Digital Twin Success for Machine Builders: Part Four
Generating Revenue
Aside from the benefits we discussed in the first part of our series, machine builders should also consider digital twins as a means to generate revenue and enhance their product offerings.
This article explores how machine builders can leverage digital twins as standalone products, the cost considerations involved and the long-term financial and strategic benefits.
Selling Digital Twins as Standalone Offerings
Digital twins, which are virtual replicas of physical assets, offer machine builders a unique opportunity to create high-profit, low-maintenance digital products.
By selling digital twins as standalone offerings, machine builders can provide their clients with valuable tools for simulation, testing and optimization without the need for physical prototypes.
High-Profit, Low-Maintenance Digital Products
A digital twin provides multiple levels of value from the perspective of the machine builder to a client, including marketing, reviewing assets and reducing commissioning risk. Unlike physical products, digital twins have low maintenance requirements and do not require manufacturing, shipping, or physical maintenance, reducing overhead costs.
By offering digital twins, machine builders can also enhance their clients' ability to visualize and interact with their machinery in a virtual environment.
This capability allows clients to experience the equipment's functionality and performance without the need for physical access, making digital twins an attractive and cost-effective solution.
Development Cost Considerations
When comparing the development costs of digital twins to physical products, several factors come into play.
Digital twins typically involve:
- Lower upfront costs
- Shorter development timelines
This makes them a cost-effective alternative to traditional physical prototypes.
Comparing Digital Twin Development Costs to Physical Product Costs
The development cost of digital twins is generally lower than that of physical products. For example, if you're spending $200 million on a factory or a line, it makes sense to spend less than 1% of that on virtually commissioning it to reduce your risk. This cost efficiency is due to the reduced need for physical materials, labor and testing associated with digital twin development.
Additionally, digital twins enable faster testing and iteration cycles. For example, an organization can run ten times as many tests in two weeks compared to the twelve weeks required for physical testing. This accelerated testing process not only reduces costs but also minimizes the risk of production delays and equipment failures.
Long-Term Financial and Strategic Benefits
The long-term financial and strategic benefits of digital twins extend beyond immediate cost savings. By integrating digital twins into their product offerings, machine builders can achieve significant improvements in operational efficiency, customer satisfaction and competitive advantage.
Enhanced Operational Efficiency
Digital twins enable machine builders to optimize the performance and maintenance of their equipment. By providing real-time monitoring and predictive analytics, digital twins help identify potential issues before they become critical, reducing downtime and maintenance costs. This proactive approach to equipment management enhances overall operational efficiency and extends the lifespan of the machinery.
Improved Customer Satisfaction
Offering digital twins as part of their product portfolio allows machine builders to deliver greater value to their clients. Organizations benefit from the ability to simulate and test equipment in a virtual environment, leading to better-informed purchasing decisions and more effective training for operators. This improved customer experience translates into higher satisfaction and loyalty.
Competitive Advantage
Incorporating digital twins into their offerings positions machine builders as innovative leaders in the industry.
This includes:
- Meeting End-User Expectations: End users are increasingly expecting machine builders to include digital twins in new projects and RFPs to demonstrate their capabilities. Early adoption of this approach may enable machine builders to remain competitive.
- Optimizing Processes: Digital twins can be used for process and mechanical optimization, such as improving throughput in line with EU requirements or validating new machine designs.
By staying ahead of technological advancements, machine builders can differentiate themselves from competitors and attract new clients seeking cutting-edge solutions.
Conclusion
Digital twins offer machine builders a powerful tool for generating revenue and strategic growth. By selling digital twins as standalone products, machine builders can capitalize on high-profit, low-maintenance digital offerings. The cost advantages of digital twin development, combined with the long-term financial and strategic benefits, make digital twins an essential component of a modern machine builder's product portfolio. As the industry continues to evolve, embracing digital twin technology will be crucial for maintaining competitive advantage and driving innovation.
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