12 use cases for creating a digital twin of your organization.

The digital twin concept can also be applied or extended to more complex real-world objects such as cities, businesses or countries to support specific financial or other decision-making processes.
A digital twin of an enterprise (DTO) is therefore a dynamic software model of an enterprise based on operational and/or other data to understand how an enterprise operationalizes its business model, responds to change and uses resources to produce the expected customer value.
Operations such as analysis and simulation can then be applied to this more abstract digital twin.
Digital transformation will trigger a whole series of complex changes in the organization and its internal and external relationships. Dealing with this complexity is a challenge.
The concept of the digital twin of a company (DTO) should help managers to visualize options before their implementation and thus reduce the risk of wrong decisions in the organizational design.
Based on numerous interviews and studies, 12 use cases were identified for which the creation of a digital twin of the organization is particularly useful:

Use Case 1: Value-Oriented Program and Portfolio Management

Gartner recommends that program and portfolio managers use digital twins to better plan and manage the strategic and operational impact of their programs and projects on the organization, and in particular to measure progress and results after the program or project is complete.

Use case 2: Demand-oriented value creation networks

 Companies are working with increasingly complex, global supply chains. Demand-driven value networks are designed holistically to optimize value across the full range of extended supply chain processes and technologies. The network captures and orchestrates demand based on an almost latency-free demand signal across multiple networks of business stakeholders and trading partners.  

For designers of such supply chains, a digitel twin can help simulate the impact of changes prior to implementation and better align performance with business requirements.

Use Case 3: Procedural and Work Instructions

A digital twin of the organization is also suitable for creating and maintaining process and work instructions in order to optimize safety, quality, delivery capability and costs; deriving process and work instructions directly from the digital image of reality promises a higher consistency of product and process quality and delivery, faster problem solutions and a drastic increase in training speed for newcomers. Even in production environments that are already very efficiency-oriented, production managers can use a DTO to avoid or detect local sub-optimizations in times of rapid change.

Use Case 4: Enterprise Performance and Cost Optimization

Enterprise Performance Management is a multifaceted discipline with many dependencies. A digital twin makes it possible to compare different perspectives - such as finances, strategic goals, quality, risk, operational or process key figures - across several products, locations, brands or group companies.

The interdependence between functions, processes and key performance indicators can be better coordinated. The benefits of implementing a digital twin include a common understanding, definition and measurement of relevant KPIs, and increased efficiency through management by exception that focuses on below-average performance. In the short term, it allows managers to focus on the essentials.

Use Case 5: Digital Transformation

In order to implement a digital transformation, three elements are required: 

• Digital business principles (How is digital business success measured? How is digital business design developed? Who will be the main actors of digital business design?)
• Digital business design (What is our digital business?)
• Digital Business Execution Plan (How can we implement a successful digital business development program?)

A digital twin helps to transform the digital business design into a digital business execution plan: which processes between which actors can be digitally supported, digitized or made possible in the first place, under which conditions and with what consequences for the company as a whole.

Use Case 6: Strategic Business Process Management

The success of Business Process Management (BPM) in supporting strategy implementation depends on full transparency of the functions and processes and the interactions between them. It also depends on how well the organization can adapt to changing business conditions. 

A digital twin of an organization makes it possible to build a context-related model for business processes. The model visualizes how business processes and in particular their changes can affect value creation, enables the process results to be aligned with the desired operational and strategic results, the creation of suitable visual tracking solutions, in particular for value chains, and the mapping of data to the process topology at all levels.

Use Case 7: Customer Experience Management

Customer Experience Management describes "the practice of designing customer interactions and responding to customer interactions in order to meet or exceed customer expectations in order to increase customer satisfaction and loyalty".

An organization's digital twin enables it to build enterprise-wide performance management from a customer perspective and focus on continuous improvement of customer processes and interactions. This visibility and insight helps improve the customer experience. The digital twin enables companies to identify which customer processes and interactions exist, which different customer segments expect what from the company and how this can be translated into KPIs and goals, how customer processes function and which process improvements are necessary to meet and exceed customer expectations.

Use Case 8: Operationalization of Business Events

A business event is a temporary opportunity where people, data, businesses and things work together dynamically to create value. Its use requires digital business platforms and solution options that collect and implement "situational intelligence" in real time. 

The digital twin of an organisation allows to investigate how observed events and different behaviours are linked and how they all work together, taking into account different outcomes for different stakeholders. Since most of the ecosystems in which organizations operate are open, i.e. constantly changing, a digital twin enables continuous situational awareness of the structures, operations, and relationships themselves.

Use Case 9: Operationalization of Business Capabilities

A business capability model is a representation of the business of an enterprise, regardless of its structure, processes, persons acting or domains of the enterprise. It is designed to enable a company to express "what we should do" based on its business strategy so that it can make decisions about "how we do it".

A digital twin of an organization supports the operationalization of business skills and also enables the measurement of the efficiency and effectiveness of the acquired skills and continuously monitors the status of the skills within the value-adding activities. 

Use Case 10: Business Process Outsourcing

Most business process outsourcing (BPO) vendors today use a variety of Excel spreadsheets, process models, standard static engagement procedures, contract templates with predefined KPIs, and monthly reporting as the basis for contract and SLA compliance. 

To create a powerful BPO organization, executives can use a digital twin of the organization to visualize the supporting business operating models and continuously measure the business case and value of outsourcing business processes.

The digital model enables

• the visualization of integrated processes that combine several dimensions (e.g. contracts, projects, performance, process, risk and compliance),
• the creation of optimized management reports,
• the alignment of all KPIs that indicate actual performance and that go beyond classic SLA indicators,
• the assessment of the maturity of various processes,
• the identification of regional differences in the way processes have been carried out and
• comparison with best practices. 

Use Case 11: Mergers and Acquisitions

Mergers and acquisitions (M&A) bring together whole companies, units or subunits and often raise the question of whether there are possible synergies, complementarities or certain components of the business operating system that can be combined. In addition, it may be interesting to examine where certain divestitures or reorganizations of business units could be made and what the impact would be. 

For this use case, the concept of the digital twin of an organization would help enormously to create a digital twin of the new organization and compare it with the combination of both business models. Of course, this cannot be achieved for the entire detailed organization. However, such a model can be used to support certain scenarios dynamically and visually.

To assess, simulate or even predict problems/risks in the M&A process, executives can build a digital twin to create a business operating model for the emerging business.

Use Case 12: Risk Management and Business Continuity Management

Two other different but related areas are Enterprise Risk Management and Business Continuity Management (BCM). Risk management is a process performed by corporate management that aims to identify potential events that may affect the business and manage risk to provide reasonable assurance that the business is achieving its objectives.

BCM has evolved far beyond the restoration of IT systems to ensure the long-term stability of critical business processes in the event of events such as natural disasters, outbreaks of disease or supply chain outages. 

Since there are many dependencies in both risk management and BCM, a digital twin of an organization creates transparency about these dependencies. The digital model visualizes risk objectives and risk controls in the same way as performance objectives and performance indicators and provides transparency and governance by showing the resources associated with each of the components such as markets, channels, products, interactions, IT systems and applications.

An organization's digital one has enormous potential to gain insight into its own organization and make better decisions - but it is not a panacea for understanding your own business. A digital twin is not a technology or a singular product. To reduce and overcome complexity, you need a competence center approach that combines different dimensions such as organization and culture, skills, methods, technology and architecture, metrics and governance. A digital twin is also not a substitute for business intelligence, enterprise architecture or other enterprise applications; it is complementary.

A digital twin is not a one-time implementation; it requires an agile approach and follows a growth model.

A digital twin of the organisation is about organisations; therefore leadership, culture and people are critical success factors.

The implementation of a digital twin of the organization requires vision and above all courage.

To the original contribution "12 Powerful Use Cases for Creating a Digital Twin of Your Organization", Gartner, Inc., 56 Top Gallant Road, Stamford, CT 06902 USA