Image source: Microsoft Copilot Designer

Leaders’ Note
As technology leaders, we are at a critical juncture where large-scale technology
convergences, be it smart manufacturing, autonomous vehicles, or smart cities, are
being envisioned, planned, and delivered using advanced digital simulations, or Virtual
Twins. The transformative potential of virtual twin technology, enabled by cutting-edge
integration of IoT, AI, Cloud, connectivity, and visualization, is poised to revolutionize the
design-to-decommissioning journey of products, processes, and even the most complex
systems.

If early twins enabled virtual mirroring, monitoring and optimization of individual assets,
today’s virtual twin technology offers generative design, immersive experience modeling,
and decision provenance of not only a single asset, but of dynamically networked system
of systems, by emulating complex physics and contextual behavior.

Virtual twins offer unprecedented levels of insights and controls through “what-if”
scenario-building to enable real-time monitoring, diagnostics, and predictive
maintenance in a relatively low-cost and risk-free environment. Further, virtual twins
enable critical data and design continuity and provenance of all decisions, crucial
requirements for creating truly sustainable and circular product lifecycles. In
manufacturing, for instance, virtual twins can maintain human-led process lines, while
helping design and realize sustainable, autonomous factories of the future, with the
ability to retrace all digital shifts made by an entire value chain over time.

While the future scope is expansive and promising, current adoption of virtual twins has
been relatively restricted due to challenges in integration of diverse and historical data
sources, interoperability of disparate systems, limited talent availability in simulation and
modelling skills and expert skills requiring IT with engineering and domain knowledge,
and quite pertinently, lack of clear leadership vision and success metrics.

Providers, particularly specialist suppliers of next-gen 3D simulation and experience

capabilities, have a crucial role to play in helping organizations understand, plan,
prepare, and execute virtual twins where most feasible and impactful. With our joint study
of 130 global enterprises across four major industry segments and five major
geographies worldwide, we aim to unravel the mindset, capabilities, and gaps in virtual
twin adoption today. We hope that our readers find the insights useful. Do write to us
with your feedback on [email protected].

Achyuta Ghosh Deepak NG

Senior Director and Head of Research Managing Director, India
nasscom Dassault Systèmes

2
Contents

Executive Summary 4

The Business Case for Virtual Twins 6

Virtual Twins – Global and India Adoption Trends in 2024 14

Virtual Twins for Sustainability Goals 25

Appendix 30

3
Executive Summary

Virtual twins are a digital version of physical assets created using software, IT -OT
hardware, and connectivity to manage the asset through stages of its lifecycle.

1. Virtual twins are digital representations or twins of a real-world product,

process, or system in structure, context and behavior.

2. Virtual twins can generatively design and manage entire product

lifecycles, from past to future, enabling data and decision continuity.

3. Virtual twins integrate general and advanced software, IT-OT hardware, and
connectivity tech to enable near real-time interaction with physical assets.

Virtual twin trends reveal high awareness and doubling of adoption since the
COVID-19 pandemic.

4. 90% of the global enterprises have explored at least one virtual twin PoC.

5. 2X virtual twin implementations during 2020-2023, compared to 2014-2019.

Current intensity of spending on virtual twins offers massive scope for market share
and depth capture, led by focused use case guidance from specialist providers.

6. 80% of companies report inadequate levels of digital and process

automation maturity necessary to start and scale virtual twins effectively.

7. Just 24% enterprises allocate 10%+ of their tech spend to virtual twins,
even as at-scale virtual twin use cases can deliver up to 50% efficiency gains.

8. 2-in-3 enterprises struggle with use case selection, considered most critical
for successful PoCs and eventual scale-ups.

9. 67% implementations are restricted to single product or process twins, with

limited RoI success, despite 4-5 years on average since the first PoC.

4
Enterprise choices with use cases, tech stack investments, and suppliers reveals an
urgent need for specialist advise on strategic planning and execution of virtual twins.

10. 60% enterprises are uncertain about the relevant twin tech stack across
software, IT-OT hardware, and connectivity tech, leading to PoC paralysis.

11. 75%+ companies reveal difficulties in procuring and implementing

software, and end up trying a variety of suppliers, with no clear supplier
strategy.

12. 45% enterprises report spending 12-24 months on implementing virtual twins
at any stage – product, process or system – due to ad-hoc supplier selection.

Top leadership commitment, data and skills readiness, and a constant focus on costs
is key, as revealed by the differentiating performance of mature adopters.

13. Only 22% companies report top leadership, CXO-level, vision and
management of their virtual twins initiatives.

14. Virtual twin scale-ups will require effective handling of data, tech
integration, skilling, organizational readiness, and cost management aspects.

15. 20% of enterprises reported high levels of digital and process automation
maturity, and yet these firms struggle to scale-up virtual twin projects.

16. Systemic nature of roadblocks – in data, skills, tech, and cost – offers
significant opportunities in consultative selling for specialist providers.

Sectoral and regional variations are few due to the still -emerging technology.
However, there is rapid growth in virtual twins for sustainability goals.

17. Indian enterprises are beginning to explore virtual twins, and like global
counterparts, focus on product and process stages, and supplier selection.

18. With estimated $1.3 Tn of economic gains and 7.5 Gt of CO2 emissions
reductions by 2030, virtual twins can unlock major sustainability gains

5
 The Business Case
for Virtual Twins

Image source: Microsoft Copilot Designer

6
The Business Case for Twin Technology
Industrial enterprises have been utilizing structure, context, and behavior of bigger
tools and techniques to digitally simulate and more complex physical systems
physical products, machinery, process lines, through digital. Experts indicate that single-
and factories for a long time to minimize the entity “in real-time” twins, therefore, are
cost and risk associated with design, rapidly evolving into more contextualized,
operations, and innovation. Digital connected, and behavior-led,
simulation-based asset monitoring, representations of the past, present, and
potential future, and are being termed
maintenance, and new deployments have
“Virtual Twins”.
accelerated rapidly after the COVID-19
pandemic, and increasingly, non-industrial
entities, such as banking, insurance, and
What are Digital and Virtual Twins
retail companies, have made forays into the
world of virtual simulations. Gartner defines a digital twin as a digital
representation of a real-world entity or
system, which comes in the form of a
Since the emergence of the first simulation ‘software object or model that mirrors a
techniques in the 1960s in military and space unique physical object, process,
applications, to the coining of the term organization, person or other abstraction’.
“Digital Twins” by Dr. Michael Grieves of In short, digital twins are computer-based
University of Michigan in the context of models of a physical product, process or
system. Digital twins can be at a component
product lifecycle management (PLM), the
level, or for a product, a process, or a
concept of digital simulation has not only
complete system of operations.
gained prominence but has expanded multi-
fold as a strategic approach to large-scale
digital transformation of industries and Virtual twins are advanced, extensible, and
value chains. responsive digital replicas with real-time
representation of behavior and interactions
that physical systems have along with the
With customer-centricity becoming deeply
history of decisions and variants related to
intertwined with design and co-creation,
that physical system. A virtual twin
smart and hyper-automated customer
represents a product or system as it exists
journeys are redefining the contours of
now, but also how it was designed, tested
competitive differentiation – from go-to-
and manufactured in the past, and how it
market (GTM) agility to hyper-
could be operated and maintained in the
personalization at affordable cost. For
future, thus providing provenance and
enterprises, this entails constantly
prediction through the asset and systems
evaluating multi-scenario “what-if”
lifecycle.
exercises to optimize the

Sources: Gartner, Dassault Systèmes, nasscom analysis.

7
Evolution of Virtual Twins

Plethora of tools, technologies, and implementation methodologies introduced in programming,

web and user interface design, simulation software, product lifecycle management, artificial
intelligence, sensortech, and communications since the early 1900s have eventually brought to
life one of the most complex technology convergences of its kind, the virtual twin technology.

Evolution of Virtual Twins – An Illustrative Journey

1900 – 1950s Tech Foundations

Tech Foundations

▪ Digital signal processing with Nyquist sampling

▪ MIT’s Whirlwind I, the first computer supporting real-
time simulation
▪ Artificial Intelligence (AI) term coined

Birth of PLM and 1960 – 1990s

Simulations Birth of PLM and Simulations

Did you
know?
▪ Sketchpad, the first graphical user interface (GUI)
and early computer-aided design (CAD) program The top three
launched in 1963 global
▪ NASA uses ground-based physical simulation of in- leaders of
space Apollo 13 craft for safe return to Earth using specialist
Earth-space communication in 1965 virtual twin
▪ Boeing 747 designed using early CAD tools in 1977 solutions in
▪ Interactive aided 3D design software, CATIA, 2024 began
created in 1981 operations
▪ Product Lifecycle Management (PLM) introduced in during this
1984 to integrate data and processes period
▪ Proprietary 3D digital mockup (DMU) of a physical
product introduced
▪ First finite element analysis (FEA) software in 1994
brings physics to simulations
▪ Internet of Things, IoT, coined in 1999
▪ Proprietary 3D PLM software introduced in 1999

8
 2000 – H1 2024
Virtual Twins
Virtual Twins

▪ Digital Twins software concept introduced by Michael Greeves in 2002

to be applied in PLM
▪ Web 2.0 introduced with interoperable, modular architecture components
(for user interface)
▪ Elastic Compute Cloud (EC2) from Amazon Web Services (AWS)
launched with scalable cloud computing and cloud-premise data
communication technology
▪ Proprietary 3DExperience business experience platform launched in 2012
▪ Related Gartner Emerging Tech Hype Cycle introductions since 2010 –
gamification, machine-to-machine communication services, software-
defined anything, complex-event processing, IoT platforms, virtual reality,
self-healing systems, AR cloud, 3D sensing cameras; and after 2020 –
5G/private 5G, composable enterprise, citizen twin, digital humans,
physics-informed AI, customer twin, AI simulation, hyperautomation

9
The Elements of a Virtual Twin Technology
Virtual twins are the product of convergence of multiple technologies applied to integrated IT-
OT use cases. There are three core technology pillars – software applications, IT-OT hardware,
and connectivity technologies – that make virtual twins come to life. By capturing
Sources: Multiple weband emulating
sources, nasscom analysis.
physical asset behavior, in addition to its 3D structure and context, virtual twins evolve along
with the physical asset over the lifecycle, thereby ensuring that the critical elements of
provenance and continuity are managed.

Core Technology and Design Pillars of a Virtual Twin

Software Applications

▪ Digital manufacturing applications/ OT software – MES, MPS

▪ Analytics, AI/ML, Gen AI platforms
▪ High-def 3D CAD/CAE
▪ Automation/ HMI software
Technology Pillars

▪ Hardware-enabling softwareHardware-enabling software

IT-OT Hardware

▪ IaaS/ Twin cloud

▪ IoT systems and platforms
▪ Software-enabled hardware

Connectivity Technology

▪ Industrial IoT
▪ PLC/SCADA connectivity
▪ Cloud-to-edge communication
▪ High-fidelity networks, such as 5G/6G

Structure

▪ 3D structure recognition
▪ Multi-dimensional object extraction
▪ Model convergence
Design Pillars

Context

▪ Space-time alignment
▪ Virtual twin connection with physical
▪ Federation of twins
▪ (Near) Real-time updates

Behavior

▪ Behavior rule automation

▪ Resource optimization
▪ Product/ system lifecycle management

10
 As virtual twins evolve into more stable, reliable, and dependable models for automatic action
by the virtual for the physical, the twin technology is expected to become more autonomous
through federation and as-a-service adoption.

Stages of a Virtual Twin Creation

Highest level, evolving complexity Virtual Twin-as-a-Service

Near autonomous management of virtual twin lifecycle
through historical, current, and future states of the
system of twins

Federated Virtual Twins

Interconnections across virtual twins in a process,
system, or system of systems at multiple layers of
collaboration needed by the complex system

Virtual Behavior Modeling

Assessment, prediction, and manipulation of physical
object changes by simulating “What-if” scenario-based
changes in the virtual twin

Virtual Twin
Real-time synchronization between the physical and the
virtual objects based on data from structure, context,
and dynamic behavior

Virtual Simulation
Optimization of structure and context-based
performance of a physical object using virtually
simulated performance data, often in quasi real-time

Virtual Mirroring and Monitoring

Virtual replica of a physical 3D object in structure
and through transmitted sensor data

First level, lowest complexity

Sources: IEEE, Dassault Systèmes, nasscom analysis.

11
Global Adoption Trends in Virtual Twin Technology

Capgemini Research Institute, in a 2022 estimate that the approximate share of

study, estimated the market size for virtual revenue derived from services-based
twins, which exceeded $5 billion in 2020, to businesses is going to rise from the
grow at over 35% CAGR between 2021 and current 41% to 53% by the end of the
2027. decade. Business model shifts can be
challenging endeavors requiring people,
Several factors – deeper digitalization of talent, market, and business risk
industries, connected supply chains, more assessments based on several “what-if
advanced technology at declining TCO, scenarios”. Virtual twins have been
hyper-personalization of product portfolios, found to be crucial in enabling predictive
and increasing socio-environmental business and prescriptive guidance before
consciousness – are the major shifts in actioning real-world changes.
business focus driving up the adoption of
virtual twins. ▪ Heightening Focus on Managing
Dynamic Risks with Tech
The 2024 Global Risk Report by World
Tailwinds Supporting Virtual Twin Tech Economic Forum indicates that there is
a net negative outlook for the world, with
▪ Rising Digital Spend and Deepening a 6X higher anticipation of “stormy or
Digital Convergence catastrophic risks.” Virtual twins can be
An early 2024 study of nearly 550 end- particularly beneficial in anticipatory
user enterprises by nasscom revealed responses through predictive and
that digital spend has grown positively prescriptive modelling and simulation of
over the last five years, since 2020, risk and response behaviors.
despite slowing growth in tech spend,
suggesting that digital accounted for ▪ Systemic Shift to Sustainable, Circular
greater share of total tech spend even Businesses and Economies
as companies tightened their tech Rising VUCA is also driving enterprises
budgets majorly in 2022-23. to rapidly endorse sustainability and
circularity goals as core business
Further, the study revealed that majority objectives. In a study by Dassault
of the 12-13 sectors surveyed in the Systèmes and Accenture in 2021, nearly
annual study series since 2020 showed $ 1.3 Tn worth of net new economic value
consistent improvements in digital can be unlocked by using virtual twins in
maturity, indicating greater integration envisioning, designing and executing
of use cases and growing investments sustainability models.
for PoC-to-production.

▪ Servitization of Products – Eminent

Business Model Shifts
Discrete industries are increasingly
moving beyond tactical, product-based
customer interaction to a continuous
way of services-led engagement.
Organizations

Sources: Capgemini Research Institute 2022 Digital Twins study, nasscom’s 2024 Digital Enterprise 5.0 study, 2024
WEF Global Risk Report, 2021 Dassault Systèmes and Accenture Designing Disruption study, nasscom analysis.

12
Why Implement Virtual Twins
Many estimates indicate that virtual twin deployments have delivered on both topline and
bottom-line targets, while improving other objectives of reduced hazardous incidents, enhanced
visibility and tracking of sustainability goals, and superior brand reputation. According to a
McKinsey study of virtual twins adoption in the European region, it was found that on average,
companies reported up to 10% increase in topline, 50% faster go-to-market, and 25%
improvement in product quality, with significantly better product-market fit.

Primary Reported Benefits from Implementing Virtual Twin Tech

“What-If” scenario-modeling enables risk-free joint

Promote Cost experimentation involving business functions, customers, and
and Risk-Free other value chain partners to identify the most fruitful
Experimentation business propositions before actual investments.

Aided by AI/ML tools, virtual twin implementations are being

Unearth used for predictive and preventive monitoring of equipment
Inefficiencies or processes, thereby reducing downtime and improving
Without Costly overall operational performance.
Downtime

The power of AI/ML on machine data helps model and

Predict and predict asset behavior, and dependencies on dynamically
Prevent Hidden changing states of a system, to unknown correlations or
Cost Leaks causations that could result in hidden cost overheads.

Increasingly, system virtual twins are beginning to apply

Build Provenance generative design to entire product, process, and system
of Product, Systems lifecycles, enabling data and decision provenance and
Lifecycles optimized future decisions based on past considerations.

Virtual twins can help businesses plan for optimal responses

Predict and to sudden changes in regulations by using anticipatory
Minimize modelling of possible response lines, response time, and
Regulatory Risks impact of chosen response on business performance.

Virtual twins are being increasingly leveraged to design

Build for Future- sustainable cities of the future by synergizing evolving
State Businesses business models, new technology capabilities, and resulting
and Value Chains shifts in people, skills, and leadership decisions, to ensure
success in such high-risk, high-reward projects.

Sources: 2022 McKinsey Digital Twins: The Art of the Possible in Product
Development and Beyond study, nasscom analysis.
 Virtual Twins – Global
and India Adoption
Trends in 2024

Image source: freepik.com

 Virtual Twins – Global and India Adoption Trends in
2024

The Global Picture

Nascent spend, evolving tech, challenges with How do you allocate budgets to virtual twin
use case and supplier selection implementation?

The expected value from a virtual twin Percent of Enterprises

implementation depends on several
foundational technology capabilities, 2% , No formal budgets
sustained investments, choice of tech Budgeted with
provider, team constitution, and use case joint IT-OT Adhoc, for PoCs
prioritization. The top findings from the global ownership 8%
17%
survey of 130 enterprises on their virtual twin
strategy and deployment approaches are Budgeted in
presented below . central R&D
12%
Spend 39%

I. Awareness about virtual twins is high; Budgeted

Budgeted 23% within IT
adoption skyrocketed after COVID-19
within OT Spend
Spend
s
Global enterprises are
90% aware about virtual twins
If budget is allocated, what percent of tech
spend is allocated for virtual twin tech ?
Number of virtual twin
2X implementations in 2020- Percent of Enterprises
2023, vis-à-vis, 2014-2019
1-3%
10% or more
7%
II. Yet, spend on virtual twins is nascen t 23% 4-5%
16%
Current virtual twin implementations entail
significant costs as they require a
combination of specialist software, skilled
workforce, and connected data systems that 8-9% 28% 26% 6-7%
are a challenging proposition for most
organizations.

Even as 90% of the companies report that

Continuous manufacturing industries tend to
there is some budget allocated to virtual
spend more, with 57% companies spending in
twins, only 24% allocate over 10% of their tech
the 8-10%+ range, whereas over 60%
spend on virtual twins. These companies also
enterprises in lifesciences and healthcare and
report more advanced and at-scale
public infrastructure spend in the 6-9% range.
deployments.

Sources: Nasscom survey of 130 global enterprises, nasscom analysis.

 III. Digital and process automation Across the major stages in a virtual twin
maturity – foundational pillars to build development cycle, which ones are more
virtual twin implementations – is low. mature by execution?

Successful virtual twin implementations Percent of Enterprises

require a minimum level of digital and process
automation maturity. Few companies report
that level of readiness. Use Case Prioritization

Supplier Selection

Enterprises demonstrate
maturity in their digital and PoC to Production
20% process automation
capabilities Native Twin
Development

Total
Twin Lifecycle
We define minimum maturity levels as: Management

Digital Maturity: Spend above 30% of total Twin Scale-Up

tech spend with a minimum 80% of the
functional workflows digitalized and
delivering expected value within stipulated RoI Realization
time.
Next-Gen Twin R&D
Process Automation Maturity: At a
minimum, automation of core production
0% 20%40%60%80%100%
processes or functions, scaled all the way up
to integrated OT and IT across factories/ 1 = highest maturity 2
locations with predictive/prescriptive 3 4
decision making. 5 = lowest maturity

Detailed maturity definitions and stages are More enterprises report efficacy in managing
in the Appendix. the virtual twin lifecycle, drawing RoI, and
innovating on newer implementations once a
virtual twin has been put to production.
IV. Enterprises struggle the most with use
case prioritization, and it reflects in Inadequate focus on use case identification
most implementations restricted to impacts the ability to align and deliver
single product or process virtual twins. strategic business objectives from virtual twin
projects. Fewer than 50% of the respondents
report impact metrics aligned with business
growth or innovation targets. Comparatively,
Enterprises are attempting
60% of the digitally mature companies are
performance optimization or
able to prioritize high-end use cases – building
operational efficiency gains
67% sustainable product lifecycles, optimizing
from existing assets or
next-gen products based on real-time, end-
processes, with limited
to-end lifecycle visibility and control on total
reported success.
production cost.

Sources: Nasscom survey of 130 global enterprises, nasscom analysis.

16
V. The top use cases chosen by the major industrial segments are predominantly at the
process and operational efficiency scale .

The priority-ranked use cases across industry segments are as follows:

Discrete ▪ Process downtime simulation and prevention

Manufacturing ▪ Asset, process, or production-level ESG target management
▪ Asset monitoring and predictive maintenance
▪ Production line or factory layout design
▪ Energy and resource utilization simulation
▪ Design of experiments for operations, supply chain or enterprise risk
management
▪ Production process planning and optimization
▪ Product lifecycle circularity or sustainability tracking
▪ Design – interactivity or interdependency analysis
▪ Product design and customization
▪ Control tower operations management
▪ Input and output defect detection, prediction

Continuous ▪ Input and output defect detection, prediction

Manufacturing ▪ Asset monitoring and predictive maintenance
▪ Process downtime simulation and prevention
▪ Output formulation or recipe design
▪ Material requisition and waste management monitoring
▪ Product and/or packaging design and customization
▪ Facility operations and energy consumption optimization
▪ Retail store layout and merchandising simulations
▪ Real-time buying behavior based in-store recommendations
▪ Omnichannel inventory management
▪ Unit design, layout, and development planning
▪ Customer-led product design
▪ Virtual end-to-end immersive buying experiences
▪ Production line or factory layout design
▪ Design of experiments for operations and supply chain risk
management

17
Public ▪ Logistics scenario planning
Infrastructure and ▪ Asset monitoring and predictive maintenance
Smart Cities ▪ Spatial capacity utilization and development simulation
▪ Real-time project planning and controls design
▪ Economic zoning with trade corridor planning
▪ Green and sustainable development
▪ Resource distribution, utilization, and refurbishment planning

Lifesciences and ▪ ER operations management

healthcare ▪ Drug development process twins
▪ Patient care lifecycle management
▪ Electronic Manufacturing record / batch record
▪ Physiological behaviors and emergency response simulation of
biological systems
▪ Operating procedure simulation and robotization
▪ Drug discovery process twins
▪ Complete human anatomy twins
▪ Medical device/asset twins
▪ Hospital (provider) facility management

18
VI. The next big challenge is in setting up Virtual Twin Software Stack
the core tech stack with software, IT- Percent of Enterprises
OT hardware, and connectivity
capabilities to build a virtual twin .
API Libraries/
Middleware
Only 40% of the companies have production-
Analytics, AI/ML
grade software, IT-OT hardware, and Applications
connectivity capabilities needed to
implement virtual twins. Specialist Hardware-
Enabling Software
Virtual twin implementations require general-
AR/VR/MR Applications
purpose software and platform capabilities,
such as API libraries, IaaS/PaaS Automation/ HMI
applications, AI-IoT platforms, as well as, Software
specialist software, such as CAD/CAE, high-
definition 3D modeling software for Application Platforms
multiphysics simulation, finite-element
analysis software, hardware-embedded High-Def 3D Software
software, etc. It is the latter, the more
specialized modeling software, that is more 0% 20% 40% 60% 80%100%
challenging to productionize.
Production-Grade Focused Pilots Only PoC
These applications further closely depend on
the capabilities of underlying hardware and
require high-fidelity network capabilities for
point-to-point data transfers. Virtual Twin Hardware Stack
Percent of Enterprises
Majority enterprises report PoC or pilot-grade
capabilities in the required tech foundation, IaaS
even when they are seeking simple virtual twin
implementations at a product or localized
Software-Embedded
process level. Hardware

It is to be noted that as virtual twin 0% 20% 40% 60% 80%100%

implementations scale-up to encompass
multi-location processes, cybersecurity also Production-Grade Focused Pilots Only PoC
becomes an important technology
foundation to be managed.

Virtual Twin Connectivity Stack

Percent of Enterprises

Cloud-to-Edge
Connectivity

High-fidelity Networks

0% 50% 100%

Production-Grade Focused Pilots Only PoC

19
VII. Software procurement and
source either off-the-shelf
implementation, and supplier
software or SaaS applications
selection, are challenging.
to build their software stack,
65%+
forgoing necessary
Of the three virtual twin tech components, customizations that could
which is the most difficult to procure and give better results.
implement?

Percent of Enterprises look for managed tech

33% services players who offer
38 % generic software services.
Software
41%

IT-OT Hardware 35%

39%

Connectivity Tech 27%

20%
VIII. Across the board, there is lack of top
organizational leadership
Difficult to Procure Difficult to Implement commitment.

As a result, over 75% of the companies are Who is responsible for funding and
either in PoC validation or piloting mode with implementation decisions related to
high-end 3D simulation software, AR/VR virtual twin deployment in your
applications, advanced human-machine organization?
interface applications, or application
platforms integrating IT enterprise apps with Percent of Enterprises
OT enterprise apps (SCM, ERP integrated with
MRP and MPS).
18 % -
Ot her
It further accentuates the supplier sourcing Leaders
challenge.

Virtual Twin Tech Provider Status 6 0% - Central

22% and BU IT
CXOs Heads

companies have onboarded a

29%
virtual twin tech provider.

IX. Scale-up of virtual twins is quite time-

intensive, and ecosystem readiness
also plays a crucial role .

companies look for a best-of- Virtual twin implementations across levels –

breed software provider product, process, product lines, factory or,
36% portfolio, a less strategic and centrally-managed control tower operations –
riskier approach to building take significant time from use case selection
scalable virtual twins. to PoC, production and scaling up.

20
What is the time taken to implement each Discrete Manufacturing
stage of a virtual twin?

Percent of Enterprises 42% of discrete manufacturing companies

have the required process
automation maturity to take on
virtual twin deployment, highest
across industry segments.

Continuous Manufacturing

88% Enterprises were able to build a virtual

twin in less than 2 years.

67% Have cloud-native or SaaS

Of virtual twin deployments applications, significantly higher than
take nearly 12-24 months at the other segments.
each level, indicating the time-
45%
intensive technology discovery
to production cycle with each 50% Enterprises in this segment leverage
new twin implementation. services from specialist software
providers, such as Dassault,
It's worth noting that lifesciences companies significantly more in proportion than
are able to accomplish faster turnaround other segments.
cycles, majority implementations within 12
months.
Lifesciences and
Ecosystem synergies are crucial in driving Healthcare
sustainable business growth through virtual
twin implementations – 85% of the
companies acknowledge dependence on 33% Of the virtual twin initiatives in
upstream and downstream players and value lifesciences are driven by top
chain enablers for the success of their own leadership (CXOs), compared to just
virtual twin-validated sustainable business 22% on average.
objectives.
3X More lifesciences companies indicate
dependence on downstream
companies’ virtual twin adoption for
X. Industrial segments differ in their their own virtual twin value realization
approach and prioritization of use
cases for virtual twin applications.

21
XI. Virtual twin scale-ups will require effective handling of impending issues across data, tech
integration, skilling, organizational readiness, and cost management.

Data Data
Security Historical Data sourcing, Data Data Data
and Data Volume and standards, hosting and lifespan and ownership &
Privacy Integration Scalability and quality localization archiving governance
Data Challenges

High-
Real-time Cloud-Edge Tech debt performance Scalable Virtual twin
device & data computing IoT device and ESG computing analytical/AI lifecycle
interoperability integration proliferation targets (HPC) needs models management
Tech Challenges

Engineering
SME skills , science,
in data statistical & Multidiscipli-
science Skills in simulation nary skills to Cyber Vendor
and managing modeling Design lead virtual security management
Skilling analytics, change skills thinking skills twin projects skills skills
and AI/ML
Challenges

Effective
Virtual twin Use case Funding predictive Measuring Cross
tech selection virtual twin decision- virtual twin Avoiding functional
upgrades and scaling scale-ups making RoI vendor lock-in use cases
Organizational
Readiness

Cost of
Cost of technology Cost of Cost of Cost of
technology M&E Cost services technology-led Cost of technical debt
technology
Cost of integration (provider risks upgrades products management
Technology cost)

Sources: Nasscom survey of 130 global enterprises, nasscom analysis.

22
India Adoption Trends
Historically silo-ed data and lack of system interoperability hurting scale and RoI

▪ 57% of Indian enterprises allocate less than 30% of technology spending to digital
Digital and spend
Process ▪ Over 50% of the enterprises also indicate patchy digitalization, with only the key
Maturity functions digitalized, but in silos, thereby limiting effective RoI realization
▪ Less than 1-in-5 companies have put in place advanced process automation,
majority have implemented RPA

▪ 25% of the companies do not have formal budgets for virtual twins
Virtual Twin ▪ ~80% of the companies have less than 7% of tech spend allocated to virtual twin
Budgets and adoption
Scale ▪ 63% of Indian companies deploy virtual twins at the product or process level,
majority, of these, 40% at the product level. Precision in product-market fit is also
an important use case for Indian enterprises.

Deployment ▪ 75% of virtual twin implementations in India take between 12-24 months of
Time deployment time at each level of product, process, or system twin

Primary ▪ Manufacturing process efficiencies

Business ▪ Remote maintenance and worker safety
Objectives ▪ Precision in product market fit

Supplier ▪ 75% of Indian enterprises cite supplier selection as a major challenge

Strategy ▪ ~50% are evaluating suppliers, compared to 70%+ global that are evaluating

▪ 70% of Indian firms indicate that across software, IT-OT hardware, and connectivity
tech, they are still in the PoC/pilot stages
▪ Surprisingly, analytics and AI/ML applications are one of least productionized, after
Tech high-definition 3D software and other specialist applications. Over 50% global
Readiness enterprises (ex-India) indicate that they have production-grade AI/ML and
analytics software.
▪ ~67% of enterprises seek either best-of-breed software packages or partner with
large managed services providers for their virtual twin applications

Certain challenges that Indian enterprises face exclusive of their global peers has to
do with older data management systems and lack of systems interoperability.

Data
▪ historical data integration
▪ data security and privacy
Major Scale- Tech Stack
Up ▪ Integration of cloud and edge systems
Challenges Skills
▪ Change management and communication
Organizational Readiness
▪ Funding of virtual twin scale-ups and tech upgrades
Cost of Technology
▪ Managing the cost of integrations

Lower than global average Similar to global average Better than global average

Sources: Nasscom survey of 130 global enterprises, nasscom analysis.

23
The Mature Global Adopters
Value-yielding, scalable virtual twins built on robust digital foundation and provider partnerships

20% of the companies demonstrate maturity, defined as:

n=130 20%
- Digital spend over 30% of tech spend + cross-functional
workflow digitalization + RoI in stipulated time
- Process automation, at a minimum, of a complete process or
production line, scaling up to fully integrated IT-OT systems
across all locations

▪ ~50% - are in advanced economies in APAC (Japan, Taiwan, ANZ)

Demographic and Continental Europe.
▪ ~60% - reported $5-10 Bn in ARR in FY2023.

Virtual Twin ▪ 50% - allocated 8%+ of tech budgets to virtual twin technology
Spend ▪ 88% - had clearly define budget ownership under IT or OT
▪ ~60% - successful in scaling-up virtual twins and realizing RoI

▪ 60%+ - mature adopters are driven by the prospects of building

K ey Drivers sustainable product lifecycles and product optimization with end-to-
end visibility into total cost of production and asset lifecycle cost

K ey ▪ Tech - Virtual twin lifecycle management and scalable AI models

Challenges ▪ Skills – Multidisciplinary skills and vendor management skills
▪ Cost – Cost of sustainable technology for virtual twins

▪ 80%+ - have production-grade tech stack in APIs, AI/ML, software,

Tech Stack specialist hardware-enabling and embedded apps, cybersecurity
▪ Pilot-stage – applications for high-def 3D simulation, cloud-to-
edge. Tech platforms, and high-fidelity networks

▪ 70% - have onboarded strategic virtual twin tech provider

Sourcing
▪ 55% - choose strategic enablers, such as Dassault Systèmes
Strategy
▪ <3% - choose integrated chip-to-software providers, such as Nvidia

24
 Sources: Nasscom survey of 130 global enterprises, nasscom analysis.

Virtual Twins for

Sustainability

Image source: freepik.com

25
 Virtual Twins for Sustainability Goals

With the Global Goals 2030 (United Nations Sustainable Develop Goals and the Paris Accord
targets) deadline approaching fast, virtual twins can prove crucial in fast-tracking the design-to-
realization of approaches required to deliver on these goals. According to a 2021 study by Dassault
Systèmes and Accenture, virtual twins can help companies reduce their costs, resource use and
carbon footprint and they can support disruptive innovation and agile, customer-centric, more
circular business models, effectively unlocking net benefits of $1.3 Trillion of economic value and 7.5
Gt of CO2 emissions reductions between now and 2030.

These critical approaches are focused on starting with existing asset and process optimization for
efficient utilization of inputs, reduced production waste, and superior quality control for maximum
input-to-output realization, to then scaling these initiatives to rethink product design for
sustainability and better end-of-life management, and finally, to sustainably manage waste,
thereby incrementally leading to a more responsible and sustainable circular economy.

Select Examples of the Scale of Impact on Sustainability Efforts with Virtual Twins

1. Energy Efficient Housing

30-80% reduction in building
energy consumption can lead to
$280+ Bn of cost savings and 6.9
Gigatons (Gt) of CO2 emissions
reduction by 2030. This can be
made possible using virtual twins
to model low-carbon
autonomous housing by virtually
engineering airflow, insulation,
energy use and recycling of
wastewater to decrease water
consumption by 70% and
modeling greener buildings.

2. Sustainable Product Design

CPG and Automotive industries
can significantly reduce waste
from obsolescence or spoilage by
designing a more sustainable
product and rethinking
3. Circularity-Supporting packaging and distribution.
Production Practices Virtual twins help with lifecycle
Virtual twins can help design and cost assessment (LCA) based
engineer eco-friendly products simulations. CPG sector could
that can be source-traced for save $135+ Bn in raw material
sustainable procurement and product development costs,
practices and can eliminate while the auto industry can avoid
polluting methods during the $430 Bn in flawed product cost
process design to reduce 80% of and save $260+ Bn in AV/EV
the traditional process impact. development costs.

Sources: 2021 Dassault Systèmes and Accenture Designing Disruption study, nasscom analysis.

26
Roadmap to Building Scalable Virtual Twins
The 20% of mature adopters from the survey that indicated building improved and sustainable
product lifecycles as one of the top drivers for adopting virtual twins also admitted to facing
challenges with zeroing in on best-fit use cases, managing data integrations, building scalable
analytical platforms, and managing costs for sustainable development of virtual twins over
complete product lifecycles. Virtual twins are a high risk-high reward tech investment needing well-
coordinated IT, OT, leadership action to prepare the organization for scaled adoption.

Seven-Stage Virtual Twin Development Roadmap

Sources: nasscom analysis.

27
Outlook and Recommendations

The cities of Singapore, Los Angeles, With a multi-vendor tech portfolio, most
Amravati, Gothenburg, Stuttgart, Seoul, organizations find it difficult to find the
Rome, Chattanooga, Campo de Cartegena right partner for their virtual twin
are a select few in a growing list of national- initiatives. Strategic partners with the
scale, government-led virtual twin initiatives ability to strategize and provide specialist
to rethink, replan, and redesign public implementation services, or consolidate
infrastructure to accommodate rapid such services across multiple partners, will
urbanization. be highly sought as adoption grows.

In May this year, the US Department of 3. Establish dedicated CoE for Virtual
Commerce, under its ambitious $50 Bn Twin R&D: As twin technology
CHIPS and Science Act of 2022, has invited assumes significance similar to smart
funding proposals from companies to manufacturing, led by
establish and operate a CHIPS transformations in AI/ML, IoT, cloud-
Manufacturing USA institute focused on edge computing, memory
virtual twins for the semiconductor industry. technologies, and high-speed secure
connectivity, virtual twins will become
A case-in-point is the virtual twin of Jaipur the default digital transformation
city in India that was started in 2018 as a way platform for most companies.
to fully map the city from ground and air to
visualize, plan, and implement urban 4. Build Virtual Twins for Agility
management initiatives and bring new Align virtual twin technology goals
services, while maintaining the overall with broader business objectives of
heritage of the city. ESG or sustainability, enterprise risk,
and responsible AI goals, to enable a
With virtual twin adoption destined to grow
planned, responsive approach to
rapidly, progressive adopters and technology
changing compliance requirements.
experts recommend the certain guidelines to
effectively plan and deploy virtual twins:
5. Reimagine Sustainable Business
1. Virtual Twins is not Digital with Virtual Twins: Real and
Simulation: Providers of twin tech sustainable benefits can emerge by
should undertake this initiative to expanding the scope of virtual twins
explain the distinction, and the high- to the value chain and adjacent
risk high-reward profile of the virtual ecosystems. Core to circular
twin tech, as it is critical to get economy, sustainable procurement-
complete buy-in from enterprise to-decommissioning lifecycles can be
leadership to deliver a successful visualized digitally on the basis of
virtual twin. lifecycle cost of assets (LCA) to
minimize waste and environmental
2. Start Small, Envision Scale: Even damage.
progressive adopters indicate
scalability as a key challenge as it
entails scaling up multiple
technologies and resulting
interdependencies.

28
“
Virtual twin technology is poised at the brink of
transformative potential as the focus on optimizing
assets and processes opens expansive opportunities
to further unlock groundbreaking innovations and
build for a digitally integrated future.”

”
Sangeeta Gupta, Senior VP and Chief of Strategy, nasscom

“ We remain committed to empowering businesses in

their journey towards enhanced performance and
operational efficiency through virtual twin technology,
driving sustainable growth and innovation across
industries.

”
Deepak NG, Managing Director, India, Dassault Systèmes

29
<dark background>

Appendix

30
Survey Demographics
This study involved a focused survey of 130 global companies across two major economic regions
– Europe and APAC – to understand the adoption objectives, organizational readiness,
implementation depth, and impending challenges that organizations encounter when planning for
deployment of virtual twin technology.

Survey Respondent Profile by Regions, Industry Segments, and Annual Revenue

United Asia-Pacific (ex-

Kingdom, 19% China and ex-
India), 23%

Continental
Europe, 8% Regions

India, 27% China, 23%

USD 500M – 1
Billion(B)
30%

USD 10B+ Annual

55% Revenue

USD 1B – 5B
15%

Industry Segment Details:

Public infrastructure Continuous
and smart cities Continuous manufact ur ing: BFSI, Retail:
manufacturing
CPG, Retail: Home and Lifestyle, Energy
23% 27% and materials.

D iscrete manufact ur ing: Aerospace and

defense, Hi-tech, Industrial equipment,
Industry Segments
Marine and offshore, Transportation and
mobility.

Life sciences and heal t hcar e :

Discrete Pharmaceuticals and biotechs, Medical
Life sciences and
manufacturing devices and equipment, Patient care
healthcare
23% 27%
Public infrastruct ur e and smar t cit ies:
Architecture, engineering and
construction, Logistics and supply chain
solutions, Public services, Telecom and
media Infrastructure

31
Maturity Definitions
Digital Maturity: How would you rate your organization’s digital maturity on a scale of 1 to 5, 1
being the highest?

Digital maturity for this survey purpose is defined as a composite metric that combines digital
spend as a percentage of total tech spend with scale of digital adoption across core operations
and return on overall digital investments. The matrix below explains each of the scale options. Please
select one that applies to your organization most closely.

Digital Digital spend as % Scale of Digital Adoption RoI

Maturity of Tech spend
Score

1 = highest 50% or more – 80% or more of enterprise Zero-sum digital

digital spend workflows digitalized transformation – RoI
exceeds traditional from current digital
tech spend projects routed to new
digital projects

2 40% or more 50% or more of workflows Net positive RoI being

across major enterprise reported in stipulated
functions digitalized time to value realization

3 30% or more Enterprise scale digital Digital RoI metrics, such

implementation started with as incremental cost
an integrated data savings, process or GTM
architecture in place agility, etc. put in place

4 20% or more Multiple functions digitalized RoI from digital projects

over 50%, still vertically, not is measured in terms of
horizontally further digital spend
allocation

5 = lowest 10% or more 1-2 functions, such as IT, HR, Digital spend RoI not
Sales, or 1-2 enterprise-scale measured with distinct
processes, such as lead-to- measures, traditional
cash, digitalized over 50% cost or efficiency
measures used

Process Maturity: How would you rate your organization’s process automation maturity on a scale
of 1 to 5, 1 being the highest?
▪ 1 = Scaled industrial automation with integrated OT and IT across factories/ locations and
using predictive/prescriptive decision making
▪ 2 = Automation of enterprise-scale business decision making at a single location (have
connected ERP, SCM, and CRM with MPS and MRP)
▪ 3 = Automation of core production processes or assembly lines
▪ 4 = Automation of certain sub-processes
▪ 5 = No or ad-hoc automation, at a task level (mainly RPA)

32
Acknowledgements
The preparation of this report has been facilitated by the survey of 130 global enterprises across
four major industry segments and five major European and APAC economic regions, conducted by
nasscom’s survey partner, Curious Insights.

The study also utilizes in-depth expert content prepared by Dassault Systèmes as part of their
3DEXPERIENCE platform offerings that aim to promote awareness and education about virtual
twins as an advanced twin technology.

We wish to sincerely thank Dassault Systèmes and their subject-matter experts for powering the
study and sharing their experience and learnings from practical virtual twin deployments, without
in any way compromising the neutrality of the independently analyzed survey findings presented in
the study.

Research Authors

Achyuta Ghosh
Senior Director and Head of Research, nasscom
Insights

Namita Jain
Director, nasscom Insights

33
About Dassault Systèmes

Dassault Systèmes is a catalyst for human progress. We provide business and people with
collaborative virtual environments to imagine sustainable innovations. By creating virtual twin
experiences of the real world with our 3DEXPERIENCE platform and applications, our customers
can redefine the creation, production and life-cycle-management processes of their offer and thus
have a meaningful impact to make the world more sustainable. The beauty of the Experience
Economy is that it is a human-centered economy for the benefit of all – consumers, patients and
citizens. Dassault Systèmes brings value to more than 350,000 customers of all sizes, in all
industries, in more than 150 countries. For more information, visit www.3ds.com

34
About nasscom
Nasscom represents the voice of the $250 billion+ technology industry in India with the vision to
establish the nation as the world’s leading technology ecosystem. Boasting a diverse and influential
community of over 3000 member companies our network spans the entire spectrum of the industry
from DeepTech and AI start-ups to multinationals and from products to services, Global Capability
Centres to Engineering firms. Guided by our vision, our strategic imperatives are to accelerate skilling
at scale for future-ready talent, strengthen the innovation quotient across industry verticals, create
new market opportunities - both international and domestic, drive policy advocacy to advance
innovation and ease of doing business, and build the industry narrative with a focu s on Trust, and
Innovation. And, in everything we do, we will continue to champion the need for diversity and equal
opportunity.

nasscom Insights is the in-house research and analytics arm of nasscom generating insights and
driving thought leadership for today’s business leaders and entrepreneurs to strengthen India’s
position as a hub for digital technologies and innovation.

Disclaimer

The information contained herein has been obtained from sources believed to be reliable. nasscom
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Use or reference of companies/third parties in the report is merely for the purpose of exemplifying
the trends in the industry and that no bias is intended towards any company. This report does not
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