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industrial metaverse

CEO Circle

Understanding the industrial metaverse

Published 17 March 2023 in CEO Circle • 7 min read

Forget gaming and luxury-brand NFTs, the most transformative aspect of the metaverse could be its engagement with industry. But what exactly is the industrial metaverse and how will it benefit businesses? And how deeply should CEOs allow their organizations to engage in its development?

If you were asked to imagine the metaverse, you might picture one of the massive online gaming worlds that have drawn in millions around the globe. Or you might think of Facebook and Meta founder Mark Zuckerberg, rendered in avatar form, explaining why we will all soon have virtual social lives.

You are less likely to envision a complex machine, factory, or transport network brought to life in digital form. However, perhaps that is what you should be thinking of. Such digitalization of universal systems is the basis of the industrial metaverse. In essence, it is a combination of technologies that will radically change how we work, live, and interact socially. It could also turn out to be the chief metaversal source of economic and social value.

An MIT Technology Review Insights report produced in collaboration with Siemens, The Emergent Industrial Metaverse, explores the nature of the industrial metaverse and seeks to understand how it will create value – and what leaders should do to guide their organizations through its development. Here are some of the report’s key insights.

What is the industrial metaverse?

The industrial metaverse is, as the report defines it, a combination of technologies that “mirrors real machines, factories, cities, transportation networks, and other highly complex human systems.” In common with the consumer and enterprise metaverse segments, it will provide immersive, real-time experiences.

Critically, the industrial metaverse will be distinguished by its role as a truly accurate simulation of real-world assets – and as an incredibly powerful interface between the real and digital worlds. By employing realistic, physically accurate systems, it will enable industries to examine extraordinarily complex real-world problems through a digital lens – and then use a digital toolkit to solve them. It will revolutionize design and engineering methods, allowing innovators to model multiple potential solutions, then prototype and test them before physical, financial, and human resources are committed to real-world implementation.

A universal application

The industrial metaverse will transform every industry. As such, its potential value is enormous. Data from VentureBeat and ABI suggests it could be worth $100bn by 2030 – dwarfing the projections for the consumer and enterprise strands of the metaverse ($50bn and $30bn, respectively).

Many of the building blocks of the industrial metaverse are already familiar and part of mainstream industrial discourse. Siemens has been working with digital twins, for instance, for over 10 years, using them to help NASA land the Mars Rover as part of drone design, and to develop sustainable cargo ships.

You can find a use case anywhere in the industrial life cycle and make it better with industrial metaverse.
- Ian Fisher, Head of Product Management Visualization for Siemens Digital Industries Software

The report highlights the power of such technologies and explores how they might evolve. Siemens is working with the Ministry of Transport of Egypt to create a digital twin to support the construction of a 2,000-km high-speed network railway, connecting 60 cities and enabling 35bn passenger-km of travel per year. Such models, while potent on their own today, will gain even greater reach when combined with other technologies – for instance, by providing photorealistic models or integrating AI powered assistant systems.

Other key building blocks will be, for instance, extended reality technologies (VR/AR/MR), AI and machine learning, blockchain, cloud and edge computing, and connectivity solutions such as 5G or 6G. The foundations of the industrial metaverse are still being laid, but today’s game-changing technologies are already starting to give it shape.

One thing that is abundantly clear is the enormous number of potential use cases for the industrial metaverse. As Ian Fisher, Head of Product Management Visualization for Siemens Digital Industries Software, says in the report: “You can find a use case anywhere in the industrial life cycle and make it better with industrial metaverse.”

The report identifies five key application areas:

1.Improved design and engineering.

Design teams will collaborate to develop new products, gaining real-time insight without the need for costly investment in physical prototypes – or such outdated concepts as team travel expenses.

2. More extensive testing and validation.

Photorealistic environments based on scientific data, combined with AI and machine learning, will enable businesses to meet a range of objectives, including faster development of new products, more efficient design, and the early integration into the design process of circular-economy principles.

3. Virtual commissioning.

Realistic modelling of manufacturing systems will allow engineers to detect and correct errors without disruption of production lines or waste of resources.

4. Enhanced operations.

A simulated factory will give rise to a wide range of use cases, including virtual factory planning and predictive maintenance, as well as supporting frontline workers.

5. Access to talent and training.

The metaverse will provide unique opportunities to uplift skills and help organizations retain talent, providing employees with access to training, regardless of physical location.

Building the virtual future

As well as emphasizing the potential benefits of exploring the metaverse, the report points out the challenges ahead. New levels of connectivity, computational power, and interoperability will be essential requirements, as will digital twin fidelity. To create reliable predictive capabilities, digital twins should precisely mirror the behaviors of their real-world counterparts.

Despite the uncertainties and exacting requirements, there is no disputing that the industrial metaverse is about to become reality. The report makes four recommendations for organizations that want to help shape the virtual future.

Organizations will need a clear digitalization strategy.
This might involve investing in edge hardware, industrial 5G networks, digital simulation technologies, and AI and machine learning.

1. Don’t lock yourself in

Above all, strategies for the emergent industrial metaverse must focus on the interoperability and openness of digital solutions. These are the basic prerequisites for the technologies of the industrial metaverse, just as they are essential to successful digitalization today. As the report points out: when companies try to lock others out, they only succeed in locking themselves in.

Organizations should, therefore, pursue a modular approach to building or procuring the components of the industrial metaverse. Siemens recognizes the need to develop solutions that integrate seamlessly with one another, including with solutions from other suppliers, which is why it will be essential to establish common standards for digital interoperability and open APIs.

There is a German expression that sums up the inherent importance of this approach. Translated into English, it approximates to: “The way is the goal.” CEOs should ensure the way their organizations move forward is defined by openness and interoperability to avoid creating silos and to maximize future flexibility to adapt with the industrial metaverse as it takes shape.

2. Define objectives clearly

Organizations will need a clear digitalization strategy. This might involve investing in edge hardware, industrial 5G networks, digital simulation technologies, and AI and machine learning. Building these resources now will benefit businesses today and in the future.

Those investments need to be part of a path towards the achievement of clear goals. CEOs need to be certain in their own minds about the value proposition and use cases for the industrial metaverse. Defining clear objectives (such as minimizing waste or accelerating product development) can help distinguish between the inevitable hype that surrounds new and innovative platforms and real value-generating applications.

3. Empower people to build the industrial metaverse

As with any change initiative, the reaction of people affected by the emergence of the industrial metaverse will have a powerful influence on its trajectory. Recognizing that people may be fearful about losing their jobs or seeing their career prospects diminish, the report recommends an approach based on empowerment. Emphasize the opportunities that the industrial metaverse creates and upskill employees to allow them to take on new roles.

4. Build strong partnerships within inclusive ecosystems

The report’s final recommendation is to build partnerships that help unlock innovation. Ultimately, collaboration and openness need to inform every digitalization strategy. Nobody can build the industrial metaverse on their own.

This mindset informs Siemens’ own approach. The Siemens Xcelerator digital business platform, announced in July 2022, will connect developers, service providers and customers, providing solutions that are open, interoperable, flexible, and easier to scale.

It may not be surrounded by the same media buzz as in the gaming industry, but the industrial metaverse is one of the most exciting and important areas in technology development. It will revolutionize the way we work, and generate enormous value for business and societies. We are on the verge of a new era, and together we can build the metaverse that will help us connect and thrive in it.


Peter Körte

Chief Technology & Strategy Officer, Siemens

Peter Körte is Chief Strategy Officer at Siemens since February 2020, and in October 2020 he additionally took on the role of Chief Technology Officer. In these functions he is responsible for the development of corporate strategy as well as the digitization and establishment of the Xcelerator (X).


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