Sales and Fulfillment
Integrating digital twins in value chain optimisation: Revolutionising efficiency and performance
In today’s dynamic and increasingly complex marketplace, even the slightest disruption or supply chain bottleneck can have significant consequences. Whether it is delivery delays due to supply chain disruptions or lost customers due to stockouts, businesses cannot afford to slip up as the changing customer expectations and rising competition mean they will lose business. Leveraging technology for supply chain optimisation and digitisation is critical for any business to stay responsive, efficient, and successful today.
Understanding digital twin technology
The advent of technologies like IoT, blockchain, AI, augmented reality, and RPA have played a key role in digitising modern supply chains, helping businesses transform their supply chain operations. One such groundbreaking advancement that offers unparalleled supply chain visibility and facilitates data-driven decision management is supply chain digital twins.
As a core element of Industry 4.0, this technology creates virtual replicas of assets, processes, and systems, offering real-time insights into supply chain dynamics. Digital twins go beyond a simple simulation of the supply chain or conventional static models, relying on real-time data for comprehensive visibility, proactive risk management, and continuous optimisation across supply chain and value chain efficiency.
Supply chain digital twins use cases
With the 360-degree view digital twins offer of the supply chain network, it offers immense possibilities across different industries, including manufacturing, aerospace and defence, logistics and warehousing, CPG, and more. As a result, the global supply chain digital twin market is set to grow at a CAGR of 12% between 2024 and 2033, reaching $7.8 billion by 2033.
Some of the common use cases of digital twin integration across different industries include:
Predictive maintenance
Various equipment is an integral part of modern supply chains from production lines to distribution network. Digital twin technology can leverage AI and machine learning models to monitor equipment behaviour in real time, offering insights into maintenance requirements. This way, you can schedule maintenance to reduce unplanned downtime and improve overall value chain efficiency.
Quality control
Supply chain digital twins also facilitate real-time monitoring across the production processes to ensure consistent quality control. Tracking any deviations in product specifications, digital twins can suggest and implement immediate corrections to reduce waste and strengthen the overall supply chain.
Equipment effectiveness optimisation
Equipment effectiveness encompasses the availability, quality, and overall performance of physical assets across the supply chain. Digital twins can help identify the root cause for any performance or availability inefficiencies and recommend strategies to alleviate these issues to increase uptime, optimise utilisation capacity, and reduce defect rates. For example, a leading aerospace and defence company leverages digital twin technology to simulate the peak performance of aircraft engines in different conditions and identify areas for improvement to optimise performance.
Demand forecasting
Digital twins also analyse consumer behaviour, market trends, and other data from different supply chain pillars for more accurate and dynamic demand forecasting. For example, leading retailers are using IoT sensors, point-of-sale systems, and other enterprise systems to create virtual inventory models for better stock management, inventory optimisation, reduced overproduction, and inventory cost optimisation for overall supply chain optimisation.
Proactive contingency planning
Digital twin integration can help model complex supply chain networks, helping businesses identify potential bottlenecks or external disruptions that can impact supply chain performance. Insights from this analysis can facilitate contingency planning for a resilient supply chain.
Route optimisation
Simulating various distribution scenarios, digital twins can also facilitate route optimisation for lower fuel costs and faster delivery times. For example, a global shipping company is using digital twin technology, GPS, and IoT sensors to track their containers in real time, helping the company reduce losses, optimise its supply chain, and provide better customer service.
Storage layouts optimisation
Replicating warehouse operations in digital twins can also help companies maximise storage layout utility for an enhanced picking process and optimised warehouse operations. For example, a leading logistics company is using sensors and cameras to monitor and replicate the movement of goods in the digital twin of their warehouse to not only optimise warehouse layout but enhance the overall order processing.
Although there are implementation challenges, including high initial investment, the need for specialised expertise, and integration with existing enterprise systems, the benefits of digital twin integration are significant. It can be a critical game changer when it comes to supply chain optimisation and help companies build a sustainable competitive edge.
How can Infosys BPM help with digital twin integration?
Focusing on supply chain optimisation is critical for building responsive and agile supply chain networks. Infosys BPM digital supply chain services can simplify your journey towards a streamlined and digitised supply chain with specialised solutions, including supply chain diagnostics, inventory optimisation, forecasting-as-a-service, and more. Leverage our end-to-end solutions to transform your supply chain with digital twins and enhance value chain efficiency while being cost-competitive.
