I interviewed Akhil Srivastava who discussed Blockchain as an Enterprise for Supply Chain.
How will blockchainimpact the supply chain?
That's an amazing topic, Dustin. In fact, there is so much excitement, exuberance in the world right now regarding blockchain technology, how it's going to change the world, how blockchain is moving the things around. And if you look at Bitcoin, Ethereum, and all the ICOs coming around, it definitely in the talk of the town, every place.
How I see blockchain going forward is it adds a lot of value to the supply chain in particular. The reason is because in our traditional system of supply chains, the value chain across the suppliers is pretty broken. That means every supplier has their own individual or independent system of records. They manage their own systems using different ERP systems. Some of them SAP; some of them use an Oracle; some of them still work on Excel sheets. And there's a lot of paperwork which comes across when you translate the value from one channel partner or one supplier down the stream. This results in a broken chain of records. And hence, the problem is not having a seamless information flow across the various [inaudible 1:35] of the value chain. That's what blockchain brings as a value of unifying the entire value chain, having one system of records.
What does blockchain bring, uniquely, as value?
That's, again, a very interesting question because blockchain is a pretty nascent concept wherein we see blockchain brings four requisite features which will enable all those facilities of track and trace, facilities of one system of records. And those four features are, A, the blockchain is a pretty asset-light facility. You don't need additional infrastructure or anything. It's only cloud. It's a pretty internet-savvy thing, and you just get the things from the internet onto the blockchain. So that's one.
Second, the blockchain brings immutability with it, which means if one of the stakeholders writes something on the blockchain, it goes by the chain of custody, and it cannot be edited or deleted. And hence, the verification is pretty, pretty easy in the blockchain.
Third, it's a pretty iron-clad system of custody, which is, if you look into, it's a pretty, pretty robust system which cannot be broken across because it goes from one channel partner to another in a very crypted way. It's encrypted messages. And hence, they're hack-proof.
The fourth and the most importatn thing is these are all online real-time business information flow accredited across various stakeholders. And hence, the system of records is pretty much on-time and real-time basis. All these features enable blockchain to help democratize the flow of information and, hence, help receive and provide people information on a real-time basis, which is both verifiable as well as, at the same time, secure because it's encrypted.
What fundamentals have changed that blockchain has become so much of a limelight?
I believe 2008 onwards, the crisis itself was a great understanding of why information flow on a real-time basis is so important. So, for example, [inaudible 4:04], which the world saw in the 2008 economic [inaudible 4:10] meltdown was that the information was in various silos, in various buckets, and not available to everyone at the same time.
So what blockchain brings is it brings single-proof of concept. It brings a single platform to have every information in one place. And that's where it [inaudible 4:35] the typical problem of [inaudible 4:37] spend, which is what we saw when the economic crisis happened — that the same asset was being leveraged two to three times to get loans on it. And hence, the liability and asset had a mismatch. That's one fundamental change.
Second is the world is moving pretty much fast on having a lot of Internet of Things as the instruments across...So we'll have close to 30 billion IoT devices. These devices are all on the cloud. The cloud system, per se, has improved, and when we say one world and network, one connected network, it's what has helped blockchain enable and reach every nook and corner by using the power of internet.
What will be the future of supply chain in advent of blockchain technology?
As we discussed in our previous series, the supply chain 4.0 where we were looking at digitization, well, blockchain will enable digital flow of information, which is one source of truth, which is available to everyone to make a decision and which awaits any fraudulent claims or any biases in the system, and hence, dissolves disputes then and there. [Inaudible 5:55] because everyone who is involved as a stakeholder has the same level of verified and secure information.
That in itself is a very, very empowering thing for the stakeholders to make and take course.
About Christoph Szakowski
Strategy,Sales,Supply Chain,Product Management