Comparing Digital Twins and Virtual Engineering in Buyer Supplier Relationships for Complex Production Facilities

In today’s highly competitive and interconnected global marketplace, the effective management of buyer-supplier relationships is essential for organizations seeking to stay ahead. With the rise of complex production facilities, ensuring product quality and optimizing communication between buyers and suppliers presents an escalating challenge. This complexity is further compounded by the integration of Digital Twins and Virtual Engineering, requiring innovative solutions to navigate the intricacies of modern supply chain dynamics. This article explores the role of Digital Twins and Virtual Engineering as a strategic approach to enhance buyer-supplier relationship management within the context of complex production facilities using insights from the Principal Agent Theory. Based on a systematic literature review, we explore current approaches to the use of virtual engineering and digital twins to overcome existing tensions from principal-agent theory.