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Regardless of the product that an organization manufactures or sells, the desire to have a reliable supply chain practice is not a new concept. Companies and, for that matter, consumers want to be able to ensure that their goods are arriving safely and with little or no issue. If there is an issue, it would need to be addressed and rectified as quickly as possible.
In the past, supply chains often consisted of multiple carbon copy forms, wet signatures, and naked eye confirmations. However, technology has changed the way supply chains are constructed and, moving forward, blockchain will lead the way.
Profitability begins with accountability
At its core, blockchain helps to track a digital asset as it moves through a chain of custody. Technology allows auditors, business owners, analysts, and others to view these movements and ensure that deliveries are timely, reliable and accurate. Blockchain goes one step further here. Because of its immutable nature, organizations can quickly spot areas where theft or fraud may have occurred. They can pinpoint bottlenecks or other hang-ups that can cause delays and address them as needed.
Using smart contracts, blockchain-based platforms can also keep the supply chain moving smoothly by queuing up the next touch point for a good or product. This function alleviates the inevitable backlogs that can often occur when companies are ill prepared for shortages or overages when the goods are received. Participants in a transparent supply chain will have a much clearer picture of what will be arriving and when.
Accountability in practice
An excellent example of how blockchain can bolster a supply chain is evident in the IBM Food Trust. The challenge to find the origination of leafy greens infected with foodborne illness, Walmart and IBM partnered to create this extremely robust supply chain platform. What once took over two weeks to track, can now be done in a matter of seconds. In the typical outbreak of a foodborne illness, large retailers have to pull all of the suspected produce off of all shelves. Food Trust allows them to understand exactly where the issue was coming from and would now only be required to remove lettuce from a particular grower, with a cost savings in the millions.
The eventual goal would be for even the consumer to be able to track where their goods are coming from. Imagine purchasing a pre-made sandwich, scanning a bar code form your phone and immediately having knowledge of where the chicken was raised, where the lettuce and tomato were grown, and where the bread was baked. This is supply chain in action…all the way down to the consumer level.
Blockchain and profitability
To learn how IBM is creating safe and secure supply chain platforms using blockchain as the core technology, please join me for the Increase your profits with IBM Blockchain webinar. You will hear extensive discussion on how these platforms can save organizations money as well as to increase their profitability. You will also learn about our story at Chateaux, and some of the exciting projects that we have worked on including with our customer Vertrax.
Vertrax harnesses the power of IBM Blockchain to create a supply chain application that uses IoT devices to help track the delivery of home heating oil and natural gas. This is an excellent example of the use of the technology and how it can become a trusted component in the continued desire for reliable supply chain tracking.
Supply chains strive for dependable and consistent results. Blockchain is the tool to make this happen.
From time to time, we invite industry thought leaders, academic experts and partners, to share their opinions and insights on current trends in blockchain to the Blockchain Pulse blog. While the opinions in these blog posts are their own, and do not necessarily reflect the views of IBM, this blog strives to welcome all points of view to the conversation.