And so those things remain the same as you think about our 2023 guide. Now what is different, right? And we’ve been talking about a lot of this in 2022, but what’s really different is those proactive actions that we took last year to be purposeful and focusing on the things we can control. They help to minimize the risk in 2023. And so just a reminder, engineering redesigns were a big focus for 2022. We get the full value of that benefit in 2023. Our alternate part bank within our Tactical Communications Systems business is up to 1,000 parts. That would have been at 100 parts in 2021. Our overall revenue base in terms of DPAS coverage, it’s also increased double digits. So that aids in the prioritization of our supply and material availability.
And then finally, I think this is the most important predictive indicator is the number of critical parts. When we started and we felt the most acute impact from supply chain was really in the second half of 2021. We had hundreds of critical part shortages at that time. Fast forward to where we are today, and we’re in the 10s in terms of the impact and what we’re having to manage through. So the way I would characterize this is we continue to see sequential improvement from a supply chain perspective. We’re not out of the woods by any means. And so as a result, we’re taking a balanced approach to 2023, and that’s what’s reflected in our guide.
Operator: Our next question comes from the line of Robert Spingarn with Melius Research. Please proceed with your question.
Robert Spingarn: Hi. Thank you. So Michelle, just on the back of all of that, it seems like the positives are there might support higher margins in 2023. Now I know the guidance range allows for that. But what would cause the downside?
Michelle Turner: Yeah. No, great questions. So let me walk through from a margin perspective. I’ll start from the overall enterprise, right? To your point, Rob, we are assuming flattish margins, 15.4, 15.5-ish. From a headwind perspective, we are assuming continued macro inflationary challenges of about $400 million, so about 2.5% of our overall revenue. And we also have some headwinds from a mix perspective. Chris talked about where we’re investing in space. Kelly and her team are doing phenomenal in terms of growing the business. At the same time, however, that will be a drag on our margins. As these new programs come on board, we typically book them at lower rates. And as we mitigate the risk, we start to see the profitability in those programs improve.
So from a headwinds perspective, inflationary, challenges and mix, that is being offset by our continued strong E3 savings program, as Chris alluded to earlier. Real estate is a great example of that. Another great example is the voluntary retirement program that we announced at the end of Q3 last year. That’s going to help to pay dividends and offset the merit increases that we’re planning for from a human capital perspective. And then we’ve also assumed some level of commercial pricing. To your point, specifically, Rob, like what is the downside? The downside, from my perspective is this continuation of the unknown unknowns from an inflationary challenge perspective, right? There was a lot that permeated within 2022 that it felt like it was more of a reactionary year.
And so, as a result, we’re doing everything that we can to control the controllables. And we will prudently manage through that as we make our way through 2023.
