From “Egosystems” to Ecosystems: IDC Reveals the Transformative Power of Digital Twins Across All Industries

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• Marco Tennyson  Email: mtennyson@idc.com  Phone number: +39 02 28457.1

MILAN, April 18, 2024 — In the rapidly evolving landscape of Industry 4.0, digital twin technology stands at the forefront of innovation, revolutionizing the way industries operate and paving the way for the seamless integration of artificial intelligence. This advancement heralds a significant shift towards Industry 5.0, emphasizing a deeper collaboration between humans and machines.

Digital twins serve as an advanced virtual representation of physical assets, processes, or systems, offering an unparalleled real-time glimpse into their operations. These dynamic models mirror the life cycle of their physical counterparts, providing an accurate, synchronized view that goes beyond a mere static representation.

“In today's industries landscape, digital twins are emerging as indispensable tools for forging paths to success. From fostering intelligent collaboration to testing and predicting the success of groundbreaking ideas, digital twins are key to unlocking competitive advantages,” says Silvia Piai, research director, IDC Health Insights Europe, and co-lead of IDC's Industries Digital Twin Taskforce.

IDC research highlights the widespread adoption and recognition of digital twin technology across various sectors, extending its reach far beyond the traditional, asset-heavy industries. A comprehensive survey conducted by IDC reveals notable familiarity with digital twins in resources and construction (52%) and manufacturing (40%), but also in professional services (40%), transportation and logistics (37%), energy (37%), and finance (36%). This broad applicability underscores the technology's role in enhancing operational efficiency and decision-making in cross-industry ecosystems.

The impact of digital twins is set to expand significantly, with IDC forecasting that by 2027, 35% of G2000 companies will employ supply chain orchestration tools featuring digital twin capabilities, with the aim of boosting supply chain responsiveness by 15%. Furthermore, by 2029, it is expected that 80% of auto insurers leveraging digital twin technology for claims processing will focus on accident recreation, potentially reducing casualty claims adjustment expenses and fraud losses by 40%.

As new use cases continue to emerge and digital twin projects grow in complexity and reach, organizations need to define their course with strategic clarity for a future of boundless possibilities. The transition to interconnected ecosystems necessitates a comprehensive approach to digital twin strategy development, spanning from individual entities to the entire ecosystem.

Recognizing this need, IDC has developed a robust framework to guide the formulation of digital twin strategies across various industries. This initiative seeks to empower businesses to leverage digital twins for competitive advantage and operational benefits, affirming their relevance in asset-intensive sectors like manufacturing, as well as such industries as insurance, healthcare, and transportation.

IDC's Cross-Industry Digital Twin Framework encourages a strategic shift from “egosystems” to holistic ecosystems, ensuring that digital twin strategies are thoughtfully developed to cover all bases with an end-to-end approach.

To explore this new framework and delve deeper into developing a comprehensive digital twin strategy, download our latest eBoo k here.

About IDC Industry Insights

IDC's industry research assists business and IT leaders in making technology decisions across six industries — retail, government, financial services, manufacturing, health, and energy. It also helps technology suppliers inform their vertical marketing, sales, and product management strategies so that they more closely align with key industry-specific trends and investment priorities.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,300 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on X at @IDC and LinkedIn. Subscribe to the IDC Blog for industry news and insights.

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