How do you know that you should use blockchain technology for your business?
If you keep even half an ear trained on tech news, you’ll have heard big talk about the blockchain. Talk of the blockchain and its far-reaching applications are hot topics at the moment. And it’s not just talk either. There’s been bona-fide activity to bolster those claims that blockchain is indeed the next big thing.
Following the lead of the biggest names in IT, more than half of companies are talking about delving into blockchain in some form or other. It’s stirred the gears of developers everywhere, while sellers are getting set for sales boom. And of course, the appetite of customers is there too. Like all good things, people are keen to capitalise on this technology early and strike while the iron is hot to ensure the meatiest profits and reap the biggest benefits.
Enticed by all the talk and keen to know if blockchain technology can benefit your business? It’s easy to get caught up in the hype and misappropriate the benefits to you, but it’s relatively simple to discern whether or not your company could take advantage of the blockchain and effectively incorporate it. Below, you’ll find some handy insights to help you make a decision about potential next steps.
Blockchain explained
To define it simply, the blockchain is a transaction platform. On this platform, multiple parties collaborate to make the transaction process an easier one. Entries made on this platform are unchangeable and decisive, and its this finality that encourages participants to develop a significant degree of trust in one another.
The blockchain has now passed the point of being an appendage to the crypto boom. We can now step back and assess how it can be successfully utilised in everyday applications. However, before we can assign blockchain uses to individual business processes and sectors, we need to consider what key functions and concepts the blockchain has to offer. In addition to the shared ledger aspect of the blockchain, there’s also smart contracts, consensus mechanism and permissions to consider.
Knowing the business process intimately is crucial in order to effectively implement blockchain technology. A thorough understanding of how a business operates and what transactions are carried out is a must. If there are any shortcomings in your knowledge of these areas, it’s time to polish up on some detail before progressing further.
Examples of how blockchain is currently used in business
Today, there are numerous blockchain projects in operation and the uptake looks set to continue. To better understand the capabilities of the blockchain and how they might be applied to your case, it’s worth looking at how it is currently applied to various industry sectors.
One area where blockchain is successfully utilised is in supply chain tracking. In particular, the food industry has found a use for blockchain and its innovative capabilities, helping streamline the tracking process of product and making the whole operation altogether more easy. The end result is that supply chain operation is both faster and more cost-effective. What’s more, successful application can improve overall food safety measures, reduce the incidence of issues where companies have fallen foul of regulation, not to mention slash incidental administrative costs.
In regards to manufacturing, blockchain technology can be very effectively utilised. Individual parts can be tracked and traced from the manufacturer itself, throughout every point of delivery until arrival at a factory where said parts will be used. What’s more, it can be used to securely track and store useful data regarding individual parts and performance of said parts. This results in an incredibly comprehensive and useful record of a part and its individual life-cycle. There are more applications to consider from this. For one, it’s easy to identify any suspect or faulty parts. Not only this, any problems caused by said faults can be honed in on incredibly quickly with a higher degree of accuracy.
There’s also application relevance for high-end luxury goods. Think about fine wines, designer watches and precious stones. With blockchain technology, not only can authenticity of these goods be made certain, any costs accrued from having to deal with fraudulent dealing and counterfeit goods coming into the chain can be drastically slashed. With blockchain, it’s simple to store a detailed cross-section of items, whether that be high-definition imagery of said products, certificates of authenticity and proof of origin and so on. This validation need not take an age with blockchain. Rather, the verification process is truly the work of moments.
Dating sharing potential of blockchain
In the context of a business network, blockchain can offer a way to create secure sharing of sensitive data. This is allowable thanks to permissioned ledgers. An example case might be where multiple entities need to share customer data deemed sensitive. In such a case, network cooperation is a must. A real-life sector that would benefit from this application of blockchain would be banking.
Faster validation process
Companies within the insurance sector would greatly benefit from adapting to blockchain. At the moment, the validation process of individual claims is a lengthy one, requiring potential claims to be passed through multiple parties. With blockchain implementation, the overall process can be streamlined due to the use of as hared ledger. It can also be automated with the application of smart contracts, while overall levels of security can be improved upon. Case studies like this show how blockchain implementation can be a win-win.
Will blockchain benefit your business?
Now you’ve considered all of the above, you’ll be closer to knowing whether or not blockchain can bring benefits to your business operation. Still not completely sure as to whether it’s a match made in heaven? We’ve put together a few pointers to help you make a more concrete decision.
Identifying assets
First, ask yourself what is the asset you’re looking to transfer over a network. Is it standard information sets? Data? Tokens? It might also simply be a digital reference for an actual product located physically elsewhere. In the manufacturing industry, said asset could be individual parts. In an insurance context, it might be records of patients filing a claim. Once you’ve identified the asset you’re dealing with, you can begin to consider the larger design of your network. You need to underline the factors that are of chief importance to you. If things like finality, immutability and trust are a must, then blockchain adaption is certainly something you might benefit from.
Identifying business participants
Effective use of blockchain use usually entails a network of participants that are actively exchanging assets, viewing assets, or modifying them. These participants might be your business partners, your customer base, your suppliers. They might also representatives from a regulatory body or state institution. Basically, any party you interact with on a day to day basis.
You need to ask yourself whether you’re dealing with participants who would be keen to follow you onto a new network. Can you argue the benefit of blockchain migration to them with quantifiable benefits to sell the argument?
What activity will occur on the network?
Now you need to think about what sort of transactions will be occurring on the network in question. Are you looking to create new entries and publish them to allow other participants to view them? Do you need to transfer assets and change ownership? Are you requiring smart contracts? Gaining a deep understanding of the process in question is a perquisite here and will better inform you as to whether you’re suitable for blockchain implementation and more importantly, ready for the change.
What processes will you require?
Consider the kind of processes you might need to ensure enhanced efficiency and produce solutions for overcoming the apparent problems your business operation is facing now. This is a broader exercise for you to undertake, one where you’ll need to delve deep into the ins and outs of your business operations and consider whether or not they’ll be able to migrate effectively within the blockchain.
Permission model requirements
When it comes to establishing a consensus and permissions model, you need to consider several questions. Firstly, you need to decide who will have access to data on the network. You’ll need to decide who can make changes to any data. You will also need to finalise on how you will agree upon permissions within the network and distribute said permissions.
Taking the next steps
All of this might seem exhaustive, but it’s essential reading in order to make the steps toward incorporating blockchain into your business with successful results. Ultimately, you first need a clear insight into the requirements of your business before you can decide on how blockchain can benefit it. Don’t be duped by the hype surrounding this new era of technology and understand that, ultimately, it might not even be suitable for your needs.
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