Source: Crypto Slate
Adopting Blockchain Technology to Streamline Supply Chain Management
The use of blockchain technology in supply chain management is making huge waves in this era of globalization. Connecting people, products, data and processes on a global scale using traditional methods is becoming increasingly costly, complicated and time-consuming.
Managing a product supply on blockchain technology offers some distinct benefits. Let’s take a look at some specific examples.
A majority of customers are genuinely concerned not just about the origin of their products, but also whether unethical practices like forced labor took place. Offering visibility into a supply chain using blockchain is a great way to inspire customer confidence.
This newfound confidence in supply chain transparency has informed a growing trend among businesses to make use of blockchain technology to offer customers more transparent information into the source of their goods.
A small operator in Denver known as Coda Coffee recently announced its offer of what it refers to as “the world’s first blockchain-traced coffee.” Big companies like Starbucks, Cargill Inc., and Maersk are also reportedly making use of the technology for goods tracking through the supply chain.
Balancing Transparency and Anonymity
Many traders understand the importance of transparency when it comes to supply chain management. They are aware of the value customers attach to knowing where their products originate. But the primary challenge that they have to contend with is offering transparency without revealing sensitive information about their sources.
Innovation Enterprise explains:
“Many larger producers do not want to reveal provenance of their goods for fear of losing a competitive advantage. Blockchain allows information to be transferred in a trustworthy and anonymous way, essentially providing a trust network that allows information to cascade down the chain from raw material onwards, without revealing who people are.”
Blockchain offers the perfect balance between transparency and anonymity, allowing access to relevant information without disclosing unnecessary information.
The distributed ledger system used by the technology creates a permanent record of data entry. Ultimately, it creates a reliable audit trail which provides end-to-end visibility on every step of the supply chain.
The audit trail makes it easy to pinpoint productivity and efficiency gaps that could lead to potential compromise. With such knowledge, one is better placed to build a proactive rather than reactive stance, ultimately reducing or eliminating delays.
Having a product supply managed by such a reliable system will undoubtedly reduce the occurrence of the fraudulent activity. This reduction will go a long way in protecting the finances.
Boosting Brand Image
Blockchain technology can alter brand perception and create a much better reputation. When revelations of supply chain malpractices hit the news media, they usually create a PR storm. Reports of child labor and human trafficking cast companies in negative light whether or not they were aware of the fact.
The reverse is also true; if a business can prove that the products they deal in have an ethical source, this goes a long way in building the brand and a positive perception from the public. It will also show compliance with the regulations that require companies to offer transparency in their supply chains – a competitive advantage as it is still the exception rather than the rule.
Efficient Data Control
The global commerce model calls cooperation between various stakeholders in any given industry. Ordinarily, the only way for these stakeholders to reach agreements is to introduce an intermediary who will facilitate trust, which significantly delays the process and inflates costs unnecessarily.
Using blockchain technology makes it possible for all stakeholders within an industry to access the information they need. The data sharing is made possible without the need for a third party since all data within the network is synchronized and therefore easy to verify.
The Fr8 Network makes use of blockchain technology to eliminate the role of the intermediary from the trucking industry. The system offers the missing link between shippers and carriers, introducing transparency and removing the current costly arbitrage.
It is breaking down the information asymmetry that currently characterizes the freight industry, offering everyone the opportunity to access pertinent data and make informed decisions.
The use of blockchain technology to manage a product supply chain is a superior way to create a stronger bottom line. This new tool is in keeping with the digital revolution as well as globalization.
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