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We have all heard at least a description of what blockchain is, and perhaps that description had something to do with money or cryptocurrency. But blockchain technology has wider applications than cryptocurrencies. In the future, blockchain technology could be a part of many daily business-to-business transactions, including those powered by business applications.
There are many cases of use discussed and it can be difficult to make sense to everyone, but let's look at the following four scenarios that can bring value to businesses. These four scenarios of how the blockchain could work within business applications to provide more flexible, secure and optimized business processes, or even enable new business models.
1. Allowing distributed and autonomous markets
Blockchain allows asset owners to track and exchange valuables, such as pending invoices, in a secure, transparent, private and self-contained "chain" of transactions. reconcilable. This feature adds speed and flexibility to cash and asset management. For example, using invoices verified by Enterprise Resource Planning (ERP) applications, companies could raise money needed quickly or accelerate cash flow by selling invoices on a stand-alone factoring market.
Autonomous marketplaces for other activities will probably multiply. In essence, a blockchain-based transaction eliminates the need for third-party oversight because the software itself is a controlled and open framework that is visible to all transaction participants. Therefore, organizations can view their resources in a multi-dimensional way in terms of value; instead of the nominal value only.
2. Reduce the friction in commercial transactions
Managing spending is a challenge in most organizations. See these statistics by Ardent Partners CPO Rising 2016:
a) Less than half (45%) of the expenditure complies with the contract
b) Only 39% of the eligible expenditure is acquired
c) Only 63% of the expenditure is linked to a purchase order
Alternatively, companies could create a self-managed blockchain network for suppliers and partners. This could allow the automation of smart contracts, instant payments and Internet of Things (IoT) shipments. Without human interaction, errors and missing information are reduced between transactions and transactions take place more quickly because buyers and sellers are now directly connected.
3. Manage and protect decentralized private records with encryption
One of the key features of blockchain is that every single record or piece of data is encrypted. Traditionally, industries rely on third parties to protect databases of their shared information using firewalls and restricted access. As frequent violations of high profile data demonstrate, this practice no longer works.
However, if each piece of data is protected and encrypted with a blockchain member's key, a cyber criminal should have access to each key of each member to access all the blockchain data. This does not mean stating that blockchain makes all data 100% safe, but it certainly can help prevent the exposure of a large number of private records in a single act.
A logical application for this example could be registered by employers and educational institutions. Not only them but also the certification bodies of the sector can add new qualifications, degrees or job positions as soon as they are obtained. Imagine giving an employee a key to access all of his employee records as part of a secure blockchain that also includes human resources. People would be able to share their college transcripts or work with employers or other educational institutions safely and not rely on fax copies of certificates that are unreliable and easy to fake.
4. Monitoring of the provenance of products and materials
Blockchain can help ensure the quality and safety of products by making it easier to track and locate products and materials in use. For example, we say that an automotive manufacturer forms a quality-focused blockchain that includes component suppliers, sub-assembly manufacturers, a quality control provider, and the public regulatory agency. In case of recall of defective parts it would then become much faster and therefore more effective.
Blockchain is likely in your future
These are just four of the many more ways to use blockchain technology. We all need to take some time to learn about the blockchain, and then consider pilot projects that can add value to our business. In some cases, the use of blockchain requires the creation of new business processes or the reconstruction of existing ones using cloud applications. But it is a flexible technology that could benefit any industry.
It will take some time for the blockchain to be present in a large percentage of technology stacks, but technology providers are building paths to facilitate the ramp-up of blockchain initiatives when customers are ready.
(Ajay Kumar, Senior Director, Sales Consulting ERP & EPM, Oracle (India).)
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