Digital Twins: The Next Big Thing in Operational Risk Management

Digital Twins: The Next Big Thing in Operational Risk Management

By Sphera’s Editorial Team | June 3, 2019

The hazardous industries are abuzz with the latest Industry 4.0 trend: the Digital Twin. From its potential to virtually simulate the performance of facilities and processes without directly affecting the real object, process industry operators are implementing or piloting solutions in droves.

According to LNS Research, 48% of companies in the Oil & Gas industry, 37% of those in the Metals & Mining industry, and 31% of organizations in the Chemicals industry are taking advantage of Digital Twin software. They are using the technology to improve decision-making by simulating the way varying factors will respond to the operational reality of an asset before duplicating it in the real world..

The technology is a top trend, according to Gartner’s 2017 and 2018 analysis, for its ability to bring together the nearly 21 billion Internet of Things (IoT) devices that are expected by 2020.

Embracing New Value

In the industrial spaces, Digital Twin technologies are typically considered and primarily used for monitoring and managing equipment health; however, digitalizing operations with Digital Twins can embrace new value that will maximize efficiencies, improve safety and help operators achieve Operational Excellence across their workforce.

Since the day an asset becomes operational, its process safety risk exposure begins to change. Impairments, deferrals, overrides, Management of Change issues, the status of safety-critical equipment, or even how well processes and procedures are followed have a cumulative effect on Operational Risk. Unavoidably, risks are often managed in different parts of the organization.

Not having a clear view of all the factors that affect the operational reality results in operational inefficiencies, long wait times for frontline work teams, unplanned downtime and the potential for process safety losses.

According to the “The state of Process Safety and Operational Risk Management” 2018 industry survey:

  • 86% of industry leaders believe there are gaps between how process safety is intended and what happens on the plant/asset.
  • 56% believe the risk on their plant increases between periodic process safety review periods (for example, three to five years/reviews of PHAs, HAZOPs, HAZIDs, LOPA studies, etc.).
  • Only 38% of industry operators proactively manage process safety risk.


2020 State of Process Safety Management Operational Risk Management Survey Report
Read2020 PSM/ORM Survey Report
The 2020 report suggests one way to prevent the risks associated with increased MAHs is to turn toward technological solutions.



It is important that hazards are understood on a real-time basis, and the continuous state of process safety barriers is maintained to reduce incidents. Yet, “delivering the full Operational Risk value proposition is a complex technology challenge,” according to independent analyst and consultant, Verdantix. It requires organizations to:

  • Aggregate data from asset management databases, safety reports and equipment.
  • Model asset performance and barrier health with near real-time data feeds.
  • Analyze interactions between workers, equipment and external factors.
  • Engage user groups within a variety of roles and requirements.

Herein lies the necessity and timely emergence of the next big thing in Operational Risk Management: the ORM digital twin. By connecting Industrial Internet of Things (IIoT) sensors that gather data in the physical world along with other critical data, process industry operators can access a real-time, digital replica of an industrial asset’s operational reality. They can simulate asset performance in live operations, and they can see the risk impact of equipment health, planned maintenance work, isolations, process safety risks and more.

According to Verdantix, “Without a doubt, digital twin simulators will enhance Operational Risk management practices. The question is how quickly owners of industrial assets will make this happen.”

The industry is moving forward with this latest trend, fast. Industry leaders anticipate 481% growth over the next three years in Digital Twins to simulate what-if scenarios for improved operational awareness and risk management. In some cases, innovative operators have already broadened the Digital Twin value proposition beyond asset performance management (APM) and equipment health with simulations to transform the way they manage operations, reduce downtime and prevent wear-and-tear that could result in asset failure.

A recent article in Plant Services magazine explained how Oil & Gas company Saudi Aramco is leveraging Digital Twin technology to continuously manage its end-to-end manufacturing processes and monitor the health of equipment in real time. Saudi Aramco’s senior projects manager told Plant Services that the tool predicts equipment health anomalies at an early stage and determines when maintenance should be performed to avoid failure.

But before investments are made in ORM Digital Twin technology, organizations must have a digital strategy in place to gather the right data. But with payoff measured in improved maintenance and asset life extension, the investment is worth serious consideration for its ability to:

  • Automatically bring all system, sensor and human-derived inputs together in a joined-up way to see their cumulative risk impact.
  • Make process safety risk visible, prominent and available in real time.
  • Improve operational awareness through the ability to understand what’s happening, when it’s happening, where it’s happening and what’s driving the risk.
  • Help make better, more informed operational decisions and proactively manage risk against productivity.
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Sphera is the leading provider of Environmental, Social and Governance (ESG) performance and risk management software, data and consulting services with a focus on Environment, Health, Safety & Sustainability (EHS&S), Operational Risk Management and Product Stewardship.
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