Blockchain for Supply Chain Disruption
Anton Shmakau, Arnaud Mauvais, Dion Houng-Lee, Fabio Gava, Joanne Wong, Senthil Subramanian, Shail Rajput
This paper explores the disruptive nature of Blockchain technology, in particular, how it is affecting the supply chain industry, which can greatly benefit from its distributed and transparent nature. The research points to the undeniable potential of Blockchain to revolutionize many industries, drawing a parallel to the evolution of the Internet and all the services that it now supports. Blockchain is built on the communication infrastructure of the internet and the available distributed computing resources. It addresses the problem of establishing trust among unknown parties over an untrusted communication network. The most widely adopted implementation of Blockchain technology, Bitcoin cryptocurrency, was met with skepticism and strong resistance from financial services incumbents. The idea of a world in which currency could flow over the Internet without relying on banks and intermediaries and without regulation by governments was not well received. Bitcoin did not disrupt the fintech industry but it ignited a race for Blockchain platform services due to its applications across many industries. It's predicted that 80% of banks will initiate related projects in 2017.
Research indicates that the supply chain industry is a prime candidate that can
benefit from Blockchain. It has complexities with the multitude of participants,
from suppliers and manufacturers to distributors and retailers, many of which only interface with its immediate counterparty the supply chain. The ability to "see" further up or down the chain would greatly improve speed and allow participants to react to unexpected events. When keeping track of paperwork costs more than moving goods around the globe it's a sign the current process is vastly inefficient, costly and doesn't scale. Disruption in Supply Chain may start with moving the paperwork to Blockchain, then cutting off unnecessary steps and optimizing necessary ones through automation, and finally with the arrival of shared and distributed manufacturing (Industry 4.0) Blockchain will play a significant role in intellectual property protection, smart factories and composite assembly lines.