It’s no secret that warehouse operations must improve. Growing Industry 4.0 efforts drive both the demand and means for optimization, so logistics businesses must capitalize on new technology to stay ahead. Warehouse digital twins are among the most beneficial of these innovations.
Digital twins have made waves in several industries over the past few years. Harnessing this potential in warehousing is key to reducing errors, improving the bottom line and ensuring ongoing productivity.
What Is a Warehouse Digital Twin?
A digital twin is a virtual representation of a physical object or system. Unlike conventional digital models, though, these simulations use data—often in real time—to reflect the real world in extraordinary detail.
Manufacturers use this technology to model and refine products before production—reducing development times by up to 50% as a result. In a warehousing context, digital twins could model anything from a single forklift to an entire supply chain. These applications can yield significant time and cost savings—potentially even more than what manufacturers experience.
Like many supply chain processes, warehouse operations suffer from a lack of visibility above all else. Digital twins can provide the visibility and experimental sandbox organizations need to fix their long-standing inefficiencies and become agile enough for today’s demands. Doing so starts with recognizing where to apply digital twins in warehouses.
Digital Twins for Supply Chain Planning
On a broad scale, warehouse digital twins provide a way to improve supply chain planning. These virtual models enable faster and lower-cost optimizations by simulating various changes within a mock-up of the supply chain. Business leaders can see what supplier strategies or new logistics routes would yield the biggest improvements without experimenting in the real world.
Simulations aside, digital twins can bolster supply chains by providing a comprehensive view of the entire network. Warehouses can see all their suppliers and downstream partners in one view. This visibility extends to the third parties and secondary suppliers these organizations rely on.
Gaining such detailed, real-time transparency into the supply chain makes it easier to inform effective warehousing strategies. Managers can adjust their sourcing strategies, change 3PLs, alter routes or otherwise tweak operations to prevent delays, stock-outs or surpluses.
Digital Twins for Inventory Management
Businesses can apply digital twins in warehouses on a smaller scale and still see impressive results. Inventory management is an excellent example. Many warehouses struggle to maintain efficient inventory practices, but real-time visibility through digital twins makes it easier.
Organizations can start by collecting data through Internet of Things (IoT) devices and warehouse management systems (WMS). This data reduces the number of errors in inventory management and provides an accurate picture of operations to create a detailed digital twin. Once businesses have a data-driven virtual model, they can analyze it to find inefficiencies.
The digital twin may reveal that items with limited shelf lives are expiring because the warehouse stores them out of sight, leading pickers to overlook them. Alternatively, it could show where the most frequently picked items are and where they should be instead to facilitate faster picking. Some twins could even enable real-time alerts about dead inventory or nearing expiration dates.
Digital Twins for Process Optimization
Similarly, warehouses can use digital twins to find and fix process inefficiencies. Some of these may be inventory-related, but some may be broader workflow issues, such as bottlenecks when teams load and unload trucks. Whatever the case may be, resolving these problems starts with recognizing them.
Modeling a warehouse’s workflows in a digital twin reveals how goods, people and machinery move throughout the facility. Error-prone processes, bottlenecks and stoppages become more evident as a result.
After recognizing these inefficiencies, warehouse managers can simulate alternate processes in the digital twin. This virtual testing reveals which changes would be most effective without disruptive, real-world trial-and-error. Businesses can then confidently implement the strategy showing the most potential in simulation, leading to a faster return on investment.
Digital Twins for Equipment Maintenance
While many warehouse digital twin applications model large, facility-wide processes, this technology also enables more targeted improvements. Predictive maintenance is among the most impactful of these small-scale use cases.
Predictive maintenance uses IoT data to build a digital twin of a machine like a forklift or material handling system. By updating in real-time and analyzing past data, these models reveal conditions that suggest the machine will need maintenance soon. The system can then alert workers of incoming repair needs for faster, more cost-effective fixes.
This approach to maintenance prevents breakdowns while eliminating unnecessary downtime from inspections when nothing is wrong. As a result, repair costs can fall by roughly 40% in some facilities. Warehouses will also experience more equipment uptime, leading to higher productivity.
Using Warehouse Digital Twins Effectively
As these use cases highlight, digital twins have extensive applications across warehouse operations. Like any technology, though, they require careful implementation to reach their full potential.
Performance and security issues are the most significant barriers to digital twins, so warehouses should address these problems in implementation. On the performance side, that means ensuring facilities have sufficient hardware and software to support this technology. Investing in IoT sensors to provide more data and network resources like 5G and cloud computing to raise data processing speeds will help.
Security-related issues stem largely from digital twins’ reliance on IoT endpoints, which can be difficult to secure. Warehouses can tackle this issue by changing default passwords and requiring multi-factor authentication on all IoT devices. Encrypting IoT data transmissions and limiting access to digital twins will also help.
Warehouse digital twins can be difficult to implement effectively. Given that complexity, warehouses should start by testing this technology in a small but impactful area first, such as predictive maintenance or optimizing a single workflow. As that project shows returns, businesses can expand digital twins to new processes, using what they learned in the initial rollout.
Don’t Miss the Potential of Warehouse Digital Twins
Applying digital twins in warehouses helps logistics businesses become more efficient, accurate and agile. They can then keep up with today’s ever-shifting supply chain demands with minimal disruption.
Digital twins are not the only Industry 4.0 technology warehouses can benefit from, but they’re one of the most impactful. Once businesses implement these solutions, they can take their other digitization efforts further. Learning about this potential is the first step.
