Yes, a ledger is being trumpeted as the revolutionary technology set to redefine how we operate in today's digital world. It is that straightforward, but there's so much more to consider, particularly for organizations using the technology in the supply chain.
What is Blockchain?
To call blockchain a digital ledger is an entirely accurate and realistic description, but its unique architecture makes the technology stand out as a disruptive force. Blockchain is designed to track every transaction made online, through any app or service, and log it in blocks of data that are encrypted to such a degree that, according to TechCrunch, some experts already believe are impossible to hack.
"Blockchain is a truly 21st century ledger designed with the future in mind."
PC Magazine explained the Blockchain situation simply - blocks of transaction data exist in an open, publicly available ledger, but the degree of encryption makes the data impossible to tamper with. As such, blockchain provides complete visibility into transactions made online in a completely neutral way that treats all parties equally, eliminates bias and provides a combination of security and regulatory compliance that is extremely difficult to match through alternative solutions.
Blockchain may be something as simple as a ledger, but it is a truly 21st century ledger designed with the future in mind. It has the potential to disrupt how entire industries operate by creating a level of secure visibility and transaction tracking that is incredibly complex and expensive with current solutions.
How is Blockchain Affecting the Supply Chain?
According to TechCrunch, the ability to track all transactions in an open digital ledger means that businesses and consumers alike can have full visibility into the costs within the supply chain. This can eliminate many of the transparency gaps that currently exist in supply chains and make it easier to modernize and update processes.
Of course, imagining a situation in which a customer calls to ask why you're charging a certain amount for a product when all of the raw materials and shipping expenses - all of which would be tracked on blockchain - may be the first thought that comes to mind. However, this doesn't necessarily represent what blockchain visibility will look like. Instead, TechCrunch pointed to a few startups that are using greater transparency to create value. A few strategies mentioned by the news source include:
- Showing customers just how responsible an organization is in terms of sourcing goods and environmental sustainability to gain brand recognition.
- Simplifying the process of managing fraud in the case of counterfeit goods through the ability to easily track every transaction in the supply chain.
- Automating asset movement by programming RFID labels to trigger when an asset needs to move, establishing a bidding system with shipping vendors in blockchain and completing the transaction within the ledger.
- Allowing local and regional stakeholders to share goods and assets through availability notifications within blockchain ecosystems.
Digital technologies have been changing the supply chain in recent years, and the rise of blockchain solutions is expected to accelerate this transformation. As businesses explore the possibilities offered by blockchain, they must also ensure they have the foundational mobile data collection and integration capabilities they need to log data throughout the supply chain and connect with backend systems, such as blockchain.
At RFgen, we've been leading the charge toward greater visibility in the supply chain through mobile data collection and ERP integration. Our solutions are constantly evolving in light of changing industry demands. Contact us if you'd like some help establishing the building blocks you need for a blockchain strategy.