Until a few years back, consumer expectations were much less. Unlike today, they did not mind waiting even for a week or so, to get an order delivered at their doorstep. However, the current scenario is completely different; customers not only give preference to an item’s quality and price, but also their turnaround times. Today, waiting for anything longer than two days, makes the customers loose interest in that product.
To stay at par with today’s competitive market, there is a huge pressure on the supply chain management part. Nowadays, the success of any business greatly depends on its logistics too. In the last one decade, technology has played a crucial role in bringing supply chain management to its next level. Though there has been remarkable positive change in terms of delivery duration and safety of cargo, yet there lie many challenges when it comes to tracking and ensuring the integrity of an order.
After bringing revolutionary changes across different industries, let’s see what blockchain has to offer in the supply chain industry. Blockchain possesses the potential to eliminate the core challenges faced by the logistics industry, and improve the efficiency of supply chain management.
The most talked about technology today, Blockchain, is the distributed ledger technology that builds a digital environment in which none has the central authority. Every participant is given the ability to monitor the transactions, holding the right to approve or disapprove a transaction. The cryptography-based technology is used to authenticate identities, give consent for transactions, and create immutable records on its network.
The advantages of blockchain technology include:
- Authentication of identities
- Faster transactions
- Smart contracts
- Universal visibility rights to all participants
- Ability to create private and public networks ensuring privacy
- Resistance to cyber attacks, etc.
Blockchain-Powered Supply Chain Management
The natural and obvious demands of any trusted supply chain system include transparency, traceability, authenticity, and accountability. And, blockchain-based systems do offer all of these features, which explains that supply chain management can hugely benefit from blockchain technology.
In a blockchain-powered supply chain platform, each participant has the ability to see every transaction in the relevant cargo, enabling them to trace the complete journey of the cargo. And, each transit creates a timestamp on the transactions, which is permanent and immutable, ensuring transparency and traceability of the journey, thereby eliminating any scope for fraud or tampering. The participants (or consumers) can demand for information at any stage and check the status of their order.
Usually, a complex supply chain comprises of several touchpoints before reaching its final destination, which may include producers, dealers, retailers, governments, customs, freight companies, various couriers centers etc. And, blockchain can be easily used to track any product at any of these stages with time-stamped records. Moreover, along with all the benefits of blockchain, consumers get proof of identity, proof of quality, and proof of location, which are essential in a trustworthy system.
Talking about the features of the technology, and its benefits on integration with supply chain systems does not end the topic. Another important aspect is, the legalities of implementing blockchain into a particular system. It is necessary to consider the enforceability of transactions made on blockchain-powered platforms, privacy concerns, data protection laws, cybersecurity laws, logistics regulatories, settlement of blockchain-related disputes, etc. in respective nations. Many countries and business giants have already developed rules and regulations to carry out blockchain transactions and adapt themselves to the cutting edge technology. Supply chain management is going to bloom in the coming days.
Some Use Cases:
- Hyundai Knocks the Door of Blockchain to Build Financial Supply Chain Ecosystem
- South Korea To Implement Blockchain Technology To Track Beef Supply Chain
- IBM and Abu Dhabi National Oil Company Collaborate for Blockchain Supply Chain System
- Malaysia Automotive Institute Selects SophiaTX Blockchain To Streamline Supply Chain