Who Will Win the Digital Twin Services Race?

Posted by Joe Perino on Thu, Jan 17, 2019

The Digital Twin market is evolving fast – yes, it affects strategies of independent software vendors and automation vendors. But, it also has significant implications for field service providers, engineering, procurement, and construction (EPC), and process licensors. It’s quite surprising to see how many different types of companies could be or are already involved with Digital Twin.

Digital Twin Marketspace

This got me thinking about the broader picture of all the services associated with Digital Twins: who does what, where and when, and who will have the opportunity to lead the services business. I won’t address everyone on the list, but let’s highlight some of the key players and those with significant business opportunity. Each of these companies have a services arm, and some occupy more than one category.

  1. Independent software vendors - AspenTech, AVEVA, Bentley, GE Digital
  2. Startup technology companies (as opposed to established vendors) - C3, Uptake
  3. Automation companies - ABB, Emerson, Honeywell, Schneider, Siemens, Rockwell, Yokagowa
  4. System integrators - Maverick, Rovisys, Wood Group
  5. Equipment manufacturers - Flowserve
  6. Big technology companies - IBM, SAP, Oracle, Microsoft, Google, Amazon
  7. Consultants, some of whom are also software and application providers - Accenture, Deloitte, DNV, Infosys, and KBC
  8. Specialized industry services companies such as oilfield services
  9. EPCs, some of whom are also process licensors - KBR, CB&I, Technip, WorleyParsons
  10. Process licensors - Axens, UOP, Haldor Topsoe, Fastech, GTC
  11. Operating companies, who are also process licensors - ExxonMobil, LyondellBasell, Shell
  12. Operating companies - DIY

Independent Software Vendors and Automation Companies

The independent software vendors and the automation companies are committed players. While the automation companies already offer lifecycle services, the ISVs supply the product lifecycle, engineering, and process design models, with some focus on equipment reliability. But software and services business models are different. So, will the ISVs tackle the end user services market directly or go through other service providers as channels?

System Integrators

System integrators, close followers of the automation companies with their knowledge of control systems and operational systems, could join in too. Can they handle the necessary commitment to end users?

Big Technology

Big technology companies offer most of the components needed to build and support Twins, including advanced analytics, Industrial Internet of Things (IIoT), and Cloud platforms; plus, their global size and the reach to support large end-users wherever they operate, make them a formidable player. It’s a near certainty that they will play a role in the operational architecture in which Digital Twin will run.

Consulting Firms

Consulting firms are a diverse lot, with some focusing on the ERP, supply chain and trading areas, while others go much deeper into operational technology (OT) and manufacturing execution systems (MES). Most will use the independent software vendor’s software combined with their services, but a few have their software, and so in a unique position to build and service Twins. Moreover, the consulting firms will want to shape and manage Digital Transformation programs.

EPCs and Process Licensors

Until now the EPCs and process licensors have been quiet in the Digital Twins market. EPCs who are substantial users of the ISVs design, engineering, and process modeling tools, have an opportunity to extend their services throughout the asset lifecycle of the very plants they design and build. Also, many are process licensors, who can offer Digital Twin services with every license they sell. One would think that like the EPCs, the process licensors are in the cat bird’s seat to sell Twins services with every license, and since they will be linked to the actual operating plant, can close the process design feedback loop. Can the EPCs and process licensors be at the center of these Twin services, acting as the hub between ISVs, automation, equipment suppliers, and the end user?

Finally, what about the operating companies themselves? Except for only the largest companies, most will not have the personnel available let alone the ability to handle Digital Twins by themselves. That leaves the majority driving the race car, but the car’s designer, builder, and pit crew will be third-party services.

The Digital Twin market is still very much in its infancy, so this will be a significant aspect of Digitalization that is sure to be worth following. LNS sees this as a substantial services market in the years ahead. Stay tuned for more on our research on Digital Twin coming out this spring 2019.

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Categories: Asset Performance Management (APM), Digital Twin