Deep Dive into Digital Twins
Highlights from The Economist’s Enterprise Metaverse Summit 2023
Inspired by the soaring popularity of digital twins, expected to grow into a $48B market by 2026[1], The Economist decided to dedicate its third annual Enterprise Metaverse Summit to this exact topic.
Tanya Suarez, our CEO moderated the panel “the potential for digital twins to optimise inventory management and dynamic supply” along with leading experts Ajay Chowdhury from BCG X, Harry Maddens from Aerospace Technology Institute, Jay Koganti from COE, Dr Ralf Belusa from Hapag-Lloyd AG and Dr Muhammad Azmat from Aston University. A session where they delved into the opportunities, challenges and good practices relating to digital twins within the wider context of the metaverse.
What are Digital Twins and the Metaverse?
Digital twins are 3D representations of physical objects or systems commonly designed within a virtual space or metaverse. Depicting something as simple as a product part or as complicated as a factory production line, little are the limits of their potential applications. As such, the value of digital twins for businesses has long been explored, and yet they only recently gained momentum among digital ecosystems. The growth of IoT and big data produced by IoT devices has enabled the development of extremely accurate real-world simulations that can provide valuable insights to end users across domains.
Promising Applications of Digital Twins across sectors
According to Ajay Chowdhury, managing director and senior partner at BCG X, the metaverse has proved successful for training purposes, particularly in oil and gas companies. Its effectiveness in simulating the operation of complex structures like oil rigs, renders it a much more promising alternative to two-dimensional (2D) visualisations.
In many cases, digital twins can even be built before physical systems, to allow for efficient design and quicker payoff. For example, digital supply twins can predict operational issues, such as bottlenecks, to avoid when executing a specific process.
It has also found several applications in The Estée Lauder Companies. As Jay Koganti, vice-president, and supply chain COE, reveals, Estée Lauder has used digital twins to facilitate inventory management, predict and better respond to needs of all nature in their warehouses.
In the field of shipping, interconnected digital twins are commonly built to map interactions between a series of functional elements, from containers and vessels to ports and on-land transportation vehicles. Dr Ralf Belusa, chief digital officer and managing director at Hapag-Lloyd AG, is as optimistic as to predict that traditional 2D websites for bookings and orders will become obsolete in the context of his sector within 10-15 years.
From Concept to Success: Common Implementation Challenges
As Harry Malins, chief innovation officer at the Aerospace Technology Institute, pointed out, integrating digital twins into company processes is not all that easy. Besides building the necessary skills to harness the benefits, organisations need to support high levels of computer power and establish secure networks to handle large volumes of data.
Challenges around big data cleansing and interoperability can be mitigated by moving the data closer to the edge: decentralised data storage systems like data oceans, and relevant frameworks are rapidly emerging. However, overall investment costs remain a significant barrier to deployment, especially for smaller businesses.
On top of that, the underlying technologies need to be better understood and perfected, before even identifying relevant use cases for end users from the general public. Thus far, finding appropriate use cases, in which digital twins perform better than established alternatives, resembles a “hammer looking for the nail”, as described by Jay Koganti.
What does the Road to Large-Scale Implementation look like?
Despite the numerous anticipated benefits, data twins and the metaverse remain at an early stage of development. New applications and opportunities to gain value from them are bound to increase, which means that organisations should adopt them incrementally to harness best outcomes, while minimising associated risks. They should also recognise the interconnection between the underlying technologies and consider them holistically; no single element is of value in isolation.
Additionally, businesses need to develop an innovative mindset, define the limits for experimentation, operationalise purpose-built digital twins and “break the functional barriers to be able to get transparent data”.
Linking back to the challenge of the available data volume, Ajay Chowdhury warned about potential incidents of “data overload”. At the end of the day, the outputs of digital twins and the metaverse are interpreted by humans and the overabundance of non-relevant data can impede their task.
Last but not least, Dr Muhammad Azmat, assistant professor in logistics and SCM at Aston University, stressed the importance of safety of data used within the metaverse context, suggesting cybersecurity aspects be taken into account at all stages.
Digital twins and the metaverse represent a significant opportunity with potential benefits across various industries. Among others, they offer innovative solutions for inventory management and supply chain optimisation. Yet, overcoming associated challenges, requires businesses to develop thorough plans for integrating digital twins in their existing processes well in advance.
[1] Enterprise Metaverse Summit, ATI, 2023
See the full panel discussion here:
