Blockchain technology was first introduced to the word when Bitcoin came into existence. The technology whose potential can completely reshape the way industries are operating across the globe. Global giants in logistics are ready to dive into blockchain after “Trial of Rose.”
How blockchain can help supply chain?
Blockchain technology can speed up the administrative process involved in the supply chain system. Secured transactions happening in the speed of light is an added reason to adopt blockchain technology into the supply chain. The basic principle behind blockchain technology is the elimination of third parties; the technology can create a secure environment for all the transactions happening inside the supply chain system.
A digital ledger with immutable quality, meaning, and a trustworthy ledger where alterations done to existing documents will be time stamped. A single update can be performed at a time and with each update, an additional blockchain will be added to the platform which is connected together, hence the term blockchain. 256-bit encryption is used for securing the blockchain platform; this system is a nightmare for hackers. A decentralized system is already a hurdle for hackers, accompanied by state of the art encryption the system becomes impossible to tamper with. Government organisations and tech giants are keenly involved in implementing this technology with proper regulations.
Benefits of blockchain in Supply chain
There are various advantages of using blockchain technology in the supply chain industry,
- Precise tracking of products
- Reduced errors [on all trade related documents]
- Information sharing
- Easy audit trial
These are early days to access the full potential of blockchain technology in supply chain industry but still, the technology’s efficiency has been proven in papers. Most of the industries are getting ready to implement the technology in the first quarter of the year 2019.
Blockchain can be used to create ’smart’ contracts that execute the terms of any agreement when specified conditions are met. The “smart” part is a piece of computer code that predefines a set of rules under which the parties to that smart contract agree to interact with each other.
Smart Contracts an added advantage
Smart contracts can help to receive payments automatically and orders can be placed automatically once the stock of the product is about to get over. This can of great help to the administrative section of any industry.
With the opening of the Walmart Food Safety Collaboration Center in Beijing, IBM, Walmart and Tsinghua University are collaborating to improve the way food is tracked, transported and sold to consumers across China
Potential of blockchain technology can be harnessed to create a transparent and efficient supply chain system. Food products can be tracked, starting from the farm until it reaches the consumer. The information once entered in the blockchain platform will have to be agreed upon by all the members, a consensus decision has to be made for proceeding to the next stage of the process. This ultimately increases the accuracy of the system and after a period of time,e all the errors in the system can be totally eliminated. Also, this will help the retailers to know the shelf life of a product easily thereby given them an opportunity to strengthen food authenticity.
Logistical adoption of the blockchain
There are various projects related to blockchain that are ready to be implemented in the year 2019 in the logistics industry. This implementation is urged due to the “Trial of Rose” project undertaken by Maersk. That project clearly indicated the need of a new technology in the system for an improved transportation process. There were some hurdles in the early days when blockchain was talked to impolemented in a supply chain, there was some conviencing to do and now with everyone on board, the blockchain project is ready to set sail.
Still, some more hurdles are there for blockchain to overcome, standards to be followed and a proper regulatory framework, who is going to bare the cost of adapting to a new system? and most importantly getting used to work in a mind set with a decentralized network with no central control.
In the coming days, all these hurdles should be demolised and blockchain can create a better world, a proper transparent system where the operations are carried out in a trust based environment. A decentralized system, with no central power opinion, need a consensus from all the involved parties, blockchain can bring great changes to the existing mode of operation but only if everyone agrees with it.