10 Ways Block Chain Will Revolutionize Supply Chain Industry
- April 8, 2017
- Posted by: Upinder Singh
- Category: Block Chain, Supply Chain
The Block Chain technology is taking the whole world by storm. It is being touted as one of the greatest technological innovations in supply chain industry. It is being looked as the only way via which a consumer can directly gain access to the information pertaining to the product or service he is using. This technology is in total contrast with the old supply chain which always wraps around a mystery about the products and the services used by the consumers.
Block Chain is strengthening the supply chain industry in many ways. If you go by the words of any block chain expert, you would believe that the block chain is here to revolutionize the supply chain industry.
Supply Chain Industry and Its Shortcomings
Supply Chain is a compilation of all the processes involved in sending a product or a service from a supplier to the consumer.
The processes involve getting the raw materials, turn them into finished products and then finally send them to the end customers. A proper management of supply chain holds great importance because a proper and optimized supply chain is responsible for lower costs of the products and a quick production cycle.
If we go a little back in history, supply chain was considered as a brilliant concept. But, later people began to see many shortcomings in the supply chain industry.
The first issue that arose with supply chain process was the lack of transparency. A consumer would never know anything about the goods he has been using. A retailer or a consumer would never be able to rule out the exact cost and the quality of the products. He also, wouldn’t be able to track the invention or geographical displacement.
When the concept of supply chain came into being it was welcomed with open arms but, looking at today’s scenario, it would miserably fail to fulfil the purpose. With globalization and thorough fragmentation of businesses, the old supply chain patterns are of no use.
Block Chain and Its Benefits
Block Chain is the latest revolution that has come forward as a backbone of the supply chain. It has increased the efficiency of the supply chain by manifolds. The block chain consultant is of opinion that block chain has the potential to eliminate all the issues that have been cropping up with the supply chain and to transform it into the most efficient process.
Technically talking, a block chain is a distributed database that collects the ordered records known as blocks. These blocks are temper resistant i.e. there is no way anyone could change any detail that has been recorded. They can access the details, inspect the details and add the details but, they can delete or alter the already recorded data. This makes it the safest place to save records or data especially for the businesses who work together on the internet.
Earlier, block chain companies used block chain technology for managing and recording the financial transactions only but, today, this technology can be used for non- currency purposes also. Block chain ledger are the apt places to record events, transactions, identities, medical records, et al. They are also used for tracking as well as verifying the trades. Block chain consultant of any industry or company uses this new technology to increase the efficiency of the supply chain process.
According to the block chain expert, block chain is boosting the supply chain industry in many ways. Here are the 10 ways in which block chain will revolutionize the supply chain industry:
The biggest cookie point that we get with the use of block chain technology is transparency. Everything that goes in between the process of supply chain from the supplier end to the consumer end is recorded permanently and it is open to all. Anyone can access the details and check every single detail about the product and services they are using. The blocks contain the information right from the beginning of manufacturing the product to the shipment and finally, the sale of the product to retailer or consumer; every single thing can be tracked. Hence, a consumer would know the quality of raw materials that are being used, the time it takes in manufacturing the products, the cost that goes into making the product, the parties involved in manufacturing, shipping and selling the product, the exact geographical location of the product, and of course, the extra money that the manufacturers and retailers make.
When the product or a service starts moving, the transactions are recorded in the blocks. Hence, a person can rule out the exact cause of the product or service. This is not possible with the old supply chain methods. Today, with the used of block chain a consumer knows everything about the material, labour and of course, the exact cost of the final product.
With increased transparency, it has become very easy for the consumer to track the factors that are involved in making a product or service available to a consumer. Where supply chain fails to track all the details due to the expanded work area, block chain manages to store the information in spite of globalization and fragmentation of work. A consumer can track all the factors that are even remotely attached to the product or service. For instance, a consumer can track factors like child labour, slavery and violence that come as a part and parcel of making the final products and services and offering them to the consumers.
There are several companies that engage in many unlawful acts while manufacturing a product. They indulge in offensive activities and keep aside the work ethics and morals in order to save money and benefit themselves.
Tracking all these acts with old supply chain methods is a tough nut to crack. All these unlawful acts can be easily tracked with block chain technology. Also, buying products from any unauthorized source has come to a halt with the use of block chain technique.
Block chain experts consider block chain as the safest place to store records. Though blocks are open to all but, it does not mean that anyone can temper the details. The details that are fed in the block cannot be changed. Whatever goes into the block is permanent. One can only add more details but, cannot erase or change the details. This offers a thorough security to the supply chain. Especially in the industries which involve the storage of a lot of sensitive information, block chain offers great help. The sensitive information stored in the ledger cannot be hacked.
With block chain technology everything is accountable. A consumer would get all the required details to justify any decision or action. This is possible because every minute detail is stored in the ledger.If anything goes wrong with the product or service, the consumer knows who is responsible. This has also helped to cut down forgery by leaps and bounds.
According to the block chain expert, block chain gives equal opportunity to the consumer to become a part of supply chain by collaborating with the manufacturers at any point. This gives the consumers a platform to co- operate and collaborate. They can actively take part at any step.
Scalability with block chain is not at all an issue. Greater scalability accounts fo nhr change in the number of participants or anything at any scale.
New Markets and Automated Purchases
With block chain, a person can make automated purchases by bringing in use of smart contracts. The supplier publishes products or services on the block chain and mentions a certain price. By setting up smart contract, the consumer can automatically purchase the product when the price of the product goes below the certain range.
Block chain consultant tag block chain as least complicated. In block chain technology all the information is stored in a single public ledger. Hence, it cuts off all the complications that occur in multiple ledger systems.
With block chain, a consumer knows everything about the product. This helps in verifying certifications or assigning certifications to the products. Also, it has become easier to link the physical products to serial numbers, digital tags or bar codes.
Increased Opportunities and Innovation
Block chain is an innovation. The decentralized architecture of the technology offers ample of opportunities to fabricate innovative uses of this technology.
Block chain has simplified the lives of all the parties that are involved in a supply chain. It has benefited the people at both the ends of the spectrum. This innovation is here to stay and is going to bring about many big and favorable changes to all the industries like healthcare, defense, law government, energy and many others.