Alibaba, EY, IBM And Microsoft Use The Blockchain To Create A Transparent Supply Chain
Global companies are looking to deploy blockchain technologies in their supply chains to give them greater transparency. Crucially, blockchain solutions have the potential to solve visibility issues that have dogged the supply chain for decades.
Yesterday, Microsoft launched its CoCo framework to provide governance support for enterprises building their own blockchain projects.
IBM recently announced that it is collaborating with key food producers and distributors to reduce contamination in the global food supply chain. They intend to use blockchain technologies to create a "trusted environment for transactions".
The blockchain is gathering fast-rolling corporate momentum. Many companies now fear being left behind more than the risk of being an early adopter. Participating companies in the IBM initiative include Dole, Golden State Foods, Kroger, McCormick and Company, Nestlé, Tyson Foods, Unilever and Walmart.
The consortium of companies aims to use the new technology to create further transparency in the food sector by tracking food transactions throughout the world and using this information to quickly identify and isolate any food source that is contaminated.
Alibaba had announced a similar partnership with PwC in March to help solve China's own food security issues. Alibaba is investing heavily into the blockchain. It is also introducing healthcare technologies in Changzhou, China. It hopes the system will provide doctors with patient medical records and create a more efficient healthcare procurement process.
Even EY, an accountancy and consultancy firm, yesterday announced that it was launching a blockchain platform to facilitate a shared car ownership scheme. Earlier in May, Toyota declared similar intentions.
Blockchain is an ingenious technology that enhances security in transactions and enables tighter tracking of the supply chain.
The software was developed to validate Bitcoin transactions. The transactions are made public (with confidentiality over elements secured, if wished) rendering hacking into the system and tampering with data nearly impossible. Security is further ensured through the crowdsourcing of storage. Without a single storage point, there is no direct target for malicious attacks.
The elegance of blockchain is such that others are beginning to use it in more formal environments, such as banking and corporate operations.
Indeed, within the supply chain, many companies are looking to use the security of blockchain to track goods throughout the value chain.
The rapidity at which generally risk adverse corporations have embraced cryptocurrency technologies from the dark web may seem surprising, but the eagerness of managers reflects long-standing industry problems.
For decades, companies have operated without basic knowledge regarding their supplies. Indeed, some would struggle to name their suppliers in a given month with surety.
The tech space has been unable to provide companies with a solution. As supply chains have grown more international and more complex, the problem of supply chain visibility has grown more acute.
The recent explosion in corporate interest in the blockchain is in part derived from the near total absence of systems providing complex supply chains with the required degree of transparency. Buyers currently labor for days and weeks to determine how much they have spent and where the money has gone. Beyond a rudimentary level of detail, most organizations are in the dark as to activities of their suppliers.
Blockchain has stepped into this gap and innovative offerings have proliferated.
Buyers of the future may find themselves overwhelmed with data. The hoarders and gatekeeperes of yore may be converted into opensource data managers of tomorrow.
As we have seen above, many companies are applying some creative technological solutions to persistent problems in supply chain information. It is too soon to judge the success of these initiatives - or the blockchain in general - but the future looks to be an exciting place in supply chain technologies.
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