in federal policy.
The April 2025 executive order on Restoring America’s Maritime Dominance elevated shipbuilding capacity, workforce, supply chains and procurement as national priorities. The subsequent 2026 Maritime Action Plan expanded that agenda to include shipyard modernization, digital engineering, automation, and more resilient supply chains.
Congress has also directed significant resources toward the maritime industrial base. The fiscal 2026 National Defense Authorization Act includes provisions addressing industrial-based investment, workforce development, digital engineering, and automated shipbuilding technologies.
Perhaps most relevant for individual shipbuilders, the Navy’s 2026 shipbuilding plan identifies legacy enterprise resource planning and other business systems as obstacles to integrating advanced technologies and data across the industrial base.
The implication is important: rebuilding American shipbuilding is not solely a capital investment challenge. It is also an operating model and information challenge.
A connected digital backbone can improve execution from estimate through delivery
Microsoft Dynamics 365 can provide a common platform for connecting many of the processes that determine shipbuilding performance.
Dynamics 365 Finance and Supply Chain Management bring together financial management, projects, procurement, inventory, warehousing, manufacturing and production planning. Instead of managing each function independently, shipbuilders can establish a more connected flow of information from the initial estimate through contract execution and production.
That foundation can help organizations:
- Improve visibility into project costs, budgets and performance
- Connect purchasing and material availability to production requirements
- Strengthen inventory, warehouse and material traceability
- Improve labor and resource planning
- Connect bills of material and routings to production activity
- Reduce manual handoffs among finance, procurement and operations
- Identify cost, material and schedule risks earlier
A connected data foundation can also support analytics, workflow automation and emerging AI capabilities as an organization’s data, processes and security environment mature.
The objective is not simply to replace an aging ERP system. It is to create an integrated operating model in which leaders can see how decisions in one part of the business affect execution elsewhere.
Defense shipbuilders need more than traditional manufacturing ERP
For defense shipbuilders and suppliers, manufacturing functionality is only part of the requirement.
Government contracts introduce additional considerations around contract structures, funding, project accounting, labor, indirect costs, billing, and audit readiness. RSM’s Government Contracting capabilities extend the Microsoft platform to address these requirements while connecting them to the broader Dynamics 365 operating environment.
This allows organizations to think about modernization across the full lifecycle of government work: estimate to contract, contract to procurement, material to production, labor to project cost and project performance to management reporting.
RSM brings government contracting and manufacturing experience together with Microsoft technology capabilities to help organizations design that operating model, migrate from legacy environments, and integrate the processes and data required to support it.
Secure modernization matters as much as operational modernization
Defense contractors must also consider where sensitive information resides and how their technology environment supports cybersecurity and contractual requirements.
For eligible organizations managing controlled unclassified information and other regulated workloads, Microsoft’s government cloud environments, including GCC High, can provide an appropriate foundation for a broader security and compliance architecture.
Moving technology into a government cloud does not by itself make an organization compliant with CMMC, DFARS, ITAR, or other requirements. Compliance depends on the broader environment, including identities, devices, applications, integrations, data, and operating controls.
Security and compliance therefore need to be designed into the transformation, not addressed after the operational system is built.
Turning national investment into shipyard execution
The renewed focus on American shipbuilding creates significant opportunity for shipyards, repair organizations and maritime suppliers. It also raises expectations for how effectively those companies can scale.
New facilities, workforce programs, and industrial-based investment can expand capacity. Converting that capacity into greater throughput requires companies that can connect contract commitments to materials, labor, production, and financial performance with greater visibility and control.
A modern Microsoft and RSM platform will not solve every constraint facing the shipbuilding industrial base. It can give individual companies a stronger foundation to use scarce resources effectively, manage increasingly complex defense work, and scale with greater confidence.
RSM helps shipbuilders, repair organizations and maritime suppliers assess where disconnected processes and systems are constraining execution and develop a phased modernization roadmap across Microsoft Dynamics 365, RSM Government Contracting capabilities and Microsoft’s government cloud.
Connect with RSM to discuss how your organization can build the digital operating foundation needed for the next generation of American shipbuilding.
Jonathan Reynolds
Jonathan leads the Government Contracting channel for D365 business applications at RSM, with over 15 years of consulting experience selecting, implementing and integrating ERP systems, primarily in the aerospace and defense, financial services, nonprofit, and professional services industries. Prior to RSM, Jonathan worked with over 150 government contractors on both system selection and implementation of ERP tools such as Microsoft Dynamics F&SC, SL, GP, Deltek Costpoint, Unanet, SAP, Oracle, JAMIS, and QuickBooks.
