While the business blockchain adoption might seem like everyone’s hopping on the bandwagon, there’s definitely more to that.
In the business world not all are created equal, with some companies being naturally innovative while others must strive to do so, all the while being prepared to accept the costs of keeping up with the times. But following the herd mentality and innovating without deeper analysis can derail the business to the path of endless expenses, costs, unfinished projects that keep being postponed, and losing the point of the whole undertaking.
To help you keep laser-focused we’ve got a couple of reasons why you might need blockchain in your company to make it more efficient.
#1 Working with multiple contractors in a supply chain
One of the areas of the economy for which blockchain technology is a natural fit is supply chain management. After all, DLTs are here to bring clarity and transparency in complicated environments.
An ideal blockchain system that would suit all businesses that are part of a supply chain, would let them see the parts of the process that impact the process of one party and update their own process for further steps of the chain. So for example, a sub-contractor manufacturing processors would stay in a constant loop with motherboard manufacturers. This would fall exactly into the idea of Toyota’s praised manufacturing process which says that the production line is “to be supplied with exactly what was needed, at the exact time needed.” With blockchain, this principle can go beyond a closed factory, to the whole supply chain.
Blockchain would supply this idea with transparency and traceability, to improve the quality of the end product. However, implementing such solutions is a huge project that needs to go from the up to the bottom – if the brand behind the end product wants to benefit from it, it will push the solution among all the sub-contractors.
Apart from traceability, blockchain-driven supply chains would be more bound together and gain efficiency through automation. And this leads to the holy grail of every business – it cuts costs while it can indirectly drive more revenue.
#2 Managing an inventory
Inventory management is well connected with supply chain management. With blockchain, you can change the process from reactive to proactive. You wouldn’t have to react to the demand, stock, and production capabilities, rather than predict it based on trusted market data coming from sellers.
The lack of transparency and unification among involved parties (sellers – inventory managers – manufacturers) creates challenges that can be avoided with DLT.
As an idea for a huge project, you could create completely new economics based on a constant flow of goods. This, for example, could improve food quality, as it would spend less time in magazines and would be thrown out less frequently.
You could apply this idea on many levels and scales, in many industries with blockchain.
#3 Cross-border payments
Although global payments don’t seem to be much of a problem now, some companies operating globally would greatly benefit from using digital assets that can be transferred in minutes if not seconds, rather than days.
Some banks and big corporations are already testing the solutions to improve their internal cash flow. At the core, the idea is to use digital money to keep track of the spend and exchange assets fast where the speed influences the cost, revenue, or process efficiency.
It might not be reasonable for a small or medium-sized organisation to jump onto an undertaking of this size but if you’re dealing with global payments – this is definitely the space to watch closely. We’re not sure how far we are from the commercial launch of such projects but you’re definitely want to be one of the early adopters.
#4 Working with middlemen
There’s this frequently repeated phrase that the DLT is cutting out the middleman. It’s a fact: you need a middleman everywhere you lack enough trust in the party you’re dealing with. Intermediaries take their share of the deal for their work – such as notaries but also arbitrary traders. In this DLT concept, the middleman is usually referenced to the banks.
Because blockchain technology provides you with a trusted, transparent, and reliable record, at least in some spheres, you can just connect the supplier to the client directly.
To make this idea clearer, let us use an analogy and imagine that you are the owner of solar panels or some other kind of clean energy source, and in this scenario you can sell your excess energy to the grid at a set price. Today, the energy provider works as the middleman, who will then resell the energy purchased from you to your neighbour. With DLT solution, you could agree straight with your neighbour and offer better prices – provided with proper infrastructure, etc. but those are just other businesses that could be built on top of that idea.
Anyway, cutting down the middlemen is always going to reduce costs for you.
#5 Dealing with sensitive data
We’re living in the age of data and any modern company has lots to do with sensitive data – it is either about their clients or their competitive advantage.
How to secure it in a way that cannot be hacked? …exactly, by putting it on the blockchain. This way, all this data is going to stay free of corruption if anything happens to the hardware and with the cryptographic algorithms, the data itself won’t leak.
This is the ultimate answer to GDPR and similar regulations that aim for people to regain control over their data. The benefits? A high level of trust when dealing with your company.
#6 Transparency regarding sustainability
More and more choices are today made consciously. The customers want to know the origin of the products they buy and contribute to achieving Sustainable Development Goals. Simply, do good for others and for the planet.
Right now, they trust certain brands but DLT can provide consumers with a powerful tool for recognizing sustainable companies. The traceability and transparency it provides ensure that a product is eco-friendly from the source to the shop.
If you’re in retail or manufacture sustainable consumer goods – there’s definitely a value in using blockchain.
#7 Innovation
The last point speaks for itself. Just as the Internet created endless new possibilities, this is the same for blockchain now. We know what it is, but how are we going to use it? This is an open book for innovators.
Let us then innovate, create groundbreaking solutions, and make our world a safer, better place!