Every now and then, any business, no matter what industry it belongs to, grows. This growth is usually promoted by the changing and forever-growing business environments and industry innovations. A significant part of this growth today is technology. And the biggest revolution that technology is bringing in recent times is blockchain.
It has become obligatory for businesses to be open to radical changes in order to have a sustainable strategy of doing business and stay relevant indefinitely. Blockchain is one such revolution that will bridge businesses and the future. Let’s see how Supply chain management systems will benefit from this novel technology.
Today’s supply chain has grown more complex and specific to the goods which are being distributed. It could cover multiple locations and can have hundreds of stages. From suppliers to the consumer, every stage in itself could involve transactions, invoices, and certifications.
Supply chains today are no longer a linear process of transactions of goods. They have grown into becoming dynamic ecosystems with layers instead of steps of transactions. It has transcended to become an act of collaboration instead of just baton-passing transactions. From a supplier to an end consumer, the supply chain facilitates the journey of a product without anything being lost in transaction.
How does Blockchain add value to the supply chain?
To understand how blockchain supply chain management solutions will operate at scale, let us look at what areas of the process it will target.
Supply chains at present are handling large and complex data sets and processes, but everything on paper, undertaken by manual forces who are prone to making errors, and lose the records. This is a common practice in supply chains involving distribution via sea. Blockchain will replace these manual systems of recording making it not only faster but much more reliable, and efficient.
Consumers are aware today and do not just buy anything off the rack. They make sure they read the labels, and usually care about where their product has come from. Blockchain supply chain development will not only make all this information readily available but will also ensure quality by eliminating the chances of black-market low-quality infiltration at any stage of the supply chain process.
With the use of RFID tags that stores the information about the product and integrating smart contracts with the information saved in RFID tags, the transaction is executed as promised by each partner on completion of the delivery.
Many blockchain supply chain development companies have been often quoted for their experiments with the integration of blockchain in the supply chain process.
Walmart tested out the application that traces pork in China and the produce in the US for the purpose of authenticating transactions and keeping foolproof records, IBM and Maersk have been working on cross-border transactions with blockchain integration for the efficiency of the process. And even BHP and provenance have been reported to experiment with supply chain security.
At Codezeros, we worked on one such project where we were asked for our blockchain supply chain management solutions. We developed Ecochain, a blockchain-based fiber exchange platform for international markets. In this app, we created a tracking of fiber provenance through all levels of the supply chain, aggregating invaluable data in the process.
Our partner company Slangbusters Branding Studio rendered their services by adding the design element to the layout, user experience, and interface development for the digital product that made our vision into a tangible product.
We even created a fiber coin which was a custom token developed for Ecochain that made transactions faster. This app aggregated data for specifications, duties, customs, shipping, provenance, sustainability, etc.
It was created with a vision of acting as not just a platform, but an ecosystem for the buyer, seller, and auditor keeping in mind their individual paths beautifully intertwined that adds efficiency and convenience to fiber transactions at a global scale.
Through blockchain development for this supply chain, the benefits that any party involved would get:
- - Faster transaction speed
- - Lower transaction costs
- - Verified buyers and sellers
- - Transparency of fiber genesis
- - Sustainability and social responsibility
Transaction support was provided for fiber genesis in the forms of financial ratings, international clearing, quality testing, shipping, capability assessment, freight forwarding, environmental analysis, and the logistics of the full supply chain.
Supply chain management with blockchain integration will work only if all the parties involved. There are many other challenges that supply chain systems integrated with blockchain have to overcome before it becomes the standard for a channel to function. All we can say for sure right now is that even for supply chains where parties are trusted, have done business in the past, blockchain integration will add trust, transparency, and traceability as a standard. It might seem complex, but in reality, it will simplify more complex and layered supply chains.
Blockchain is definitely going to change the way we do any business, not just supply chain systems. The potential for this technology has not been fully realized as yet. As long as companies are exploring the use cases, they will understand the value proposition of blockchain technology for their businesses.
Alicke, Knut, Alan Davies, Markus Leopoldseder, and Alex Niemeyer. 2017. "Blockchain Technology For Supply Chains-A Must Or A Maybe?". Mckinsey & Company.https://www.mckinsey.com/business-functions/operations/our-insights/blockchain-technology-for-supply-chainsa-must-or-a-maybe
“A Taste for Collaboration- an interview with Guilda Javaheri,” Chief Technology Officer, Golden State Foods.https://www.ibm.com/downloads/cas/D2L1BJVA
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