The Anatomy of Blockchain Deployment

An immutable time-stamped series record of data that gets managed on a distributed network is Blockchain. This technology was first implemented in 2008 by Satoshi Nakamoto, and now after 11 years of progress, it has achieved as one of the most secured technologies having hands-on almost every sector of the economy. The reason behind this reliability is its architecture, which is quite complex to understand.

So let’s move forward to learn architecture, different components, and the process involved in high-security technology Blockchain.

Various people mislead blockchain as bitcoin currency only, but there is a lot more under the umbrella of blockchain. It uses a peer-to-peer network of computers to validate the transactions in the block. This technology works in an open network that has no central authority. That is why the information in it is open for participants and everyone to see, which is called transparency.

Building your blockchain solution is not so complicated, all it takes is complete knowledge of its architecture and core components. The technology has core characteristics of accountability, reliability, and decentralization.

Planning of Blockchain

Blockchain is the spine of Digital Cryptocurrency Bitcoin. To understand the architecture, it is necessary to have a brief knowledge about the technology. Blockchain is a decentralized distributed ledger of transactions among the network of computers. The transactions done by the user are verified directly without a central authority.

If you want to implement a customizable blockchain solution, programming languages such as C++, Python, C, Java, and Ruby are needed. Besides, web development skills like HTML, CSS, Node JS will give handy experience. Blockchain has three pillars of success.

  • Decentralization: It is a process of distributing the power of central authority for every small transaction. Every single user wants to get an opportunity to become one of the network’s many decision processors.
  • Transparency: Who doesn’t want crystal clear water? Just like the same blockchain provides unparalleled transparency to the valid ledger. Users can check these records as per their convenience.
  • Immutability: There was a need for a technology that gives security to the database from insiders too. Blockchain provides the ability to ledgers to remain unchanged, unaltered, and indelible as blocks of data cannot be altered.

How is Blockchain distributed?

Blockchain is distributed in three types of networks and subdivided further. Just like the image is showing different nodes, the same concept is.

Distributed networks are further divided into two types of networks that work on the same terms with few differences.

Public Distributed Ledgers: Just like any other public access here also anonymous users can get into multiple nodes of the network for decision making.

Private Distributed Ledgers: On the other hand here users are not anonymous who are getting into multiple nodes of the network for decision making.

What are the stages of the transaction?

Blockchain follows a hierarchy of processes for the transactions in the network. These stages are necessary for the data in terms of transparency and immutability.

Transaction Requested
The process starts from the user end where he/she will put their request. The request made is for the transaction of anything like a financial transaction or any data to be recorded in the ledger, etc.

Block created
The request then sent to the block that would represent the transaction. In the blockchain, data is stored in the form of blocks and linked to each other in the form of a chain, which induces the word blockchain.

Block sent to the network
This block carrying the request is sent to every node of the network. One of the pillars of blockchain stated here, i.e., distributed. This block gets distributed on different nodes of the network to verify and ensure the security of the request.

Transaction validated
Once all the nodes receive the block, they then validate it. Block gets validated by every node distributed among different computers, and after verifying every object, moved forward.

Block added
After all the validations from every node, the block gets the reward and then added to the existing blockchain.

Completion
Now comes the final stage, where the block has crossed all the hurdles and completed the transaction of the user.

Layers of Blockchain

The Internet has seven layers for data transmission and security, and so is blockchain. Blockchain is one of the most secure technologies in the digital world, having three different layers for its services to us.

Cryptocurrency has given the experience of security to the next level in the country, out of which Bitcoin has come up to shine.

As every cake has a creamy layer, the same blockchain stack has its foremost creamy layer as Overlay Network. It includes various protocols for auditing services:

  • Proof of Process
  • Proof of Existence
  • Proof of Audit

Decentralized protocols are with built-in data as we can develop the open-source technology. Due to overlay networks and the Blockchain, validation, and transactions didn’t get controlled by a single entity.

Open-source APIs are publicly available for all developers for accessing their data. It allows the developers and outside workforce to access the backend data to improvise their applications.

The application layer is more consumer part of the stack. Generally, applications built in this layer are similar to each other.

Components of Blockchain

Every ecosystem has organs that give functioning to it. Blockchain ecosystems have the following components.

  • Node: This represents the user or the system that is involved in the blockchain.
  • Transaction: The smallest building block present in the blockchain system.
  • Block: It is used to keep a set of transactions as a data structure that gets distributed to all nodes on the network.
  • Chain: Blocks that are linked together in a specific order, form chain.
  • Consensus: As everything needs to have rules and arrangements to carry out their operations so as the blockchain.

Let’s discuss in brief about some of them and a few others also:

Node Application

In a specific blockchain ecosystem, for participation, every internet-connected computer related to that particular blockchain ecosystem has to install and run a node application.

Distributed Ledger

The database can be synchronized, replicated, and shared among the members of the decentralized network and is available for the participants of that particular blockchain ecosystem.

Virtual Machine

An extraction of machine set off with instructions and implemented as part of node application that is run by every participant in the blockchain ecosystem.

Consensus Algorithm

It is essential for deciding the functioning of the blockchain and its extension in the future. This algorithm provides security and stability to the data in the blockchain.

Blockchain architecture serves various benefits to organizations and enterprises:

  • Data Security: Once data entered, it is hard to alter it in the database.
  • Cost Reduction: With the growing cybercrime, lots of money is spent on data security. Blockchain structure is sustaining the security at a low cost too.
  • Flexibility of Data: Blockchain is a distributed data structure, so it can be retrieved any moment from the distributed network.
  • Every time a transaction is requested, a new block gets built within the blockchain. Each record is digitally signed and rewarded to ensure its transparency. It then gets verified by the majority of nodes of the system and then added to the network.

Implementing the blockchain solution

Blockchain is a decentralized distributed network and for creating a solution, there are few steps involved within it.

Step 1: Identifying the Use Case

The foremost and crucial step for any software is identifying the use case. The same is for blockchain implementation, the key to development is to figure out the problems, target audience, and solution for the same. Various problems will come in mind when researching the problems, and that will add clarity to the goals.

Step 2: Choosing Blockchain carefully

There are a lot of varieties in the market for technology. Sometimes it becomes very difficult to choose the type of technology for your dream business solution. Some of the popular blockchain platforms that are available in the market are:

  • Zeeve
  • Hyperledger Fabric
  • Quorum
  • Stellar
  • Corda

It is very important to do proper research work on these platforms too and, make sure that it will suit your budget and possess the quality that your solution needs. You can also take advice from someone who has prior experience in blockchain, and that can be any person in any company.

Step 3: Initializing the Blockchain

We have already discussed the process of blockchain earlier above, and that process is necessary to get followed by the data. To initialize the blockchain solution, it is advisable to create the first block manually. The block should possess the features of the chain and then share it at all nodes of the network system.

Step 4: Choosing the Right Consensus Protocol

These protocols refer to the mathematical problems that require large calculations. They create an undeniable system of agreement between systems and networks to prevent the system from exploitation, hacking, spam attempts. There are a variety of protocols like:

  • Proof of Stake
  • Proof of Work
  • Proof of Weight
  • Delegated Proof-of-Stake
  • Byzantine Fault Tolerance

Step 5: Building an Ecosystem

Creating a community within the industry or an organization is very helpful in understanding the technology and its potential to improve the trust among the businesses. An ecosystem does base on belief, and in the blockchain ecosystem, it is very necessary as it involves a large number of stakeholders in it.

Step 6: Designing Deliberately

The design had the power of attracting the crowd. Blockchain solution needs to get designed properly as there is always a possibility of updating it in the future. The process of the solution needs to be revised to lay preliminaries for blockchain.

Step 7: Navigating Uncertainty

Blockchain is still new in some sectors. You should be ready every time for making changes in the framework and the challenges for regulatory approaches. A certain change is anything can reshape the whole solution.

Blockchain technology enables organizations & companies in the following ways:

  • Blockchain protects from cybercrimes, electronic crimes, hacking, etc.
  • It helps in introducing modern digital interaction.
  • Reduction of cost due to the removal of intermediaries, inefficiencies, and duplications.
  • Quick transactions with trust.
  • Detailed control over transactions and business processes.

Initializing a blockchain solution is not an easy task. It can be a little frustrating in starting, but later on, you will realize this is more successful than expected. This is a new technology, but in the future, it can create various possibilities in the success of your organization.

Blockchain helps in running daily operations more easily within a defined network. From the legal outlook to technical terms, blockchain ledgers had made a connection between involved parties only. This technology ensures control over the privacy and security of data in the system over time.

Trading with Blockchain in Energy Market

Technology to empower renewable energy to enter the trade market with trust.

Being a part of nature’s culture, we all know that renewable resources are limited. These resources are diminishing day by day as it takes millions of years to renew them. Humans have taken out various solutions to use these sources of energy wisely. Out of them, solar systems are the most widely used invention. In a world full of needs, humans are helping each other with these resources. And they had entered the trade market for this. The trade market developed on trust and transparency, which is ensured by Blockchain.

conclusive reprise

A Noida based startup- Sofocle Technologies has come up with a technology named Ojus to develop a link between peers for easy and clear trading of renewable electric energy. Sofocle aims enterprise solutions for real business problems through brainstorming blockchain concepts to ensure security and efficiency. This blockchain-based solution will help in transforming the trading and distribution of Electricity by using peer to peer distributed ledger and smart contracts.
Ojus is aimed at features and advantages of Blockchain as it is one of the finest technologies in the world to date.

  • Transparency
  • Enhanced Security
  • Cannot be corrupted
  • Distributed ledgers
  • Faster monetary settlement

Ojus is a peer to peer energy sharing blockchain-based solution. It was introduced to streamline the process of trading of electrical energy sources from producers to consumers. It has been developed using HyperLedger Fabric Protocol and uses Smart Contracts for digitizing the processes.

The energy produced is generally sold at a lower price than the optimal price to the consumers because of which profit is earned by both parties. This creates a transparent relationship between producer and consumer without the involvement of any intermediary.

Through Ojus, electricity subscribers can securely sign in to their accounts, set bids, and quote their price for locally generated energy. A separate portal for distribution utilities is available for user and meter identity management. The platform also generates reports displaying total settlements, total units produced and consumed via tokens.

What was Scenario before Ojus?

It’s not like energy was not shared before Ojus, there were few problems between producer and consumer.

  • No transparency
  • Slow steps to the digitization
  • Trust issues
  • Unsure monetary transactions
  • Involvement of intermediaries

Everyone needs a system that can induce every problem in the digital world.

How is Ojus a good practice?

Every technology is invented to ease the life of humans, but few technologies are there for nature as well. Ojus is a technology that is made for both nature and its creation of humans.

⦁ Regenerate the used
Nowadays, every second person is installing solar panels on their rooftops to regenerate solar energy. This has deteriorated the demand for electricity. Solar panels absorb the energy from sunlight and then generate electric energy from it. Electricity is non-renewable energy and, once this source was scarce. Through this platform, we can spread awareness of solar panels as well as the scarcity of this important source of life.

⦁ Sharing is caring
Ojus encourages the sharing of energy sources because sharing is one of the important life’s ethics. If the energy gets generated in high quantities, then you could share it with your neighbors who don’t have this source, and it will help them and nature as well. Rather than sending it to the grid, it’s better to share it with your neighbors.

⦁ Avail the basic
Not everyone near to you is rich enough to avail of these basic services. Few people are there who are not able to take them on the government’s price. If you have enough solar energy, you can easily trade to unprivileged at a low price.

⦁ Money is everything
Yes, money is everything and what if you are getting it without any hard work. When these energy units get traded, then ultimately, what you receive in return is money. Solar panels are a one-time investment, and then you can save your money and earn them as well.

Ojus has achieved success by a partnership with TERI (The Energy and Resources Institute). “The successful deployment of this prototype would help in scaling up the adoption of rooftop solar in the domestic consumer category,” according to Alekhya Datta, fellow and area convenor, TERI, who conceptualized and led the development of this prototype after TERI’s pitch for the same won accolades at the Global Blockchain Congress at Kolkata in December 2018.

Blockchain has its benefits in the energy sector:

  • Cost Reduction
  • Sustainable to environment
  • Transparency for Stakeholders
  • Profit for everyone
  • The smart contract builds blind trust

Ojus, a blockchain-based power distribution system, is built and already deployed. The platform covers a configurable number of units produced and the complete tracking down the entities. Each unit generated is traceable, which helps the end-user to gain from the system.

Future of Ojus

Ojus is not only a smart technology, but it’s nature-friendly also. All needed is to spread awareness among people about solar energy trading. Behind all this, blockchain is building trust as a spine of the system.

Ojus have their advantages and to earn them book a demo today.

Challenges in the Enterprise Adoption of Blockchain

Sofocle is known for its Blockchain Evangelism, deep-rooted research, and pioneering when it comes to this technology. It is only natural for the company to raise awareness about the real challenges shadowing the enterprise adoption of Blockchains like slow transaction speeds, lack of standards and interoperability between different platforms and solutions, legal and regulatory concerns around data privacy and intellectual property, production/enterprise-grade deployment automation is one of the major challenges as well and the technical complexity involved, while busting the myths behind this potential but unproven emerging technology.

At the NASSCOM Product Connect Virtual Panel Discussion held on 25th June 2019, our three distinguished panelists who had an erudite discussion on the challenges of Enterprise Adoption of Blockchain, pointed out the major reasons why Blockchain has a long way to go in terms of its enterprise implementation.

Mr. Irfan Khan, Digital Economist Hypermine, articulately delineated some of the concerns which include,

Bitcoin as a standard is the first generation of Blockchain DLT. Initially, public Blockchains were created without enterprise requirements in mind. Thus, the aspect of privacy was not given much importance. Existing competitors like Visa and Mastercard have faster processes that prioritize privacy. The learning curve of cryptography and decentralization is slower.

Evolved DLTs like DAGS and HashGraps make it possible to achieve speeds above 100,000 GPS and speeds of 150-200 Mbps per node. The performance will soon reach enterprise-grade as expected by consumers and CIO with emerging technologies that should be performing. The fact of the matter remains that government support and more adoption by more enterprises are still lacking.

Availability of Talent is another issue where not enough developers, consultants, research scientists are available and not enough research papers are out to support findings on how this rapidly growing technology can be deployed in enterprise environments.

Blockchain is in the most preliminary stages of the technology life cycle where technology experts believe that it is still unstable for enterprise adoption. The evolutionary stage is the worst time to invest and thus all the enterprises are waiting to see which the best time to get good ROI is and that the technology does not become obsolete within one or two years.

With platforms like Hyperledger and Ethereum coming up with so many types of consensus, no definitive standardization mechanisms are in place currently.

Mr. Ravi Chamria, the CEO of Sofocle delineated the challenges of adopting Blockchain at an enterprise level with a focus on three key aspects, namely,

Security and Usability

One of the hallmark features of applications or networks on Blockchain is digital identity. A person or user can be identified by full authenticity on a Blockchain through digital identity. A specific user who has performed a transaction can be identified and verified on the system which helps in obtaining the timestamp and the details of the user, and in managing disputes and auditability of transactions.

The identity is based on a public-private key pair and the major problem is that of storing and managing the private keys at the user level to sign any transactions. In a proper decentralized system, this private key needs to be stored locally so that it is not available to anyone else. It is difficult for a non-technical user to manage the keys. Tools are still being built to support easy management by such users.

Transaction interfaces or technical interfaces are required in Blockchain for a normal user to comprehend. These interfaces depend on the complex architectures which are difficult for a normal user to understand.
The third challenge in usability is building connectors with legacy applications. In the enterprise domain, Blockchain is a layer that interacts with multiple applications like supply chain, ERP, automated claims management system, etc.

The identifiers on the enterprise-level application systems need to be compatible with the identity that is designed on the Blockchain system. The transaction verifiability and finality have to be defined or structured in an application for seamless interactions with the Blockchain system. Plug-and-play connectors need to be designed in Blockchain so that existing applications can be used without impediments. Data, user identity, access control, and specific set of transactions need to be coordinated between legacy enterprise applications and the Blockchain ecosystem using pipelines.

Network Deployment and Management

The next set of challenges lie in the DevOps area which requires clear coordination between the technology and business teams. Owing to the complexity of a Blockchain application, with decentralized nodes in Blockchain, some of the nodes are hosted outside an organization by external parties. Managing the deployment of such networks with a different set of permissions and privacy controls, to be managed in a single interface is a major challenge that IT teams face today. Manual deployments take a long time, thus, automating it becomes necessary requiring expertise. There are chances of error while defining access control and privacy. Having multiple protocols like Hyperledger Fabric and Hyperledger Sawtooth in the market today increases the complexity of managing Blockchain networks since different applications are built using different protocols.

Onboarding of new partners, multiple cloud players or nodes on an existing Blockchain network is another blocking factor in the enterprise adoption of Blockchain because of the requirement of technical expertise. Automation during this process is another pressing need that has to be addressed.

The final usability challenge lies in Benchmarking and Monitoring. Since only production-level deployments have been observed more, benchmarking data is not available. Monitoring Blockchain nodes outside an organization, cost-control, and managing exigencies that happen on an external network are three aspects that give enterprises limited autonomy.

Lack of Optimum Blockchain Expertise

In terms of education and Blockchain expertise, incremental innovation is backed by mending of broken processes or strengthening of existing processes. Due to the inherent lack of trust or data integrity among organizations, defining new business models is taking a serious blow. The know-how of sound token economics which is core to Blockchain needs to be shared among technical experts and Blockchain experts of different organizations. An incentive structure for each party has to be designed clearly to join the network. Transformational innovation involves transforming the entire process itself.

Dr. Vishwas Patil Research Scientist, Center of Excellence Blockchain, IIT Bombay, summarized the problems of enterprise adoption of Blockchain with an imperative question, “Where to start?”

He highlighted that it is easy to orchestrate machines to agree on protocols but is quite the opposite in case of people when it comes to Blockchain. According to him, the main hurdle lies in understanding the core concepts of Blockchain and propagation of knowledge. There is difficulty in circling down to one use case of Blockchain that a consortium of enterprise users can fathom and start engaging in.

Enterprises need to comply with the regulations laid out by their local jurisdictions in terms of Data Protection, Regulation, and Governance which may prevent them from taking complete advantage of Blockchain adoptions. Blockchain by definition is a shared database on which enterprises try to communicate with peers on the events that have occurred internally and what inferences these peer entities or collaborators should derive from them. Tricky questions like which data to share? Does the enterprise have control over the data once shared? Which parties have the ability to take a look into the issues and concerns since collaborators are also competitors? Top the list when it comes to enterprise collaboration on a Blockchain. Contextual access control that an enterprise can put over this data is another aspect that needs enterprises to pay heed on. Blockchain is a process and the control aspects are something one cannot design in the protocol and has to be developed on top of the protocol. The non-existence of readymade tools that can be installed easily like MySQL. A lot of planning has to be done to ensure that processes run smoothly.

Blockchain is an append-only and read-only database that currently does not have the flexibility to support deleting attributes or implementing protection mechanisms over them.

Specific purpose protocols like Bitcoin which are currency-specific in Blockchain and other platforms like Ethereum that provides general purpose solutions have different procedures that are followed and do not guarantee consistent performance for Blockchain as a whole unit.

Blockchain implementation does not have generic structure options like database schemas or XML templates that can be modified based on needs.

Cryptographic management of keys between organizations is another area where data confidentiality and integrity need to be carefully managed between enterprise Blockchain networks. Usually, credentials management or encryption are carried out by protocols like HTTPS or security layers like SSL online by browsers, servers, or applications without human intervention. But, in the case of Blockchain, these aspects have to be managed by people which will be a tedious undertaking.

Trade-offs between Blockchain properties like speed when laid focus on, leads to a compromise in other factors like governance. The five interdependent trade-offs in Blockchain are speed, openness, transaction costs, decentralized trust, and censorship resistance, where, every other aspect gets affected if one of them is compromised.

Next challenge lies in the robustness, reliability, and Smart Contracts vulnerabilities. The errors in Solidity language and Ethereum, and proof of stake consideration flaws prove that the promises made by frameworks in the past have not been met during time-critical implementations. The major issue lies in the confidentiality or privacy of data, contracts, and applications that are put on shared platforms which may be vulnerable to data leaks in enterprises through participants who do not have a stake on the workflow. Blockchain poses a problem when it comes to role-specific privatization of data.

Backward secrecy of data strategies through access control mechanisms are difficult to devise when new participants join the shared ledger platform, where they cannot read transactions that have taken place before them joining the network.

Standards pertaining to routers, firewalls, software, and any other hardware come with definitive standards. Complying with them by Blockchain is something that is difficult to promise for enterprises at the moment.

Finally, platform interoperability through consensus among machines and humans on standards, protocols, workflows, etc. is a challenge that still haunts the enterprise adoption of Blockchain.

The challenges faced by Blockchain Solution providers can be summarized in the following points.

  • Arbitrary Pricing
  • Protocol, Cloud, and Vendor Lock-in
  • No True Decentralization
  • Incompatible Blockchain Ecosystems
  • Interoperability issues
  • Complications in building applications
  • The assumption by clients that Smart Contract Technology is a solved problem
  • Customers mixing up foundation-level protocols with a complete business solution

Conclusive Reprise

On a higher level, the challenges in the enterprise adoption of Blockchain can be divided into organizational, economic, and technological challenges which have been delineated above.

conclusive reprise

With these current impediments standing in the way of enterprise adoption of Blockchain, the three panelists exclaimed that only time will tell how predictable, secure, and useful Blockchain will be for enterprises in different business domains, but were positive about enterprise adoption happening sooner than later.

 

5 Ways in which Blockchain will Disrupt the Gaming Industry?

The extremely competitive gaming industry is under a constant state of stress. This could be attributed to the constantly evolving technology landscape, intense competition, changing consumer habits and lack of regulation, which paves way for an unstructured industry where competitive edge becomes difficult to sustain. While the industry has been strongly impacted by technologies (AR, VR and AI) offering immersive experiences, the need for a revolutionary technology that can address the loopholes while transform it into an economic endeavor rather than being just an entertainment activity is strongly felt.

Today, with around 70 % of American population playing video games, the gaming industry has witnessed growth in leaps and bounds. According to statistics shared by Newzoo consultancy, the current global gaming market which stands at $108 billion is forecasted to reach $138 billion by 2020.

However, irrespective of the size and growth, businesses have to deal with obstacles, and the gaming industry isn’t any exception. Blockchain – a peer-to-peer technology has the potential to transform the gaming industry in multitude of ways. Here’s how:

Blockchain in Gaming

    • Providing Players with a More Personalized Gaming Experience: Gaming companies often store their assets on centralized servers fearing risk of asset duplication. Since, they do not have control over their purchased virtual assets, they are restricted from buying, selling or trading these assets beyond the gaming ecosystem. Blockchain brings the ownership and control of these assets in the hands of gamers or players by creating a transparent and decentralized ecosystem wherein players will be able to exchange their virtual assets with other players that too instantly. Apart from this, gamers will be able to exchange assets with players of other game, which will offer a more personalized gaming experience to the players.
    • Enhanced Security of Gaming Assets: Introducing Blockchain technology to the gaming industry will not just prevent illegal trading of virtual assets but will also check issues related to hacking and stealing. This becomes possible because the encrypted blockchain ledgers are impenetrable. The immutable nature of Blockchain makes duplication of assets impossible thereby proving ownership of assets and ensuring safety of gaming assets.
    • Prevents Fraudulence: Though, the gaming industry has been thriving, it has been prone to fraudulence with one out of every 7 virtual items surrendering to fraud. This has led to loss of millions of dollars in terms of revenue. Incorporating Blockchain within the gaming industry will ensure eradication of such menaces thus saving the gaming industry with billions of dollars.

Also Read: How Blockchain Addresses Issues Surrounding Data Ownership and Privacy?

  • Faster Processing of Payments: Introducing Blockchain within the gaming ecosystem will ensure faster and secure processing of payments for gamers who can now purchase items and make payments without any hassles or risk. Apart from this, Blockchain will ease the job for developers who otherwise have to struggle selling their apps beyond the app store and have to pay high commission fees to intermediaries. Blockchain allows the processing of even the smallest of amount so that developers get instantly paid and can re-invest their money in marketing their game launch.
  • Democratizing Voting Mechanism: Voting features are extremely popular within the gaming community as it helps in ranking of games, players and other items. Blockchain can eliminate the menace pertaining to corruption and manipulation of votes, which results in feedback (from the voting system) that is unreliable. The immutability element and smart contract functionality of Blockchain makes manipulation of votes extremely difficult.

Final Words:

It wouldn’t be a tall claim to make that Blockchain is poised to be the future of a flourishing and secure gaming industry. While the aforementioned benefits are just the tip of the iceberg when it comes to several benefits that this innovative technology is expected to offer, the technology will certainly bring forth new set of gaming innovation, which in turn will pave way for a new gaming landscape.

How Blockchain has Turned out to be a Game Changer in Supply Chain Management?

Every time you eat something or pick up your phone to call up someone or buy clothes from a shop, have you ever wondered as to where these products come from? Are you aware that every finished good or product that is ready for use has to travel a long journey right from the point of its’ origin till it reaches the customers? In other words, a chain of several interlinked elements also known as the ‘supply chain’ plays a significant role in delivering these products.

However, increased globalization has led to a more complex supply chain ecosystem, which has made it all the more difficult to manage it. While the management of supply chain has become an industry in itself with the industry witnessing a phenomenal double-digit growth year on year, there are several issues that continue to plague the industry.

Research report shared by Gartner reveal that the Supply Chain Management (SCM) market is expected to exceed $19 billion by 2021.

Listed below are few of the several challenges that has largely impacted the management of supply chains:

    • Archaic Technology Infrastructure: The existing technology infrastructure used for managing the supply chain fails to fulfill the growing complexities and interconnectedness of the current supply chain ecosystem.
    • Lack of Transparency: Fragmentation of data in silos within a supply chain ecosystem results in information asymmetry. This makes it all the more difficult to ensure the integrity of products moving across the supply chain leading to issues such as counterfeiting, contamination and more.
    • Increasing Customer Demand: Customers today are more conscious about the quality and integrity of the product they are using. This has built additional pressure on the stakeholders who are now looking for robust solution that can do away with all the pain point of the supply chain ecosystem.

How Can Blockchain Streamline Supply Chain Management?

Since, Supply chain management includes planning, as well as the implementation of complex processes, it is important to ensure its proper implementation, which may lead to benefits such as increased sales and revenue, reduced frauds, and better product quality. While this might appear to be simple, maintaining a supply chain in reality is an extremely tedious task due to lack of proper connectivity amongst the different elements of supply chain.

Blockchain-A distributed ledger technology has turned out to be a game changer for managing the supply chain ecosystem. In fact, several leading players are leveraging the potential of this technology by implementing it in their business supply chain.

Sweetgreen, a salad chain, based out in the US has leveraged blockchain technology for managing their supply chain. According to company’s CEO Jonathan Neman, implementing Blockchain technology allows every participant of the chain to have access regarding the provenance, as well as the status of food item during its journey across the supply chain.

Following are the ways in which blockchain can be useful in the supply chain industry-
Blockchain for the Supply Chain Industry

  • Tracking Provenance: Multiple components and elements make a supply chain extremely complex. Consequently, it becomes very difficult to keep track of each and every record. This lack of transparency impacts the financial, as well the business reputation of the organization. With an iOT powered blockchain system in place, record keeping, and tracking provenance becomes easy since data regarding the product can be retrieved through the help of embedded iOT sensors and RFID tags. With such accurate provenance tracking, several fraudulent activities such as counterfeiting etc. can be eliminated.
  • Cost Reduction: One of the major benefits of leveraging Blockchain in supply chain management is reduction in overall cost of the items in transit. This becomes possible because Blockchain does away with the need for intermediaries/ middlemen who otherwise consume a major chunk of revenue within a traditional supply chain ecosystem. With a Blockchain based system in place, risks pertaining to fraudulence, product duplicacy etc is significantly reduced while efficiency is improved.
  • Increased Trust: The only way to streamline supply chain operations is by establishing trust amongst the participants of the supply chain. Since, records once uploaded on Blockchain is immutable, it cannot be tampered with. This helps in establishing trust amongst all the participants as Blockchain follows a consensus mechanism wherein consent from each and every participant is gathered before any sort of changes could be made.
  • Increased Data Interoperability: One of the most interesting benefits of this technology is that it allows more data interoperability. This makes it simpler for businesses to share data with (manufacturers, suppliers, and retailers) each and every supply chain actor in a transparent way. Such a transparency helps curtail delays and disputes thereby ensuring smooth transition of goods across the supply chain. Since, products can be tracked in real-time, chances of loss and fraudulence becomes rare.

Also Read: Streamlining the Cold Supply Chain with a Blockchain Powered Solution

Quick Wrap Up:

The value of integrating blockchain technology can be understood from the fact that it offers the potential to link different ledgers while upholding the integrity of data amongst multiple supply chain participants. Furthermore, the properties of immutability and transparency make Blockchain a go to solution for managing the complexities of a supply chain ecosystem while maintaining its integrity.

Looking for a Blockchain Solution for Supply Chain, Contact Sofocle technologies for Consultation or mail us at success@sofocle.com

5 Important Ways in Which Blockchain is Revolutionizing the Manufacturing Industry

One of the key drivers of the global economy is the manufacturing industry. According to the World Bank, this industry itself accounts for nearly 17 % of the global GDP. Unfortunately, the industry has always been plagued with several problems including quality control and inefficiency. Apart from this, complex and disconnected supply chain has allowed fake and counterfeit products to make their way into the market, leading to lost consumer trust and brand reputation for businesses. Also, increasing customer expectations are placing more pressure on manufacturers for delivering quality products at nominal prices.

Blockchain, a distributed database has the potential to radically transform the manufacturing industry by offering visibility across every aspect of manufacturing. Right from sourcing, procurement and dealer quality to operations such as machine-level monitoring, Blockchain can pave the way for a completely new business model. Blockchain can be leveraged by manufacturing businesses for streamlining their supply chains that make up for their business foundation. The distributed ledger architecture of this versatile technology can help businesses improve supplier order accuracy, quality of product, trace the origin and track the journey of products across the supply chain. This will help manufacturers ensure quicker turnaround time, augment product quality and sell more.

Listed below are 5 ways in which Blockchain is transforming the manufacturing sector:

Benefits of Blockchain for manufacturing industry

Improving Track and Traceability:

Tracing the actual origin of a part (used for manufacturing a product) right from the point of production through the retail is difficult and cumbersome. This is because it includes multiple processes such as creating technical documentation, acquiring industry certifications and timestamps and quality checks, which are further plagued with errors. An iOT powered Blockchain based system helps in asset provenance thereby enhancing transparency and traceability for the participants of the value chain. The data gathered from the iOT sensors, when fed into the Blockchain besides allowing for a shared view also ensures that no gaps in asset handling has occurred as movement of goods across the supply chain is immutably recorded on Blockchain.

Eliminating Intermediaries:

Unlike the existing supply chain ecosystem that is administered by a centralized authority for verification of records, Blockchain provides a decentralized platform where data could be accessed by every participant of the supply chain. Since, provenance is proved, and data gets immutably recorded as a product moves across the supply chain, intermediaries could be removed as they increase complexity, provoke delays, and increase costs.

Tokenization of Processes:

Multiple financing of invoices has become a major contributor of increased supply chain finance costs due to the risks associated and the diligence required to reduce the risk. This primarily happens due to lack of transparency amongst the participants of the supply chain including manufacturer, supplier, insurer, finance providers etc. Blockchain can be leveraged for tokenization of invoices, which not just prevents multiple financing but also ensures cost savings. This happens because each invoice that is distributed across the network is timestamped with hashes and is provided with a unique identifier.

Efficient Procurement of Products:

Inefficient procurement of products account for huge financial losses. This happens due to inefficient and complex supply chain processes that expose an organization to risks and unwanted expenses. With a Blockchain powered solution in place, manufacturing companies can streamline and automate their supply chain, which speeds up the order and processing of payment for improved cash-flow and profitability.

Improved Payment System:

Yet another issue that plagues the current business ecosystem is the lack of transparency in processing of payments. Also, the presence of multiple parties involved in verifying and sending payment results in delayed payment to manufacturers. Blockchains’ smart contract functionality automates the payment process thereby ensuring quicker and guaranteed cash flow to the manufacturing suppliers.

Find out more on  Blockchain in Manufacturing Industry

Final words:

In a nutshell, we can infer that Blockchain is poised to revolutionize the otherwise scattered, slow moving, insecure, manual and paper-based system to a digital, secure, quick and automated network that can be operated on a single platform.

Over a period of time, we can expect Blockchain for process alteration, asset sharing, supply chain tracking, warranty management and more. Eventually, the end-game will be when Blockchain itself will retreat into the fabric of the complete manufacturing process thereby creating a scenario where supply chain can aptly be called as demand chain and the manufacturing processes becomes decentralized.

How Can Blockchain Help Businesses Resolve Issues Related to Product Recalls?

Be it the outbreak of E. coli in Romaine Lettuce that was highlighted and recalled by Grocery giant Walmart or the incidence wherein defective accelerator pedals sold by Toyota resulted in several accidents or the case of tainted oral polio vaccine containing strains of type 2 polio vaccine virus, there have been countless such instances where customer safety have been compromised. So, what is it that you find common in these instances? Yes…you guessed that right. It is indeed the need to recall the contaminated, counterfeit or defective products that had made their way to the market and ultimately the customers via the supply chain.

While recalling a contaminated/ counterfeit product is a proactive step towards customer safety, it can be an extremely overwhelming situation for businesses who have to deal with huge financial, as well as reputational damage. To respond quickly to such situations or incidents, businesses require becoming recall-ready by bringing in place a technology solution that can provide businesses with the degree of traceability required to deal with such crisis situations.

Blockchain – A shared ledger technology could be the answer to issues surrounding constant recalls, counterfeit products and consumer safety. By allowing stakeholders figure out the point of failures while alerting them at the same time regarding a potential mishap, Blockchain will not just help manufacturers/growers respond faster but will also ensure consumer safety.

With a Blockchain powered solution in place, retailers can provide their customers with indubitable proof of the provenance and product authenticity at every step within the supply chain. By leveraging Blockchain’s distributed ledger, harmonized database and robust encryption abilities, along with its capability to create smart contracts, retailers can gain advantage over their counterparts to successfully collaborate and augment trust across the value chain.

How Can Blockchain Expedite the Process of Recalling?

Within a value chain, a blockchain can accelerate the recalling process by providing the granularity required to recognize the problem and contain it. This way Blockchain could help retailers save millions of dollars by recalling only the product batch that is defective or contaminated. This would help curtail lengthy law proceedings, shorten investigations and sustaining liability all through the value chain.

With an iOT powered Blockchain solution in place, retailers (especially those a part of complex supply chain) can unlock unprecedented value. Such a solution can help simplify tracking and process automation for genuineness and tracking of provenance. This reduces risk, enhances customer safety and streamlines compliances.

While the IoT sensor present in such a solution tracks various aspect such as sourced components, as well as the real-time location of device within the supply chain; blockchain acts as a verified, shared system-of-record that archives and timestamps the complete string of events for the purpose of authentication and process automation. This provides the participants of the ecosystem with the transparency and visibility to deal with the risks associated with product recalling.

Quick Wrap Up:

It goes without saying that Blockchain has the potential to offer a convincing way of fixing complex supply chain issues such as product recalling for creating huge value. With an iOT powered Blockchain solution in place, the data pertaining to status of a product during transit or shipping can be captured, which further simplifies the analysis of root cause and auditing besides resolving issues related to product recalling and claim settlement.

How Will Blockchain Transform the Consumer Electronics Industry?

The multi-billion-dollar consumer electronics (CE) industry is one of the most dynamic industries. Over the past couple of decades, it has undergone rapid changes with the market being primarily governed by the way products are being positioned, purchased and re-ordered. Furthermore, the industry is also underpinned by endless chain of innovations leading to an amazing array of products to suit every need and wallet. Apart from this, the emergence of middle-class families in developing countries and the cost-cutting strategies used by some major CE players to meet new customer demands has also contributed to the growth of the global CE industry.

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How Blockchain Addresses Issues Surrounding Data Ownership and Privacy?

Social media giant Facebook recently had to bear the brunt of regulators for mishandling user data. According to report shared by New York Times, Facebook had shared sensitive user data with more than 60 device makers, including Apple and Samsung thereby staking confidential data of millions of users. While the internet giant has blatantly refuted all the allegations levelled against it and has constantly tried to justify its stand, the fact remains that its user data has been spread or hacked way beyond boundaries that are no longer within the control of the company. This and constant drumbeat of similar other high-profile instances have pushed the tipping point when people have started believing that the internet they have been relying on is actually broken.

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Streamlining the Cold Supply Chain with a Blockchain Powered Solution

The supply chain ecosystem has become extremely complex with an ever-increasing number of players involved in developing, manufacturing, marketing, and distribution of products. One of the most indispensable links of the supply chain that concerns the transport, as well as storage of temperature-controlled logistics (food and pharmaceutical) is the cold chain. Over the years, the cold supply chain landscape has undergone major changes, with 90 % of nearly all shipments making up for controlled room temperature products (CRT). However, managing the Cold-Chain integrity for perishable food items and biopharmaceuticals such as vaccines has become challenging with half of the products being lost in transit leading to escalating costs and low accessibility.

Research report revealed by World Health Organization claim that every year, around 400,000 people across the globe die from foodborne illness, with every 1 in 10 people suffering from illnesses from food contamination. Furthermore, pharmaceutical companies are facing increased regulatory pressure to ensure the quality and potency of medicines in transit or in storage as nearly half of them either get lost or contaminated as a result of exposure to unsafe temperature ranges.

These statistics speak volumes about the grim realities of the food and pharma supply chain ecosystem. Moreover, the inefficiency of the current track and trace system has led to severe financial, as well as reputational damage for FMCG and pharma companies. Furthermore, being time and temperature sensitive safe delivery of these products become extremely crucial. This creates an urgent need to bring in place an intelligent supply chain solution that could provide better supply chain visibility by tracking the journey of a product from beginning till the end.

Blockchain – a decentralized and distributed ledger technology could help reconcile the complexities of the cold supply chain ecosystem by speeding up logistics, reducing discrepancies, increasing cost-savings, streamlining processes and increasing visibility of products while moving through the supply chain. Here’s how Blockchain brings advantages for every stakeholder in the food and pharma cold supply chain. Let’s discuss each one of them individually:

For the Food Cold Chain, Blockchain brings the following benefits:

Improved Traceability and Visibility:

Since, tokenization of assets using Blockchain enables traceability of products in the supply chain, it can be used to immediately identify the point where food has been tampered with so that contaminated food is removed before it reaches to the store shelves. This alleviates the need for expensive batch recalls while curbing the instances of illnesses and deaths caused as a result of contaminated food.

Preventing Fraudulence:

The complex food supply chain with multiple actors is vulnerable to errors that are usually motivated by fraudulent intentions. Being a decentralized platform, Blockchain can bring an end to these activities by tracking and recording any action done in bad faith by individual participants. Since, data or transaction once uploaded on Blockchain is immutable, immediate and necessary action can be undertaken.

Also Read: Addressing the Pain Points of Food Industry by Implementing Blockchain in the Food Supply Chain

Increased Brand Loyalty and Customer Safety:

Since, Blockchain offers supply chain transparency, consumers can be assured of the safety of food they are consuming. This happens because Blockchain has the potential to offer customers with information regarding the journey of product (food) right from farm till fork. For instance, customers can retrieve full history of a food item by scanning the smartcode printed on a food package.

Quicker Payment:

Since, Blockchain does away with the need for intermediaries, cost savings increases. Furthermore, due to automated functionality offered by smart contracts over Blockchain, ready availability of validated data is possible, which in turn ensures quicker and proper payments to stakeholders involved in the food supply chain.

The Pharmaceutical Cold Chain, Blockchain brings the following benefits:

Blockchain Cold Supply Chain - Pharma

Improved Traceability of Drugs:

Since, the pharmaceutical industry is a highly regulated industry, Blockchain helps achieve compliance by offering serialization authentication along with tracking capabilities. Besides preventing counterfeiting and tampering of drugs, Blockchain ensures continual flow of vital drugs to ensure that patients receive proper and timely treatment.

Improved Inventory Management:

Blockchain provides an efficient way of filling up the gaps created by legacy systems that were used for inventory management. By anticipating stock shortages, improving data integrity and distribution, this technology can help businesses manage and control their inventory efficiently.

Supply Chain Integrity:

The smart contract functionality of Blockchain could be leveraged for streamlining supply chain processes thereby ensuring supply chain integrity. Since, Smart contracts defines terms and condition of an agreement, it can help mitigate fraud while lower costs by eliminating intermediaries involved in payment and other transactions.

Read More: How is BlockChain Contributing to the Efficient Management of Pharma Supply Chain?

The Way Ahead:

Blockchain is poised to transform the cold supply chain ecosystem. When applied to the cold chain, blockchain can securely document the storage temperatures of a product throughout its journey in a supply chain. This helps stakeholders anticipate and identify potential sources of contamination thereby helping them avoid costly recalls while ensuring customer safety.