3 ways blockchain can revolutionize global supply chains

Unsplash vegetables.jpeg

(Unsplash)

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Emma Charlton, Senior Writer, Formative Content


Farm to table. Fair trade. Ethically sourced. These recent trends are evidence of consumers demanding to know more about the products they’re buying – from who made them to how they were sold.

At the same time, the modern supply chain is global and complicated. While unlocking the potential to share goods across the world, globalization has also created inefficient processes that can involve hundreds of stages, multiple countries and numerous parties in each transaction. The resulting system is one that is difficult for both customers and service providers to navigate.

 

One technology has the potential to disrupt supply chains and create more efficient processes: blockchain. We won’t get in to technicalities in this post (you can do that here) – but blockchain has important qualities that hold a great deal of promise for supply chains, including a high level of transparency and auditability. “On the surface, the supply chain of the future very likely looks like those we know today,” a new report from the World Economic Forum states. “Yet under the covers, we can anticipate far-reaching changes that enable better communication, fewer disputes, higher system resiliency and substantial gains in operational efficiency.”

Noting its potential, some of the key players in the industry – from governments to start-ups to multinational corporations – are looking into blockchain solutions for a variety of uses. Here are three potential applications.

1. Product provenance and traceability

Whether they’re buying food or diamonds or car parts, consumers are looking for ways to prove the authenticity of items. Since data can be made visible to all participants who have been authorized to view it – and in general cannot be altered by a single entity – customers can have confidence that data has not been tampered with along the way. On top of this, time-stamping can provide a single source of truth on the product’s history, from the harvesting of the materials to the shelving in a store. Knowing the full journey of a product comes with several benefits, including improved product safety, a reduction in fraud, and an increased accuracy in forecasting and collaborative planning within the industry.

To give an example: in 2018, the US faced its largest E. coli scare since 2006 when 210 people became ill and five died due to infected romaine lettuce. The panic resulted in a widespread recall of stock, until the Centers for Disease Control and Prevention were able to pinpoint the source as a producer in Yuma, Arizona. Blockchain, however, would enable a complete knowledge of each lettuce’s history, so details from the initial cases could be used to quickly pinpoint the outbreak’s origin. Rather than a widespread recall, only those with the potential for E. coli infection would have been taken off the shelves.

This isn’t a far-fetched scenario. Companies like Louis Vuitton and Nestle have already announced efforts to track everything from luxury goods to baby food using blockchain.

2. Streamlining (global) supply chain operations

Any given product moving through a supply chain can pass through hundreds of hands. Since many of these processes are manual, it’s difficult to achieve end-to-end integration of data documentation. Instead of the murkiness caused by a chain of bilateral interactions, there would be multi-party access to data and documentation, allowing for increased efficiency. In fact, with new access to information within the supply chain, there may be opportunities to repurpose information or use it to make better business decisions for all involved.

Image: Blockchain Council

In fact, blockchain may be the key to unlocking “paperless trade” – a concept that may seem elusive in a document-heavy system. For instance, solutions now exist to digitize and automate the “bill of lading” – an essential trade document that is largely processed manually. Under previous iterations of the system, all parties involved in the transaction would have to physically sign the document to indicate the goods had switched hands. With this system, a signature could be disputed or not having a pen could delay the transaction.

Large port community systems, such as the International Port Community Systems Association, are already looking into blockchain-based approaches. Under the new model, transactions can be templated and executed seamlessly between multiple parties, on an interface that looks like an email inbox and is backed by cryptographic signatures.

3. Anti-corruption and humanitarian operations

Because every transaction builds on previous transactions, corruption may be more readily visible to network participants. This higher level of accountability creates barriers to players behaving opportunistically or unethically. The full audit trail of spending could also be useful in humanitarian settings, particularly where financial aid was not reaching – or was perceived not to be reaching – end-users.

Imagine that someone does want to behave fraudulently and skim 10% from donations. Though the transaction could take place, the delinquent actor would not be able to delete it from the decentralized record. The record would allow the organization to: 1) register that the full amount did not reach its intended recipient, and 2) follow the audit trail to the fraudulent actor.

Could tracking products through blockchain reduce instances of food poisoning?

Could tracking products through blockchain reduce instances of food poisoning?
Image: Unsplash

The World Food Programme has already begun experimentation with this use case in the Azraq refugee camp in Jordan. Under the Building Blocks pilot project, 10,000 individuals receive food from entitlements recorded on a blockchain-based computing platform.

So what?

Blockchain is poised to upend the way we consume – from what we wear to what we eat. As solutions come to the fore, it’s vital they’re deployed in a responsible manner, because with all these hopes come fears over hype, data security, interoperability and access.

As with other technologies, this doesn’t happen accidentally. It’s designed. That’s why we’re teaming up with over 95 individuals from around the world to co-create decision-making tools for supply chain actors. The goal? Moving supply chains towards solutions that are inclusive, are interoperable and have integrity.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

How to get young people in Europe to swipe right on voting

EU Commission: Growth first then fiscal consolidation

Brexit effect: Public opinion survey shows that EU is more appreciated than ever

Forty-two countries adopt new OECD Principles on Artificial Intelligence

Innovation can transform the way we solve the world’s water challenges

Israel @ MWC14: Israel The Start App Nation

Globalization 4.0 must build a better world for working people

Take medical use of cannabis seriously, say MEPs

Facebook wins EU approval for WhatsApp acquisition; just a sign of the times

What lessons to draw from the destruction of Syria

The Fourth Industrial Revolution must not leave farming behind

WEF Davos 2016 LIVE: “We need more Schengen but reinforce control!”, France’s Minister of Economy Emmanuel Macron emphasises from Davos

Can the EU last long if it cuts Cyprus out?

5 ways blockchain can transform the world of impact investing

Seize the opportunities of digital technology to improve well-being but also address the risks

Breaking news on European Youth Employment: European Youth Forum Guide tackles poor quality internships!

Turkey caught in a vicious Syrian circle bringing terror and war at home

The Parliament rejects cultivating the wrong seeds of the Commission

EU free-trade agreements with Canada and US: imagine the fallout if put to national referendums

Half of all mental illness begins by the age of 14

Gender Equality as a platform to improve Medicine

Hydrogen isn’t the fuel of the future. It’s already here

Prosecution of Paraguay judges over peasant ‘massacre’ ruling could undermine rule of law: UN expert

EU migrant crisis: Germany, France and UK to show the way. Will the rest of the EU follow?

Eurozone: Even good statistics mean deeper recession

These patients are sharing their data to improve healthcare standards

In Washington D.C., Guterres signs pact with World Bank, meets US President Trump

Why today’s leaders need to know about the power of narratives

Tuesday’s Daily Brief: hate speech, dementia, Libya and Yemen, human rights in Brazil and Lebanon

Health conditions for citizens of Yemen’s key port city ‘remain critical’ says UN agency

Cancer research put at risk by General Data Protection Regulation? The possible dangers of a data privacy EU mania

Latin America is a mass-transit powerhouse. But it needs fine-tuning

Clean energy will do to gas what gas has done to coal

The ITU Telecom World on 14-17 November in Bangkok, Thailand

Migration: Better travel safe than sorry

Margrethe Vestager, EU Commissioner in charge of competition policy, during a recent press conference in Brussels / Berlaymont. (Copyright: EU, 2018 / Source: EC - Audiovisual Service / Photo: Jennifer Jacquemart)

EU opens investigation into Qatar Petroleum over potentially restrictive gas contracts

Why exchange programs are essential for the medical students of the 21st century

DRC ‘calm but tense’ as country awaits presidential election result

Trump’s trade wars: Aiming at long term gains for America

Refugee crisis update: EU fails to relocate immigrants from Greece and Italy

A Valentine’s Special: we can never overdose on love

Brexit update: Leave campaign leads race but undecided voters will determine the outcome of the EU referendum

Western Balkans: European Parliament takes stock of 2018 progress

The miserables and the untouchables of the economic crisis

UN chief urges India and Pakistan to dial down tensions in wake of Kashmir attack

Climate change and its adverse impacts on health

“ASEM: Global Partners for Global Challenges”, a Sting Exclusive by China’s Ambassador to the EU

FROM THE FIELD: Rohingya babies conceived out of ‘incomprehensible brutality’

Egypt is building one of the world’s largest solar parks

The EU Parliament sidesteps the real issues about banks, while the US target the Eurozone lenders

The unpleasant truth of plastic straws

Social Committee slams the 28 EU leaders for false promises

UN chief condemns suspected Boko Haram attacks targeting Eid al-Fitr celebrations in Nigeria

The historic accomplishment of a seamless EU patent and intellectual property space

The Syrian knot cannot be cut without devastating consequences

Who is culpable in the EU for Ukraine’s defection to Russia?

Civilians ‘must never be a target,’ says UN in Afghanistan, amid troubling number of casualties during Ramadan

Can the US-Iran rapprochement change the world?

UN chief calls for Security Council to work with Myanmar to end ‘horrendous suffering’ of Rohingya refugees

Energy Union: EU invests a further €800 million in priority energy infrastructure

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s