Blockchain technology has a lot of potential in innovating the business world, especially supply chain.
Learn how blockchain can boost supply chain.
Supply chain can be very intricate and complex. One transaction can take days to be settled between two parties, whether it may be between manufacturers and suppliers or customers and vendors. The bottom line is: there are too many steps in supply chain today. However; this process can be streamlined with a new up and coming technology known as blockchain. You may know this term from the recent hype over Bitcoin and other cryptocurrencies. However; blockchain technology is more than a buzz word because it holds a lot of potential to solving the issues that supply chain is currently facing.
How does Blockchain Work?
Blockchain is a digitalized and decentralized ledger that provides security for cryptocurrency transactions. Essentially, blockchain records every transaction in a series of blocks, which can then be copied multiple times over multiple systems called nodes. The reason why the world is very interested in blockchain at the moment is because of how secure it is. Each time a transaction is made, the blocks are continuously linked to the previous block, making it very difficult, almost impossible, to tamper with. Due to its decentralized nature, blockchain technology isn’t disadvantaged by depending on a single entity to keep it safe, meaning that there can be multiple checks and balances to ensure traceability and transparency.
Blockchain Technology Can Boost Supply Chain
So, how are blockchain and supply chain connected? Blockchain can fortify traceability and transparency within supply chain by optimizing how business transactions are secured. Because everything is digitalized, everything can be tracked and processed a lot quicker, meaning less fraud and errors and less delays from paperwork. Like other e-invoicing, the digitalized process can help businesses improve inventory management, identify issues quicker, and minimize costs. This technology has become very popular as many companies are beginning to invest to innovate it for the greater good. Around $1 billion was invested into blockchain as many initiatives are on the rise.
IBM Tracing Food
IBM is one of the biggest companies to start investing into blockchain. One of the aspects they strive to improve is the food industry. With blockchain, IBM is looking to make the global food chain more authentic and transparent by helping suppliers trace food products from the farm until the consumer’s homes. In fact, in this past year, IBM solidified deals with nine food industry giants, including Walmart to find ways to implement blockchain into the supply chain process.
SAP Looks Combine Blockchain and IoT
In 2017, SAP announced that it will be launching an initiative that aims to integrate blockchain into Internet of Things manufacturing. The tech giant sees a lot of potential in the technology and will be working with 27 other companies on this project. SAP’s president of IoT & digital supply chain Tanja Rueckert expressed this excitement saying, “We are equally eager to co-innovate with the world’s leading companies to reimagine a future where blockchain is woven into the fabric of the digital value chain.”
Blockchain technology has a lot of potential in innovating the business world, especially supply chain. By improving transparency and traceability, supply chain can become a lot simpler.