Sustainable competitive advantage through the implementation of a digital twin

Abstract

This chapter discusses how and under what conditions firms implementing digital twins can build a sustainable competitive advantage. A digital twin refers to a precise virtual copy of a machine or system that can be utilized across a wide range of corporate operations. However, the digital twin can be a major investment, and companies need to know which operations to focus on in the long run and what type of competencies are needed to succeed in the implementation and use of a digital twin. Therefore, the primary contribution of this chapter is its construction of a multidimensional model for managing a digital twin-driven operation based on insights from multiple disciplines and the dynamic-capabilities view of the firm. The model illustrates the interplay between company competencies, strategic direction, and sustainability performance in the implementation of a digital twin. Further, nine propositions related to requisite competencies and the strategic direction of digital-twin implementation are offered.