A digital twin is a complete digital replica of a physical asset (such as an airplane) or real-world process, such as a factory or supply chain. For supply chains, the benefits of having a digital twin are profound. Because it mirrors the supply chain’s assets, transactions, third-party relationships and other operational details, the digital twin enables sophisticated real-time monitoring and adjustments. It brings a broad and deep view of your supply chain, allowing companies to quickly model potential scenarios involving shifts in manufacturing lines, the availability of assets and people and adjustments to distribution flows or proactive risk monitoring.
The digital twin enables you to run a parallel version of the supply network containing the same supply entities, parameters and financial targets to sense problems and responds to support prescriptive decision-making. This helps management make rapid decisions with a high-degree of confidence in outcomes.
As companies consider how to ramp up operations or even transition mass production to smaller, more customized manufacturing, digital twin can help them make supply chain decisions that will enable competitive agility and align with customer preferences. A prime example is the use of digital twins capable of creating optimized production schedules with high-speed agility to respond to events in real time. Legacy planning systems are simply outmatched by this inherent complexity and the “need for speed” in response.
Learn more about digital twin technology in supply chain by watching this on-demand EY webcast on real-time visibility.
A supply chain for customers of the future
Customer behavior is changing, and given the COVID-19 pandemic, transparent and real-time information are becoming critical to ensure health and safety. This information will need to go beyond the sourcing of product ingredients, to letting customers know where their product has been, where it is on the shipping route and exactly when it will be delivered. Having end-to-end visibility to identify disruptions across your supply chain is critical to synchronize what is expected against what is actually taking place.
Due to COVID-19, we are also seeing a shift in overall customer sentiment around privacy. Our EY Future Consumer Index shows that 53% of consumers would make their personal data available if it helped to monitor and track an infection cluster. Companies should consider how changes in future behaviors and sentiment will impact their business model and create new opportunities. It may accelerate the demand we see already for greater product traceability through new technologies, such as digital twin.