The relatively new development of blockchain technology is here to stay. This article tells business owners what they need to know about it and how to get ready to use it.
If you have kept your ears open about new developments in the information technology field, you have likely already heard of blockchain. But what exactly is blockchain, and how can your business prepare for and incorporate blockchain technology?
By the end of this article, all current aspects of blockchain will be explained so you can prepare your business for its increasing popularity.
Blockchain technology refers to an expanding group of records (a basic data structure in computer science). These records are called blocks, and each block has a cryptographic hash function of the block that comes before it, transaction data that is usually represented by a hash tree or Merkle tree root hash, and a timestamp.
Blockchain databases are used as open, distributed ledgers that are usually managed by peer-to-peer (P2P) networks and can record data or transactions between two parties using a trusted intermediary so that these untrusted parties can reach a consensus on a common digital history.
Blockchain security is marked by the fact that once the data in a block is recorded, it cannot be retroactively changed unless there is an agreement by the network majority and all subsequent blocks are also changed.
Satoshi Nakamoto (the name used by the unknown person or people who developed the cryptocurrency bitcoin) created blockchain in 2008 to be the public transaction ledger for bitcoin. Today, blockchains are primarily used by banks to record cryptocurrency transactions, or used as the basis for smart contracts. There are three different types of blockchain databases: public blockchain networks, which have no access restrictions; private blockchain networks, where one must be invited by the network administrator to join; and semi-decentralized consortium blockchains which are controlled by multiple companies each operating a node on the blockchain network.
Five ways any business can get ready to implement and adapt to blockchain technology.
Now, let’s look at how blockchain affects your business and how you can get your business ready to make use of this emerging technology.
Blockchain is still a relatively new and growing system, but it has already shown the great potential that it has for businesses in many fields, from IT and HR to finances and marketing. Once you have a clear understanding of what blockchain is and what it offers to your business, you can take these steps to prepare your business for blockchain.
Identify the opportunities where blockchain can be used.
Although identifying opportunities is a standard operating procedure for every organization, you should look at every aspect of your company or department so you can gain insight into the exact places and processes where blockchain technology can be of benefit to your business.
Continue to learn as the technology continues to grow.
Blockchain is still an evolving technology. Nobody in business has an exact understanding of how to incorporate it into their company just yet, so keep an eye on how blockchains change the way they work and what they offer to you, and how you need to change so it can be profitable for your business and beneficial to your customers.
Identify the customer demand and benefits for blockchain.
Customers are the most important part of your business, and every new technology that you implement should be a means toward the end of fulfilling your customer’s desires. Thus, you and your company should identify your customer’s needs and determine how incorporating and leveraging blockchain technology can help meet the needs and build a relationship with existing customers and attract new ones.
Listen to and engage with others in your industry.
Don’t just look inward when trying to understand and utilize blockchain; take an outward-facing focus by attending conferences and talking to suppliers and other businesses in your industry on how blockchain technology is affecting their processes. Consider imitating another company’s use of blockchain, or partnering with them. Keep an eye on what others in your field are doing about this new technology.
Make use of outside specialized vendors.
Once again, don’t just look inward when utilizing blockchain. You may very well not be able to find the ideal blockchain solution by staying inside your own business. It may be necessary to look outside your business to find a specialized vendor in blockchain. The right outside vendor will be able to provide a lot of value and functionality to your business without you having to sacrifice a lot of time and expenditure.
Following these steps will help your business be ready for the emerging technology of blockchain. Making good use of this technology could soon be necessary to stay competitive in almost any field.