After it happened in 2008, the technology behind the most infamous crypto coins in the world, Bitcoin, has held the front with special attention to startups and the financial services sector. However, recent attention has been paid, as companies gradually realized that it could be valuable for many other issues, in addition to keeping track of payments.
Simply put, a blockchain is a distributed ledger that sort transactions in blocks. Each block is linked to those used for advanced math, all the way back to the first transaction. Subscriptions are permanent, transparent and searchable, allowing community members to view transaction history as a whole. Each update creates a new \\\\\\\\ block \\\\\\\\ added to the end of the \\\\\\\\ chain \\\\\\\\ – a structure that makes it difficult for someone to modify records later. The ledger makes it possible to include and share information between large groups of unrelated companies and all members must validate all updates collectively – that is in everyone’s interests.
To date, much attention has been paid to financial applications for technology. However, an equally promising test case lies with global supply chain relationships, whose complexity and diversity of interests are exactly the challenges that this technology wants to address.
A simple application of the block chain paradigm in the supply chain may be to register the transfer of goods in the ledger since transactions would identify the parties involved, as well as the price, date, location, quality and condition of the product and other information that would relevant to the management of the supply chain. The cryptography-based and unchangeable nature of the transactions would make it almost impossible to endanger the ledger.
Now a large number of startups and companies implement blockchain to re-invent their global supply chain and run their businesses more efficiently:
1. For Maersk, the world’s largest shipping company, the challenge does not follow the well-known rectangular containers that ship the world on board freight ships. Instead, it is the mountains of paperwork that are associated with each container. A single container can distribute more than 200 batches and approvals of up to 30 parties, including customs, tax officials and health authorities. While containers can be loaded onto a ship in a few minutes, a few days can be held in the port because there is a piece of paper missing while the goods are flushing. The cost of moving and maintaining all these paperwork often reflects the cost of physically moving the container around the world. The system is also full of fraud, because the valuable bill of lading can be minimized or copied, allowing criminals to drop their goods every year or distort falsified products, causing annual billions of dollars in maritime fraud.
In the past summer, Maersk sought cooperation between customs authorities, carriers and manufacturers filling the containers. It began with the first trials of a new digital shipping book with these partners, for the shipping routes between Rotterdam and Newark. After the document has been issued, the customs authorities can immediately copy a digital signature so that all concerned, including Maersk himself and other government agencies, can see that it is complete. If there were conflicts later, anyone could return to the record and are convinced that no one has changedIn the meantime, the cryptography in question also makes it difficult to fade virtual signatures.
The second test visited all the paperwork related to a container of flowers moving from the port of Mombasa, Kenya, to Rotterdam, in the Netherlands. When both tests were good, Maersk followed the containers with pineapple from Colombia and Mandarin Orange from California.
2. Most traders, Wal-Mart, strive to recognize and remove food that needs to be recalled. When a customer becomes ill, it may take weeks to identify the product, the shipment and the seller. To remedy this, it announced last year that it will use the blockchain to include the origin of product critical data from a single voucher, including suppliers, and to record how and where the food was bred and who inspected . The database extends information from the pallet to the individual package.
This allows you to find out where a damaged product originates from a few minutes to days, as well as other important features to make an informed decision about the food flow.
Wal-Mart has already run two experimental programs – moving Chinese pigs to Chinese stores, which produce Latin America to the United States – and is now convinced that a finished version can be prepared in a few years.
3. BHP is dependent on suppliers in almost every phase of the mining process involving geologists and shipping companies in collecting samples and conducting analyzes that carry out business decisions involving multiple parties across continents. These sellers usually keep track of rock and fluid samples and analyzes with emails and spreadsheets. A lost file can cause major and expensive headaches, as the monsters help the company decide where to drill new drilling.
BHP’s solution, which started this year, uses blockchain to record wells and fluid samples and better protect the real-time data generated during delivery. Decentralized storage of files, multiple data collection and unchangeability, as well as direct accessibility, are all aspects that will improve the supply chain.
BHP now obliges its suppliers to use an app to collect live data – with a dashboard and options on what to do that are highly streamlined to their respective tasks. An exemplary technician can contain data such as associated time attachments, a laboratory researcher can add reports, and everything is immediately visible to anyone who has access. No more lost monsters or terrible messages. Although certain elements of the process are the same, the new system is expected to drive internal efficiency, while BHP can work more effectively with its partners.
4. An interesting upcoming blockchain format coming up was designed by a team at Disney and currently the only open source blockchain platform. The so called “Dragon Chain Platform” is meant to bring an ease of use to both backend and frontend users.
Currently, blockchain runs in most of the first implementations in parallel with the current enterprise systems – often older databases or spreadsheets such as Microsoft Excel. The most difficult part will be to create new business models. By implementing blockchain enterprise-wide, companies often need to remove their existing business processes and start from the very beginning. An attempt not for the weak hearts.