Blockchain is a fascinating word and technology. It elicits a range of emotions from all kinds of people around the world, with a dedicated community of almost a million followers on Reddit, with advocates vouching for its seemingly revolutionary technology that is able to disrupt all kinds of industries while also gaining very vocal critics that dismisses the technology altogether.
Blockchain, at its core, is simply a system of decentralized and distributed ledgers. These distributed ledgers enable data keeping to be recorded in a trustless manner through decentralized nodes across the world. By extension, data recorded on these ledgers are immutable — meaning, they can’t be altered or tampered with.
This opens up a wide range of possibilities for Blockchain to be applied in today’s business industries. The most notable and well-known use case of Blockchain is disrupting the global financial payments system with the popularity of Bitcoin.
However, this article will focus on one of the lesser-known use cases of Blockchain, which is applying Blockchain to a myriad of business scenarios, such as Supply Chain Management, Marketing, Traceability, Authentication and more.
The anti-Blockchain argument
One of the most common criticisms against Blockchains are: Why not use a local or Cloud database?
An article by IBM covers this topic very well. The gist of it is that traditional databases just don’t offer benefits that Blockchains are known for, the secure, trustless and immutability characteristics of Blockchain.
A traditional database solution can be seen as a kind of intranet solution, the precursor to full fledged Cloud and Internet-based solutions, while Blockchains can be seen as the Internet.
How databases work causes it to be a walled garden, where if you want to cooperate with external partners and stakeholders, you would have to give access to your proprietary database to others and that process gets more complicated the more stakeholders are involved.
Why would companies want to give database view/write access to others? Transparency is the key here.
In recent times, consumers are increasingly demanding in terms of information access and transparency. Companies would also like transparency in terms of honesty by every stakeholders; Tampering of data records occur frequently, for example, a transport company being dishonest about the temperature of their seafood delivery truck to avoid liability.
With the current solution, its a lose-lose situation for all stakeholders.
Take for example, a supermarket’s current Supply Chain process flow. For a supermarket, you have to consider the rights and privacy of:
- The supermarket
- The supplier
- The logistics company
- Middleman distributors
- The producer at source
- Regulatory departments
- The customer.
That’s at least 7 parties involved!
To exchange information between all 7 parties is not only difficult but also complicated. A traditional database solution is notoriously hard to secure against data leaks because of the complexity to account for the number of stakeholders involved.
Evergreen, a US-based consulting firm found out in their market research that 85% of companies that try to manage a database solution fail at properly securing databases.
Walmart China adopts a Public Blockchain solution
With the short analysis above we’ve established that there exists a problem in terms of opening up the supply chain due to technical issues. Companies WANT to be more transparent and they are just held back by technology.
Some companies, however, are taking the leap to adopt Blockchain technology to solve the problems stated above.
Walmart China is adopting Blockchain in an impressive manner, promising to place product info for more than 100 product lines on a public Blockchain called VeChainThor (VET). This particular usage seems to be pushed on by one the Big Four auditing and assurance firm PwC.
It is expected that the Walmart China’s traceability system will see traceable fresh meat account for 50% of the total sales of packaged fresh meat, traceable vegetables will account for 40% of the total sales of packaged vegetables, traceable seafood will account for 12.5% of the total sales of seafood by the end of 2020.
With the VeChainThor blockchain solution, Walmart China was able to achieve multiple high-level strategic goals for its business, including: Transparency in Marketing, Consumer engagement, Traceability, Database security and integrating all stakeholders on a common database platform called the Walmart China Blockchain Traceability Platform.
Blockchains are adopted by assurance companies and regulatory authorities
Walmart China is just a small example of an enterprise choosing Blockchain and proving that its benefits work. A few examples are listed below:
DNV GL, the world’s largest risk assurance and certification company that boasts more than 100,000 enterprise and business clients announced that they too are integrating their core business with the VeChainThor Blockchain.
PwC is directly advising its clients to choose and adopt Blockchain-based solutions (Walmart China is the prime example right now). A survey by PwC revealed that Blockchains are going to be increasingly prominent in the business world.
Deloitte is pushing Blockchain-based solutions and actively researching its potential to bring real economic value.
The above are just a few examples of leading bodies worldwide accepting the potential of Blockchain.
Critics might continue to talk about how Blockchains are useless or a fad, but the fact of the matter is that the industry is adopting Blockchain at a rapid rate.
The future for databases and solutions that involve multiple stakeholders are evidently in Blockchains. The case studies certainly support this theory.