• Mary G. Stokes

Digital Twins: Engines Of Business Transformation

Updated: Dec 30, 2021

If you had the opportunity to innovate with minimal risk of failure, would you use it? We suppose that yes. The fear of making mistakes stands as a Berlin wall between businesses and progress.

So, management should break it somehow. Digital twin technology is considered an efficient tool for this purpose. Its global market size was $3.1 bln in 2020 and will skyrocket to a shocking $48.2 bln by 2026! So, why is it important? How does it both facilitate the creation and implementation of new ideas? We suggest you spend a few minutes discovering it here.

What Is a Digital Twin And How It Differs From Simulation

The definition of digital twin

A digital twin is a program that uses data and mathematical calculations to recreate any real object in virtual space. You've probably heard about non-fungible tokens or the effortless disposal of material resources in digital mode. Many startups like Paxos are betting on it.

Forbes: a digital twin is a virtual model of a process, product or service.

But what are virtual twins for digital transformation? First of all, they are its engines. Imagine using Industry 4.0 technologies you can create a replica of a gas station or retail store. You would be able to implement and test innovations in the virtual space without risks. You could evaluate the bigger picture and understand what your business is missing. Wouldn't that prompt you to start improving your business as soon as possible?

Digital Twin Architecture

It may seem to you that the digital twin is nothing more than a simulation. Indeed, they are too similar. But let's sort out the differences.

The definition of simulation

Following Britannica, “it's a research or teaching technique that reproduces actual events and processes under test conditions.” The simulation method also uses mathematical calculations. It also allows you to predict the result and test innovations in an isolated digital mode.

Cambridge Dictionary: a model of a set of problems or events that can be used to teach someone how to do something, or the process of making such a model.

The main difference between digital twin and simulation results is the ability to be connected with a real analog during its entire life cycle. Digital twins use IoT and AI technologies to interact with their material copies, receiving data about their state and operation in real-time. What's more, this tool even lets you manage assets remotely using a digital copy. It sounds more imposing than regular simulation, doesn't it?

Types of Virtual Twins

  1. Digital Twin Prototype (DTP). DTP is exactly the kind of twin that most resembles simulation. It is a model for testing and analysis made before creating the asset itself. This approach can reduce implementation costs and identify bottlenecks at the early stage. It is actively used in manufacturing, automotive, and aircraft construction. In other words, everywhere where companies often implement new tools for efficient operation.

  2. Digital Twin Instance (DTI). It's the second link in the hierarchy. DTI is an exact copy of an asset that allows companies to analyze its current state and test its performance in various artificially created conditions. It's often used for retail supply chain improvement or analyzing equipment operation in production. The approach avoids dangerous situations associated with deteriorating asset performance.

  3. Digital Twin Aggregate (DTA). Analyzing one asset's performance is good, but several ones - even better. DTA enables enterprises to track the interactions between objects and implement new ideas to improve them. It could be about a few machines in a production hall or all items within a smart city.

Benefits and Value Of Digital Twins

Low operating costs. Identifying potential issues and fixing them at an early stage helps companies save on additional asset maintenance. Moreover, here digital twin software minimizes the risk of downtime, which can be costly to a business.

Reducing time to market. A company can create DTP and make advanced testing of digital analog. It helps identify significant defects, preventing failures in the future, and cutting time to market period.

Benefits and Value Of Digital Twins

Emergency prevention. Timely identification of equipment malfunctions saves employees' lives and a company's reputation. Due to digital twinning businesses keep it on the radar and provide a rapid response to any inconsistencies.

Flawless data transferring. Using digital twins leads to better integration levels and flawless data exchange. Sure, it would be difficult to perform without the Industry 4.0 technologies support. Anyway, DT it's a sort of catalyst accelerating the creation of a unified ecosystem in an enterprise.

Generating new ideas. Tracking the condition of resources prompts management to take new approaches to improve the current situation. It leads to a less risky and relatively fast digital transformation process.

Digital Twin Examples

Digital twins can be used in any industry. In manufacturing, they enable control hardware, in medicine - to carry out complex operations and make revolutionary discoveries, in retail - to improve customer experience and boost goods turnover. We've put together a few bright examples of how *digital twin applications* help businesses deal with various challenges.

Real estate & environment protection

Did you know that construction is one of the largest sources of carbon dioxide emissions? Here digital twins can do more than help build smart cities. They also might reduce air pollution. Using this approach, developers can optimize the design, construction, and further operation of facilities. Besides, green-oriented management is also applicable to existing houses. It is enough to place the sensors inside a building, collect all the necessary data, perform mathematical calculations and create an exact dynamic copy of the object. According to the E&Y report, using digital twins, developers can save up to 35% of project costs and cut carbon emissions by 50-100%.


Tony Shakib, Partner General Manager at Microsoft once said, “Digital twins is a powerful tool that can be used throughout retail — both in the supply chain and in-store.” Holy truth, since digital twins are also about phenomena digitization. Companies can recreate a dynamic supply chain model and analyze a range of factors: the degree of danger on the roads, the number of efficient directions, etc. It allows boosting the supply chain with surgical precision.

Also, why not create a digital twin of a store? Such an approach will make it possible to qualitatively track customer behavior, make predictions, and place goods on the right shelves. For example, using a digital twin retailer could create heat maps showing where shoppers spend the most time.

In the retail field, this tool solves one more crucial issue - tracking compliance with franchise requirements. Making a digital copy of a store becomes a lifesaver for the franchisor. It can monitor compliance, taking care of its brand reputation and uniqueness.


Unilever actively uses digital twin technology to support an appropriate environment in its manufacturing facilities. Thus, the company controls the operation of the equipment and optimizes the production process. The management forms a list of work scenarios and selects the best ones, minimizing the consumption of raw materials and simplifying staff operation.


As seen, the digital twins' concept is deservedly a widely discussed topic. The technology applies to almost all industries and wins over with the ability to do business flawlessly. But more importantly, the digital twin eliminates the fear of something new. Using this approach encourages companies to initiate meaningful changes and implement them on a tight schedule.

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