How Blockchain Technology Optimize Supply Chain Management
In finance, “blockchain” emerged as a recordkeeping technology utilized by Bitcoin. With authentication and security challenges for the finance industry in a digital world, this technology presents promise by delivering a fast and secure way to authenticate transactions.
Now, the focus is on moving to other industries. The development of trials is demonstrating that blockchain in manufacturing industries has the potential to be unlimited with the capability to build new business models. The major use cases so far come from tracking movement of assets, trade finance, and transaction settlements. One example is TradeLens, a blockchain-enabled digital shipping platform. It has significant shipping players signed up for it, and they’re bestowing data for easy flow of data between various trading hubs. The platform includes more than half the world’s shipping container cargo, and even customs agencies started utilizing this system to verify and clear goods in a faster and digitalized manner.
Aerospace and Defense
This is an extremely regulated industry with excellent compliance standards where a complex ecosystem and deep supply chain poses everyday difficulties to industry players. A blockchain can make tracking transactions over global suppliers easy, thus flagging the way for more accessible regulatory compliance and a better-managed supply chain. It can also be utilized to obtain insights on real-time inventory at supplier sites to avoid out of stock situations.
Blockchain in food manufacturing is viewed as a solution that could exclude or avoid infected food joining the supply chain. Most of the initiatives in this domain are directed at creating trust among customers by giving guarantees on origin, quality, and raw materials.
Pharma and Medical Devices
Blockchain makes it feasible for medical devices or machines to securely share data with concerned parties without violating privacy and compliance. Today, connected health devices create quantities of sensitive data, and blockchain takes charge of all the major concerns encompassing it. It can securely store, record, access, and share data. The technology can also perform a key role in explaining compliance processes for pharma and medical devices, where supply chain traceability takes an immense amount of time and resources.
Small and Midsize Manufacturers
These companies are the backbone of the global economy, and they contribute to the significant share of economic growth. Nevertheless, the majority are financially constrained. They usually fight to access credit based on their movable assets as collateral, and a sizable part of new businesses stop to exist in the first three years due to lack of financing.
This is where blockchain can support by changing the way trade finance works. The system records and validates every step in the supply chain, making it valid for all involved parties. This level of verifiability and accuracy can significantly enhance invoice financing options for this well-deserved segment.
Another function that blockchain can support is smart contracts. It can do away with valuable business documentation practices with automatic execution and implementation of agreements. In a way, it can decrease the benefits gap in large enterprises and flag the way to more competitive trade.
It’s Fit and Future
Blockchain is suitable for each industry that’s high value, high risk, and highly regulated. Its list of advantages is long—from stopping tampering and counterfeiting to precautionary maintenance by recognizing when, where, and how failures happen.