Blockchain may not be children word yet, but within the next decade its influence on businesses will rival the transformative capabilities in the Internet. The possibility applications of blockchain are endless, and for retailers blockchain will probably be revolutionary, write Cognizant’s Steven Skinner and Lata Varghese.
Blockchain creates a digital peer-to-peer network that permits direct transactions among users. Its distributed and immutable nature eliminates costly redundancy and enables trust, eliminating the requirement for and cost of the intermediary. Public blockchains, for example Bitcoin, are anonymous and ready to accept anyone, while permissioned blockchains, for example could possibly be found across a supply chain, comprise teams of connected stakeholders who have a vested interest in doing business together. Permissioned blockchains offer privacy, security and scalability and they are well matched to the demands of the enterprise environment.
Highly secure by design, blockchains provide enhanced transparency using a distributed ledger and public key encryption techniques that protect sensitive information while allowing verification and authentication of knowledge by every one of its users. In effect, this creates some books for the complex, Kogan Page Logistics Books, enabling retailers to detail the complete transaction history of something from source to sale without each retailer offering control over its data and assets.
Blockchain allows retailers to validate a product’s provenance and guarantee authenticity, helping combat counterfeit goods and reinforce the price of premium products. Almost all of the crucial that you bottom and top line growth as a possible estimated $461 billion in imported counterfeit goods hit the world market annually, in accordance with the OECD as well as the Eu Ip Office. While there are numerous applications for blockchain inside the retail world, its business value to the supply chain is most readily apparent and simply understood.
Blockchain technology is truly transformational to the supply chain
Blockchains can leverage so-called smart contracts inside the supply chain to carry out actions according to a specified pair of triggers, creating both controls and efficiencies. As an example, every time a retailer confirms receipt of your shipment around the blockchain, an intelligent contract might automatically initiate payment to the appropriate parties. Or, an intelligent contract could automatically trigger performance of the insurance plan every time a sensor detects anomalies inside a storage warehouse. Smart contracts could also be used to make procurement decisions according to a defined pair of attributes, streamlining the procurement process. Constructing a transformational blockchain network can drive efficiencies over the entire supply chain, lower costs and counter-party risks through disintermediation, and improve customer relationships by giving indisputable proof of authenticity.
Because blockchain adoption inside the retail marketplace is a maturing technology, many executives wonder if to act now or wait-and-see before jumping on board. A good starting point would be to define use cases for blockchain that address particular pain points or improve optimisation. Following that, developing proof of concepts and executing pilots may help determine how, when or whether to unleash the strength of blockchain across your organisation’s supply chain.
Understanding blockchain’s implications to the industry now can drive future decisions about technology and enable executives to guide how blockchains evolve. Those found on the forefront will shape blockchain’s evolution to work best with the needs of their organisations thereby driving competitive advantage. Blockchain technology is truly transformational to the supply chain, and may require change on the cultural, technological, and business process level comparable to those of the web. Those who fail to embark on that evolution now may pay the price for late adoption.
Related: ‘Blockchain Technology: How it works, main advantages and challenges’ and ‘Consortium launches blockchain technology initiative for logistics’.
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