Blockchain technology holds a lot of promise for businesses and supply chains looking to increase efficiency and reduce costs. With the effects of globalization, supply chains have become complex—and broken. There has been a lot of noise about blockchain’s potential to solve the very core problems of traditional supply chains—reliability and integrity. But has anyone actually used blockchain and gotten the results they were looking for?
After people got sick with food-borne illnesses originating from lettuce and spinach sold in Walmart stores, Walmart had to clear out all the shelves in the green leafy vegetable aisle. Since they were unable to pinpoint which batches were contaminated, they needed to throw out good produce along with the bad. Looking for a new way to react more quickly to recalls and to not waste perfectly good produce, Walmart partnered with IBM to implement the Hyperledger blockchain to track all food produce, including Chinese pork. Although the blockchain Walmart adopted has nothing to do with Bitcoin or any cryptocurrencies, they are currently using it to ensure high quality produce for their consumers.
Even before news of “blood diamonds” broke out into the mainstream, it has always been difficult for jewelers to verify the authenticity of the gemstones they sell. In recent years, consumers have become aware of diamonds being mined and smuggled out of conflict zones throughout the world. DeBeers, which controls about 35% of the diamond market, has reacted to this by turning to blockchain technology to track diamonds and other gemstones along their supply chains from the mines to their stores. Other jewelers have begun using TrustChain, Tracr, and IBM’s blockchain cloud services to assure their customers that the gemstones they are buying are authentic and do not originate from war-torn areas.
In 2017, British Airways began testing blockchain as a way to store flight information in a decentralized database. Their problem was that conflicting flight information kept appearing in gate monitors at airports, flight apps, and airline websites, thus confusing air travelers. The root of the problem lies in the fact that airports, airline websites, and flight apps often use different databases and IT systems. Entering or modifying data using fragmented IT systems almost certainly causes errors and confusion. By keeping immutable data with one distributed source, data could remain consistent across airports, websites, and apps, thereby eliminating conflicting flight information that occasionally cause travelers to miss their flights. Flight data management is now emerging as a strong use case for blockchain, with some airlines including British Airways already adopting the technology.
By 2025, about 10% of global GDP will be stored in the blockchain industry, according to a prediction by Deloitte. Whether or not you agree with this seemingly aggressive forecast, many large companies such as British Airways, DeBeers, and Walmart are now turning to blockchain to address their supply chain problems. Particularly for companies dealing with supply chains, the big business question they will need to ask themselves is whether or not they need a blockchain to resolve increasingly important issues such as trust, transparency, and control over their data.