For many people, blockchain is about cryptocurrency. We’re not going to address that today. Blockchain also has real-world uses in supply chains and operations. It has the potential to transform the oftentimes slow and costly supply chain procedure into an automated, transparent set of processes. This addresses enterprise needs, now.
On the podcast “This Week in Innovation,” hosted by Jeff Roster, Advisor Council Member at GMU Center for Retail Transformation, and Brian Sathianathan, Co-Founder of Iterate.ai and Member at Forbes Technology Council, Founder Chris Georgen of Tobl joins to discuss the importance of bringing trust and certainty to supply chains. Georgen’s solution? Blockchain.
According to Georgen, blockchain can provide trust, communication, and connectivity where there didn’t use to be. To hear Georgen’s thoughts and more about Tobl, check out the podcast episode here.
Today, let’s take a deep dive into how blockchain is the solution that supply chains need.
Most discussions of blockchain involve cryptocurrency or bitcoins. This has nothing to do with that. At its core, blockchain technology is a ledger of all transactions, and then all participants in a chain also have a complete copy of that ledger.
Blockchain brings together two big factors with potential benefits:
As products move along supply chains, enterprises often run into many errors. Besides actual product manufacturing, a basic supply chain involves several transactions: retailer placing an order, supplier getting financed from bank, supplier shipping merchandise to retailer, retailer paying supplier, supplier paying bank, retailer returning damaged merchandise, supplier paying for that, and on and on it goes.
In short, supply chains can get quite long and convoluted, and there is quite a bit of room for error along the way.
The following are some advantages of incorporating blockchain technology into supply chains:
According to Georgen, around a dozen or so startups are currently working on building supply chain perspectives on top of the blockchain, but Topl is unique by being the blockchain itself. It was built exactly for this purpose.
As always, with new technological solutions, there are some challenges. Currently, supply chains require private blockchains among known parties. This means that only known parties can participate in a blockchain, so companies must give and receive permission to join in. This poses a potential problem in terms of data privacy: how can blockchain participants efficiently be vetted and given approval? Most companies that are already using this technology focus on narrow applications that are already well-defined, making it usable, or they’ve built a strong ecosystem of partnerships with other firms they trust.
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