Blockchain For Supply Chain: A Holistic View
Introduction to the Event
Supply chain and logistics management has evolved over the years, becoming more sophisticated to meet the complex needs of the economy. It is also one of the major areas where blockchain technology can have tremendous impact. This is already happening as problems associated with the industry are being tackled by blockchain innovations.
The World Economic Forum estimates that global trade could increase by about 15 percent when barriers within the international supply chain are reduced or eliminated. With the emergence of blockchain technology, some of these problems that hinder trade can be solved thereby boosting local and international economies.
XChain2: Blockchain for Supply Chain and Logistics Forum to be held on May 21st and 22nd in Houston, TX, will highlight the areas of blockchain adoption in supply chain, benefits, strategies and challenges. Blockchain possess features like a distributed ledger and smart contracts which when applied can transform the entire supply chain industry and address some peculiar issues plaguing the supply chains of certain products like food, energy and chemicals.
TRANSFORMING SUPPLY CHAIN AND LOGISTICS WITH BLOCKCHAIN
Blockchain innovation coupled with other new and existing brings tremendous value to the practice of Supply chain management and logistics. In tandem, blockchain solutions can benefit the overall economic aspects of the industry by delivering increased liquidity, freeing working capital and easing settlements. With information and implementation of right blockchain strategies, it would be easier to curb malpractices like counterfeiting and producer exploitation.
Digitalization and Blockchain: Foundation for a Port of the Future
In major ports, which key points on a supply chain, complex activities involving cargo handling, intermodal connections, logistic services as well as industrial activities need to be effectively and efficiently coordinated. ‘Digital ports’ where data is collaboratively shared to improve operations have become the standard but with blockchain technology, the bar is raised even further. When integrated with blockchain technology, these digital systems are primed for an entirely new level of efficiency supply chain driven by verifiability and transparency.
Improving Transparency and Traceability
Blockchain and other distributed ledger technologies (DLTs) are inherently immutable and transparent. Brought into supply chain management, it provides real time tracking and end-to-end traceability to ensure goods are secure and tamper-free along the chain. One can easily and quickly trace a product right from the retailer back to any point along the chain and also verify claims.
Addressing the Pain Points of Trucking and Freight
As seen with its impact in the Fintech sector, blockchain holds great promise for financial aspects of Freight management. DLTs can be used to increase efficiency when managing cash flows and risks. An interesting use case for this technology is in the management of truck drivers which has been a constant area of concern in the logistic managers.
Driving Economic Impact and Fair Trade
With smart contracts, a unique future of certain blockchains, unnecessary intermediaries which drive up the prices or products can be eliminated. When producers can sell their products directly to an online market irrespective of the physical distance, and without needless middlemen, they get a fairer portion of profits and end users get products at better prices. Such is the economic impact of a blockchain-facilitated trade.
HOW BLOCKCHAIN ADDRESSES SPECIFIC AREAS OF SUPPLY CHAIN
Blockchain is creating new possibilities is specific areas of supply chain management ranging from insurance, freight. As blockchain transforms other industries it is also evolving how their supply chains are managed. Supply chains of food products, energy, oil and gas and petrochemicals have all been dramatically impacted by this emerging technology and key players need to be up date with the changes.
Transforming the Insurance sector Insurance, a key aspect of supply chain and logistics, is undergoing a revolution and blockchain is a big part of it. Just like in the financial sector, smart contracts are being trialed for insurance agreements and transactions. With blockchain, insurance settlements can be fully automated, faster and cheaper. Also with a distributed ledger, current, accurate and secure risk information can be shared in real-time among all parties to an insurance contract.
Transforming Global Food Supply Chain and Logistics
Global food supply chain is an area of major concern. With challenges ranging from poor labor practices in cocoa and sugarcane farms, fake food raw materials and products and major product recalls. Major food companies, retail giants, and governments are already exploring blockchain technology to enhance transparency in their supply chain.
Food safety along the supply chain is a matter of great importance hence the growing opportunity and blockchain use cases in food distribution. United States lose $55 to $93 billion to food borne disease annually. producers, manufacturers, distributors, carriers, logistics providers and retailers need to boost efficiency and improve supply chain traceability.
Chemical Distribution Digitalization has hit the distribution of Chemical products; for companies in the sector to remain competitive, they need to adopt digital practices. Again, a blockchain network is a key technological tool that allows suppliers, producers, logistics providers, customers, and other partners in the chemical value chain to exchange vital information.
Transforming the Energy Supply Chain
Supply chain processes in Oil & Gas industry are extremely laborious and prone to human error. The challenges associated with it present a perfect opportunity to test the benefits of blockchain technology. Renewable energy sharing is also a tricky aspect where distributed ledgers and smart contracts can be employed to ensure transparency and automate the processes.
The Blockchain for Supply Chain and Logistics Forum will x-ray the possibilities and impacts of blockchain in the supply chains of energy products and petrochemicals.
IMPLEMENTING BLOCKCHAIN IN SUPPLY CHAIN AND LOGISTICS
Develop A Winning Blockchain Strategy
For a company to benefit from the blockchain disruption, it must develop a good blockchain strategy. A good strategy first answers the key questions surrounding blockchain adoption. Questions like What is the difference between a blockchain and the cloud? If adopting blockchain, will I share data with my competitors? Where is the boundary between on-chain and off-chain? What are the promised benefits, efficiency, and competitive advantages in adopting blockchain?
After answering these questions, it then determines what position would best serve the organization and what definite action plan the company would take. Whereas some may need to develop native blockchain platforms or application, some might need to key into Network or Enterprise blockchain solutions.
Embrace Academic-Industry partnerships
The interaction between the academic and industrial worlds is key to the development and application of blockchain solutions. The blockchain conference is a perfect instance of this, where academic research in the area meets industry experience to create better standards, strategies and solutions.
Initiatives like the Blockchain Technology and Ecosystem Design (B-TED) affords the opportunity of joint research to provide industrial members academic support for future sophisticated innovation.
Funding Blockchain Projects
As the blockchain space is rapidly evolving, there are lots of interesting projects that need financial backing. These blockchain startups present great investment opportunities for angel investors, blockchain entrepreneurs, corporate investors, and industry stakeholders. Investors interested in these startups need to be informed about the peculiarities of the sector. The Blockchain for Supply Chain and Logistics Forum, provides an avenue for investors in this area to interact firsthand with pioneers to address their questions.
Engender Industry-wide Collaborations
The biggest progresses made in the blockchain space have come through collaborations and that would easily apply the case of supply chain. A notable case in the supply chain industry include the collaboration between Maersk and IBM to develop a global blockchain ecosystem for supply chain.
Industry-wide collaborations like this are important and should be encouraged because the attributes of blockchain technology are suited to large networks of individual partners.
The role of Government Agencies
Supply chain and logistics involve multiple governments and as such any worthwhile blockchain implementation would consider the role and impact of government agencies. The Global Supply Chain Subcommittee of the US Customs Commercial Operations Advisory Committee (COAC) identified tracking and reporting of licenses, permits, and trade agreements as an area where govt. can utilize blockchain in supply chain. Blockchain pioneers work with Partner Government Agency (PGAs) to automate the issuance of licenses, certifications, permits and to integrate with blockchain systems.
CONCLUSION
Blockchain, despite the promise it holds, is not without its own limitations and as an emerging technology needs undergo constant improvements. One of such areas of improvement with the data being fed into the system. For smart contracts to be effective, information going into the contracts must be authentic and auditable.
Also, there is great need for proper blockchain education for effective implementation of blockchain solutions in the supply chain industry. At The Blockchain for Supply Chain and Logistics Forum, reputable resource persons effectively handle all the aspects mentioned here and more. It will feature lectures, practical workshops, live demos and discussions on major areas in supply chain and logistics.
A detailed agenda for the conference and profile of speakers and participants can be found at https://blockchainsupplychain.io.
Posted from my blog with SteemPress : https://smartereum.com/14626/xchain2-houston-blockchain-for-supply-chain/