Blockchain. I feel like this term has become a buzzword in recent years. Most people associate it with cryptocurrencies, but how about supply chains?
First let’s establish what exactly a blockchain is – a decentralized system that records and verifies transactions. Sounds simple enough, right? Sure but the process to record and verify these transactions can often follow a complex procedure that isn’t always easy to understand.
I’m no blockchain expert, but I do see how this type of transparent system can help uplift current supply chain processes – and that’s what I want to discuss today.
Today, we continue to live in the COVID-19 pandemic – and we have seen that entire supply chains have been disrupted. Many old procedures and processes haven’t been able to keep up with the constantly shifting global landscape. Many wonder what can we do to streamline processes? My answer to this is adopt a blockchain.
The Blockchain Positives:
Cuts procurement costs and production time, offers real-time traceability of production data, can automate RFQ and PO processes, alleviates risk through KYC member verification, and speeds up payments and incentivizes new business.Dennis Delgado
But there is more.
The adoption of blockchain technology in supply chain processes can also encourage more ethical production practices. Because the blockchain is decentralized – meaning it contains no single authority – data is easily accessible, truthful, and verifiable. As companies begin to fulfill their corporate responsibility statements, we see how the blockchain can lead to transparency that will promote ethical business processes.
I don’t have a crystal ball that will tell me what to expect next, but if I were to assume something – I would say that the blockchain will no longer be a ledger used for only cryptocurrencies moving forward. Slowly we will see more organizations adopt this system to maintain ethical, transparent, and efficient supply chains – but only time will tell.