The next big opportunity : Logistics Digital Twins

Manufacturing Digital twins are becoming the new normal fast

Chances are that every time you hear about Digital Twins, it is in the context of Manufacturing. Rapid developments in the domain of Big Data and sensor technologies, in tandem with advances in the field of IIoT technologies have led to advancement of Digital Twins, but the focus has primarily been on application in manufacturing. If you follow the Smart Manufacturing trend, you know that there are a multitude of “Lighthouses” – model factories that already have robust Manufacturing Digital Twins. Ecosystems and platforms are being developed at a rapid pace and significant research has been done in this area.

Logistics Twin is the next logical step

Like Manufacturing Digital twins, if Logistics assets are equipped with a comprehensive sensor system, and the data generated get leveraged by a cloud Digital Twin platform, a Digital image of the respective logistics object can be created, where real time data exchange happens between the actual physical object and the Digital Image. This is the vision that I have in my perspective of a Logistics Digital Twin.

You will rarely find content on Logistics Digital Twins even when you try searching for it. One key reason behind that in my mind is that there is a lack of concrete use cases of Digital Twins in Logistics domain. In terms of implementation, Logistics Twin will be more difficult to implement, considering the “movement heavy” nature of the function. Unlike manufacturing, Logistics assets travel far and wide, movement is the crux of this function and more comprehensive architecture is required. However, I strongly believe that once developed, it can provide a capabiity that will be many X times that from a Smart manufacturing setup, specifically for companies that are primarily Logistics and Distribution based.

Is the technical architecture much different from Manufacturing twins ?

We know that Logistics functions of large organizations generate a vast amount of data, which is mainly generated by controlling and monitoring large quantities of flow of goods. This data holds considerable potential in terms of visibility, optimization, risk management and control of Logistics function.

Note that the value of the data generated is not measured by the amount of data collected but by the applications made possible by the data. Making use of this data requires a substantial and valid data basis. Remember that Data collection is no longer a challenge in this age of cheap sensor technology and open source applications. The key is to understand how this data is leveraged.

The summary is: The technical architecture required is not significantly different or complex vs Manufacturing Digital twin.

What capabilities can Digital Twins provide ?

As mentioned above, data collection and processing is the not the key aspect of a Digital Logistics twin – what you do with the data is what provides you unique capabilities. Unique capabilities are capabilities that your competitors does not have, that need significant development and time to build, which will make sure that your competitors will always be years ahead if they want to catch-up. These are the types of capabilities that you can call Game Changing.  Some examples of  capabilities that Digital Logistics twins can provide are:

(1) Real time monitoring

The definition, calculation and visualization of KPIs, in my perspective, is the central analysis function of a Digital twin system. KPIs generated by Digital Twins can enable companies to quickly determine the condition of their assets and the efficiencies of their processes. Three steps are required to define and store a new KPI function for a specific scenario:

  • Implementation of the KPI function
  • Implementation of KPI visualization
  • Adding a semantic description to a KPI record/event

(2) Real time planning

I am a not a big fan of plain monitoring if you can’t take real time corrective action to course correct.This is where Machine learning models can be really useful. Imagine a scenario where an algorithm detects that a shipment has got stuck due to a natural disaster. It can then locate the next shipment, which can be expedited in the most cost efficient way, to make sure that there are no disruptions due to that lost shipment.

(3) Cognitively Smart Logistics planning systems

(2) above essentially creates a foundation on which organizations cn then start building and testing a “self correcting” and mostly autonomous Logistics function. Good news is that building a true Digital Twin in itself is a time consuming process that in my perspective will take 3-5 years for a large company with complex distribution network. So by the time companies have developed the real time planning aspects indicated in previous section, they will have enough mature cognitive open source platforms to build a “Cognitively Smart” Logistics planning system.

(4) Continuous improvement

Performing analysis on historical data from Digital Twin combined with insights from real time scenarios will help you identify bottlenecks in your processes. The continuous improvement process becomes significantly easier, not only in identifying the opportunities but also in terms of observing impact of improvements made.

(5) End to end Supply Chain integration

Combining Digital twin in Logistics with Manufacturing and warehouse Digital Twins, encompassed with a control tower will provide you an end to end visibility into your Supply Chain. Imagine the end to end optimization opportunities once you have this visibility.

(6) New products and services

This is the most important and truly fits in the bucket of “Game changing” aspect that I mention frequently in my posts. Since every company in every industry can create a different product or service, I can’t quote a specific example here but you need to believe my word when I say that this is what will provide the true “competitive edge” that I keep on talking about. As an example, if you are a Grocery Wholesale Distribution company, the only way to build a capability that will help you survive and thrive next two decades is to build this capability of a true Digital Twin of your network. Once it is in place, you can enhance the scope of your services significantly.


Views my own.



Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s