November 2018 paper on 'Service business model innovation: the digital twin technology' by Veronica Martinez, Audrey Ouyang, Andy Neely, Caroline Burstall and Dav Bisessar
The rise of the digital technologies such as digital twins, the internet of things (Industry 4.0), augmented reality, machine learning among others, provide new platforms and avenues to enable services and innovate service business models. Digital Twins (DT) are one the most promising state-of-the-art digital platforms. They create digital/virtual twins of the physical assets. The majority of DT research focuses on the engineering and data transmission of this platform and less on the applications. Little is known about how DTs are integrated into the firms’ operations and their impact on firms’ business models. Considering the importance of this emergent topic, it is of paramount importance to study the effect of Digital Twins on service business model innovation. In other words, what effect do digital twins bring to existing service business models? A two-phase exploratory research was set up to understand this research enquiry. Phase One focused on the overall understanding of how DTs are set, implemented and used. 37 interviewees across three large industrial engineering firms, in addition to two DT platforms architects. Phase Two focused on the study of the context of the use and effect on the firms’ service business models on three pairs of cases. Our research shows four generic types of service business models founded on the DT platform and their trajectories.