Exploring Digital Twin Cost: What It Takes to Develop This Technology

Author: Ankitha VP
May 22, 2024
Exploring Digital Twin Cost: What It Takes to Develop This Technology

The conventional business environment faced challenges in real-time data and predictive analytics, which resulted in unexpected downtime, expensive maintenance problems, and inefficiencies. These difficulties are more severe in businesses where the efficiency and quality of physical assets significantly impact revenue and efficiency. 

Businesses have been depending on recurring evaluations and historical data for a long time. These sources are helpful, but they are reactive by nature and frequently get out of date before being thoroughly examined.

Herein is the breakthrough that digital twins offer to these long-standing issues. With digital twins, companies may use real-time data to mimic, forecast, and improve operations by building virtual replicas of physical assets, systems, or processes. This technology serves a critical role in increasing equipment longevity, promoting safety, lessening environmental effects, and improving operating efficiency.

So, with these benefits, many of you may think about the digital twin cost in the development, right?

Thus, the purpose of this blog is to make the costs associated with developing digital twin technology understandable. Even though using digital twins has several advantages, decision-makers must be aware of the investment cost involved. 

Critical Factors in the Development of Digital Twin Cost

Digital twin development requires careful planning and execution, which has a direct impact on the total cost. It goes beyond simply digitizing a physical asset. The following is an outline of the essential cost variables to take into account:

Critical Factors in the Development of Digital Twin Cost

1. Scope and Complexity

  • Complexity of the Connected Assets 

The more complex and advanced the digital twin gets, the more complicated the asset becomes. Simple mechanical elements to whole manufacturing processes with multiple interrelated components can be considered problematic.

  • Integration Requirements for Current Systems

Digital twins are not autonomous systems. The requirement for seamless integration with current IT and operational technology systems can significantly increase their complexity and expense.

2. Technology Criteria

  • Software Platforms

Selecting the right software is essential since it serves as the foundation for the digital twin. A wide range of options is available, each with a distinct price point, from commercial off-the-shelf items to custom-developed solutions. 

You can connect with the best digital twin companies to learn about the type of digital twin software to be adopted so that costs can be controlled. Thus, choosing the right digital twin software is essential. 

  • Hardware and Sensor Configuration

The hardware and sensors are crucial for collecting data in real-time. They need to be accurate, dependable, and able to function in the environments to which the asset is exposed. The kind of sensors and level of necessary monitoring will determine the final cost.

3. Expert Services

  • Advisory Fees

Ensuring the correctness and efficiency of the digital twin can be achieved by utilizing outside expertise. Consultants are essential, particularly in large-scale projects, yet they are not inexpensive. 

You must ensure that you consult with the best digital twin service providers and that they are accurate in understanding your industry and your desired outcome. 

  • Design and Implementation Services

The most significant variable costs are those related to design and implementation services. They vary depending on whether you can utilize a conventional platform or whether you require a custom solution made to meet specific needs. The design step is crucial and demands time and resources to get it correctly.

Cost Breakdown of Digital Twin Development

It is imperative to comprehend the different cost components before starting the process of developing a digital twin. Let's look at what you need to plan for, from initial setup to ongoing maintenance.

Cost Breakdown of Digital Twin Development

1. Initial Costs

Any digital twin project must start with a considerable initial cost, which includes:

Design and conceptualization

It creates a blueprint for the objectives and representations of the digital twin. This stage is critical because it establishes the project's goals and scope and provides the foundation for all future work.

Software Development or Licensing

This can be a substantial expenditure depending on whether you want to use off-the-shelf software or a custom solution made to meet your unique demands. While developing bespoke software offers customization at a higher cost, licensing current systems may result in cost savings and faster implementation.

2. Operational Costs

Upon launching your digital twin, the expenses continue. Among the costs of operations are:

Maintenance and Upgrades 

Like any other program, digital twins need frequent upgrades to keep operating safely and optimally. These upgrades include updating features and correcting security flaws.

Training and Assistance

Constant training and access to support services are necessary to guarantee that your team can utilize and manage the digital twin software efficiently. These may come at an expense in terms of staff and outside consultants.

3. Hidden Costs

Often neglected, these expenses may have an unforeseen effect on the entire budget:

Data Management and Privacy

Information is the foundation of digital twin technology. However, the costs associated with ensuring data is managed safely and effectively can rise, particularly in sectors with high data vulnerability.

Scalability and Upgradability

Your digital twin needs to change with your business. It's critical to budget for adaptability and additional features because they may result in significant future costs.

Understanding these cost levels makes clear the investment costs associated with digital twin development. The operational efficiency, predictive maintenance abilities, and improved decision-making offered by digital twins frequently translate into substantial future savings and return on investment, even if the original expenditure may appear high. It's essential to consider the value that is added to your operations in addition to the expenses.

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ROI and Justifying the Investment

Understanding the significant return on investment (ROI) that digital twin technology may provide is just as important as controlling expenses when making an investment.

Let's examine the short- and long-term returns below.

1. Short-term Returns

Digital twin implementation can drastically change operations by providing the following:

Enhanced Operational Efficacy

Digital twins' ability to monitor and model assets in real-time can result in notable increases in output and operational agility.

Decreased Downtime via Predictive Maintenance 

Predictive maintenance is one of the most well-known advantages. It uses data from digital twins to forecast breakdowns ahead of time, greatly lowering downtime and related expenses.

These quick advantages aid in laying the groundwork for longer-term, more calculated benefits.

2. Long-Term Returns

Longer-term benefits of digital twins include:

Enhanced Product Innovation 

Digital twins help businesses innovate with less risk by giving them a sandbox to simulate various scenarios and outcomes. This allows for the testing of new ideas before they are really developed.

Long-term Savings and Sustainability

Digital twins support environmentally friendly processes and can result in significant cost savings over time by increasing efficiencies and reducing resource waste.

Selecting a Digital Twin Development Partner

Selecting the ideal partner for digital twin development is essential to the project's success. This is how the choosing process is performed.

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Selection Criteria for the Right Service Provider

It's crucial to take into account a number of critical aspects when choosing a digital twin provider to make sure your partner can fulfill the demands of your project:

Selection Criteria for the Right Service Provider

1. Industry Experience  

Seek a provider who has a track record of success in your particular sector. Their comprehension of the difficulties and rules unique to their business can have a significant impact on how well the digital twin solution works.

2. Capabilities and technology stack

Examine the platforms and tools the company employs for technology. Make sure their capabilities line up with the goals of your digital twin software and that they are equipped with the most up-to-date and efficient technologies.

3. Flexibility and Changes

It's critical to have the capacity to scale solutions as your company expands. Make sure the supplier can modify their offerings to meet evolving requirements.

4. Support and Maintenance 

Post-deployment support and maintenance are essential for digital twin projects to be successful in the long run. Examine the service level contracts and support structure offered by the service provider.

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Final Thoughts

Digital twin technology is a game-changer that can completely change how companies develop, run, and compete in the digital world. It is not just a passing trend. Digital twins present a compelling solution to transform data into practical knowledge and predictive power for a variety of industries.

Digital twin development involves several cost levels, ranging from early hardware and software purchases to continuing maintenance and operating costs. Digital twin cost is influenced by the potential to yield significant returns on investment, providing both immediate operational efficiency and long-term strategic benefits.

Digital twin projects heavily rely on the choice of successful digital twin implementation with right services since they contribute both technological know-how and industry experience.

Is your company prepared to discover the benefits of using digital twin technology?

At Toobler, we're experts at developing custom digital twin solutions that meet the particular requirements of your company and help you get the most out of your investment. 

Connect with us right now to gather relevant information about the digital twin cost and its implementation process.