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A new DHL trend report forecasts the widespread adoption of the digital twin concept in logistics in the near future, a development expected to bring change to traditional supply chains.

The “Digital Twins in Logistics” report explains the concept and rise of digital twins as well as how it creates value. The technology, which involves using digital models to better understand and manage physical assets, is already well established in some industries and has the potential to significantly change logistics operations, it added.

A digital twin is a unique, virtual representation of a physical thing that monitors and simulates both the physical state and behavior of the thing. The digital copy is continually connected to the physical object and updates itself to reflect real-world changes. Applied to products, machines and even entire business ecosystems, digital twins can reveal insights from the past, optimize the present and even predict future performance.

“The market for digital twins is expected to grow more than 38 percent each year, passing the $26 billion mark by 2025,” explained Matthias Heutger, senior vice president, global head of innovation & commercial development at DHL.

“Digital twins offer unparalleled capabilities to track, monitor, and diagnose assets. They will change traditional supply chains, with a range of options to facilitate data-driven decision making and collaboration, streamlined business processes, and new business models,” he added.

The report observed how the engineering, manufacturing, automotive, and energy industries in particular are already using digital twins to create new value. Digital twins are “helping companies to design, visualize, monitor, manage, and maintain their assets more effectively” and are “unlocking new business opportunities like the provision of advanced services and the generation of valuable insight from operational data.”

In logistics, digital twins could be used in a variety of applications along the entire value chain, including the management of container fleets, monitoring of shipments or the design of logistics systems.

Internet of Things (IoT) sensors on individual containers, for example, show their location and monitor for damage or contamination. This data flows into a digital twin of the container network, which uses machine learning to ensure that containers are being deployed as efficiently as possible.

Digital twins can be applied not only for individual assets but entire networks and ecosystems such as warehouses, combining a 3D model of a facility with inventory and operational data. The system would be able to provide an overview of the state of machines and product availability and could make predictions and autonomous decisions about stock or deliveries. The same principle applies to major logistics hubs or global logistics networks.

Markus Kückelhaus, vice president, innovation and trend research, DHL Customer Solutions & Innovation, added: “Powered by IoT, cloud computing, artificial intelligence and advanced visualization tools, digital twins are becoming a more attractive and accessible option for companies.”

However, he added, bringing these and other relevant technologies together into a full digital twin implementation is a complex and challenging task. “Close collaboration between all partners along the value chain is therefore essential to fully capture the potential,” he said.

In the report, DHL examines the challenges to implementation, such as cyber security concerns, but stresses that business cases for implementing digital things are becoming more compelling. “As related technologies get to be more dependable and affordable, businesses in a number of industries will find digital twins invaluable in managing complex systems of assets in real time and increasing efficiency in their processes.”

Photo: Sambeet D

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