When we talk about the supply chain, managing all the links, plus distributing post creating is a striking complex process to achieve. Now, this process can span around hundreds of stages through so many geo locations (local and across borders), a pile of payment receipts, not to forget the numerous units involved extend over a period of months. But the current supply chain systems involve a lot of complexity and lack of transparency. Owing to this there arises a lot of interest in including blockchains to transform the current process in the industry.
Coming straight to the point. What is broken? Does blockchain have any unique attributes that could help?
Answering the questions here.
Bringing to you a few examples of how blockchain is already impacting supply chains?
Firstly how is the current supply chain incapacitated?
In several ways, let us tell you in brief. Going back in time when supply chains were way simpler because commerce was just happening locally, unlike today. Today when the industry has spread so much more, beyond borders, the situation has elevated to an incredibly complex position; demanding major innovation. Hence the introduction of the shifting to haul freight via trucks rather than rail, followed by the emergence of personal computers in the 1980s that led to a dramatic shift in the supply chain management system. Today when the manufacturing industry is globalized, and a huge chunk of this is covered by countries across borders, the supply chain system has become very heavy with its own complexity. For the same complexity, it has become terribly difficult for buyers to know the real value of products, thanks to the lack of transparency in our current process. In a similar way, it’s extremely difficult to investigate supply chains when there is speculation of illicit or unauthorized practices. The current process hence is highly inefficient for industries as it is very difficult to maintain a seamless process between the vendor and supplier.
How can blockchain help supply chains?
Blockchain is a distributed digital ledger system that has multiple applications that can make any exchange, agreements or contracts for any kind of tracking or payment system. All these transactions are recorded in a block, through multiple copies that are distributed over many computers essentially called nodes making it highly transparent. At the same time blockchain is also highly secure, extremely efficient and scalable as each and every block links to the one before and after it. This ultimately makes blockchain the best solution that can effectively increase seamlessness, efficiency, security, and transparency of the management of the supply chain. The built-in chain of commands makes the process very much simpler right from warehousing materials to delivery and then payment.
Listing down how blockchain is improving the Supply Chain process:
- Making a record of the assets transferred as they move between supply chain nodes.
- It tracks the purchase orders, receipts, shipment needful, and all other supply chain documents.
- Verifying or assisting third-party verification for certifications of properties of the products.
- Tagging each product to numbers or bar codes, digital tags to identify seamlessly.
- Securely share information on the manufacturing process, product assembly, delivery process, and the maintenance of products.
- The complete process is very transparent because documenting a product’s journey across the supply chain increases trust.
- The process has better scalability more than before.
- Enhanced security required by internal systems and processes.
- More than ever innovation creating new, specialized uses of centralized architecture.
Final thoughts –
In this era of digital expanse, companies are taking up the agile shipping process, uncovering ways to leverage improvements to increase profits and improved links across the blockchain-enabled supply chain. Companies are also partnering with state-of-the-art service providers acknowledging the value of security, seamlessness, transparency, and innovation, exploring blockchain’s ultimate potential.