Abstract

As firms continue to experience changes in their information technology (IT) capabilities owing to the rapid development of IT applications, they are under pressure to use their IT to ensure continuous business adaptability and agility. One of the most promising emerging IT applications is the Digital Twin, a technology in which a digital duplication of a physical object is produced that enables rich analysis and simulation to take place. Firms need to explore the optimum configuration and hybridization of technology to keep enterprise performance on a desirable level. Enterprise agility, defined as the ability of a firm to sense and respond to a changing environment, is seen as playing a vital role in this key challenge, as it satisfies the overall aim of improving a firm’s performance while helping to adapt to the changes caused by the emergent IT applications. The authors argue that the equilibrium between agility and the adopted IT application capabilities can be better understood and presented by using the system dynamics model, which aims to quantify predictive scenarios. In this model we categorize the impacts as: (i) Digital Twin applications; (ii) the deployment approach; and (iii) agility contextual enablers. Such impacts cannot easily be measured and understood using cross-sectional methods; rather, an approach that combines description of the current reality and prediction should be adopted to understand the nature and level of the impact on enterprise agility and, ultimately, on enterprise performance.

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