Blockchain Integration Will Improve Corporate Efficiency and Transparency
Supply management has always been one of the most important logistical hurdles for product-based businesses. Companies and end users alike have long speculated on the helpfulness of maintaining records that indicate the full life-cycle of individual products. Data such as where parts and materials were sourced, time of assembly, and even general notes taken during maintenance or ongoing inspections of quality would make it possible to determine the integrity of each individual product on a granular level. Recording the events in a products life cycle would also introduce the ability to track points of failure and inefficiency, making it easier for corporations to improve the competency of their manufacturing, delivery, and maintenance processes.
Until recently, however, the burden of labor was far too great to track any but the most critical of supply data. The most prevalent roadblock has been the problem of efficiency. Using current resource planning systems, all relevant data must be collected, parsed, organized, stored, and recalled manually by employees operating at different levels of a company. In cases such as shipping, this data will often even be manually accessed by second and third party companies as the product journeys from its origin to destination. Employing people to log these tasks is an expensive and time consuming endeavor. Of the limited information that is currently retained, it is rarely available or transparent to customers.
New Technology, Old World
To comprehend how the integration of Blockchain technology would benefit our existing business landscape, it is important to first understand how distributed ledgers work in practice. Information is traditionally stored in a manually updated database. The records in this database are controlled by a centralized party that is responsible for their accuracy, organization, and dissemination. However, because such databases are manually maintained, they are prone to both human error and machination. For this reason, it is reasonable to doubt the accuracy of these records.
Speaking on the efficiency and transparency of Blockchain technology, Stefan Schmidt, the CTO of Unibright states:
“Integrating the Blockchain with existing ERP systems enables enterprises to source existing data and share it in an immutable, secure, and trusted manner. What this means for corporations and their consumers is higher quality products, sourced in exceptionally cost effective ways, with a far greater level of accountability. The significance of Blockchain business integration cannot be understated”.
Blockchain technology improves on the traditional model by distributing database records between many different points of failure. Not only does the distribution of this information make it more transparent, it also ensures that the events recorded within each database are provably true. Blockchain integration also removes the manual component from data entry by allowing event instances to record themselves to the database in real time by way of smart contracts that self-execute when predetermined parameters have been met. As each piece of data is entered into the product’s life cycle record, it instantly becomes accessible to anyone with an internet connection and the appropriate block explorer.
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