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The managers of transport and logistics companies often call me and ask me: "I do not need to build a blockchain right away?"
They are worried. They are afraid that if they do not "take some blockchain" quickly, their companies will lose a significant new technological progress and will find themselves at a competitive disadvantage.
They are wrong. Their fear is completely based on misunderstanding: a classic case of FOMO, or fear of losing.
Craig
The FOMO effect on the blockchain exploded in trucking due, in part, to the confusion on another hot-button technology, the bitcoin cryptocurrency. This confusion is understandable, because bitcoin has built the first successful use of the blockchain.
But bitcoin and blockchain are not the same thing.
Bitcoin is an application that uses blockchain technology, just like e-mail is an application that runs on the Internet technology platform. The fact that there is no standard definition of blockchain creates opportunities for those interested in exploiting the hype and confusion.
In particular, some disappointing marketers are doing exactly that: promising companies that their businesses could be productive in blockchain in just 30 days. Be careful: when someone is pushing you to join their blockchain immediately, look at your wallet and your data. Data is becoming the new digital currency and companies like Facebook have shown they do not want your money: they want your data. Blockchain is ripe for hidden architectures that would capture all of your data, or the effect of Facebook.
However, there are many good use cases where blockchain could help a business process to create real business value. Walmart has just published its verdant green blockchain initiative, a good spread of the use of provenance to keep track of perishable goods on the market. This would also be useful for cold chain custody applications.
However, do not be deceived when the blockchain is promoted in a situation where it is not really necessary.
Historically, technology-driven applications require investment of time, money and resources, with little, if any, gained in return.
The true business value is created only by technology when it is produced by a solid use case guided by the company. Build a blockchain because it provides a solution to a business problem that you or your supply chain partners face.
In our fourth episode of RoadSigns, we ask: what does trucking towards blockchain mean for an industry that relies on trust between business partners? Listen to a fragment of Ken Craig, vice president of special projects for McLeod Software and co-founder of Blockchain in Transport Alliance (BiTA), and get the full program by going to RoadSigns.TTNews.com.
As someone once said, "Building a blockchain now is like taking the space shuttle for shopping".
Blockchain is not a mature technology in our industry. We do not have the infrastructure necessary to realize the full potential offered by the supply chain. However, the day will come when we will all use the blockchain to further simplify many of our key business processes.
So, what can you do now? Educate yourself. Determine how your business can benefit from the use of a blockchain. Collaborate and develop proof of concepts. Create business-driven use cases that focus on the attributes that blockchain brings to the table, such as the immutable distributed general ledger, the provenance and the smart contracts.
In addition, various blockchain platforms (such as Hyperledger, Etherium, Microsoft Coco) have "starting sandboxes" that allow you to quickly create a proprietary prototype or blockchain. We should do it as part of our learning curve.
But these will not be ready for prime time until at least three things happen:
1.) standards are issued for data, financial payments and interoperability;
2.) Several big loaders are ready to go on with supply blockchain; is,
3.) Some of the current problems inherent in early blockchain are addressed, such as performance, scalability, intelligent contractual reliability and accounting corrections.
This is at least a two to five year process, with some estimates up to 10 years to reach full maturity.
To help the transport industry through this process, in August 2017, Craig Fuller, CEO of TransRisk, founded Blockchain in Transport Alliance (BiTA). At that time, we expected perhaps 25 or 30 members in a year. To date there are about 500 members and we have heard of over 2,800 candidates. This level of interest is a clear example of the buzz surrounding the blockchain in transport. And going forward, this level of interest could have an unintended and positive benefit.
Currently, BiTA is developing a series of open standards for the use of blockchain in the transport sector. Once the standards were issued, these companies and potentially others would represent a group of supply chain partners ready to adopt and use them.
In the short term, do not let deceptive marketing strategies take advantage of the FOMO effect and make you do something you do not need to do yet. Instead, continue to learn, develop cases of use and collaborate. And do not worry. You are not losing.
Ken Craig, vice president of special projects at McLeod Software, is also co-founder and board member of Blockchain in Transport Alliance (BiTA).
