Blockchain, as the household name representing many emerging distributed ledger technologies, is best known with applications in the financial services sector, and given the current media storm one would be forgiven for thinking it is synonymous with crypto-currencies. But it’s become apparent that there are a wider set of use cases far beyond monetary exchanges. In fact, blockchain enables a wide variety of business applications and it promises to completely transform value chains.
It offers businesses a powerful new tool for interacting with value chain partners and unleashing the full benefits of technologies such as IoT and artificial intelligence. The time has come for industrial enterprises to take a good hard look at blockchain and see how it can drive new levels of efficiency in their business operations.
Exchange value and securely share data
To function effectively, businesses must regularly share information with numerous value chain partners – suppliers, logistic providers, certification providers, service providers and buyers. Traditionally, these exchanges are time-consuming and error-prone which has slowed down business processes and trapped value.
Blockchain offers a new, more reliable method of sharing up-to-date, trusted information with value chain partners without compromising enterprise speed and security. It does so by the nature of being a distributed, decentralized digital network for sharing data with confidence. Every partner has controlled access to an encrypted copy of the same data. It contributes to an interconnected ecosystem where everyone is on the same page.
We’ve identified three key ways in which blockchain can transform business processes and unlock value formerly trapped in the value chain:
- Blockchain reinvents processes: By breaking down data siloes and duplicative processes, blockchain will allow businesses to overhaul the capabilities that support how they interact with and act on shared data.
- Blockchain improves productivity and quality: By working from a mutualized data source via blockchain, businesses can trust the data—thereby eliminating one-off data updates, exceptions, and reconciliations.
- Blockchain increases transparency: Connecting data across the value chain, blockchain will provide transparency and real-time sharing across all parties; boosting trust and minimizing risk.
Blockchain in action
But how do these capabilities translate to real use cases? One of the most compelling lies in adding transparency to end-to-end supply chains. For example, a blockchain service history for a piece of manufacturing equipment would allow all parties – the company, machine manufacturer and the servicing company – to aggregate comprehensive records of what work was performed, who did the work, and when throughout the lifetime of that equipment. When you have a holistic view on the maintenance history of all your assets you can quickly identify crucial gaps in need of service that may not be apparent on the surface.
Another key use case lies in corporate finances. Many accounting processes are still too time-consuming and inefficient. Take the example of invoice disputes, which often requires multiple communications between companies as they check and re-check their records for discrepancies. With blockchain, all parties could work from a common record with smart-contract-based enforcement. This prevents many discrepancies from ever taking root in the system.
The transformational impact of blockchain
By replacing the processes that communicate and duplicate data with a new common view of the world, and by building new levels of trust and transparency, blockchain eliminates the extra effort ingrained in dealings with multiple businesses.
But this is just the beginning. Businesses can unlock even more value by combining blockchain with analytics, machine learning, and cognitive capabilities. This combination paired with deep industry and domain expertise creates unprecedented opportunities for reducing inter-business entanglements, while assisting human workers with complex decision making and creative problem solving.
The future belongs to organizations that embrace blockchain
Blockchain is very much real, its potential benefits are substantial, and its widespread use is not a matter of ‘if’ but ‘when’. It’s a general purpose technology, and though it may take time for blockchain to reach mass adoption across business processes, the companies that start now will be the rule makers.
Companies should begin mobilizing now to determine how to use this transformative technology to free value trapped in key operational processes. It should be an important part of every company’s agenda, regardless of its industry or where it sits in the value chain. industry or where it sits in
For more information on Blockchain’s transformative power for business operations, download a new Accenture point of view on the topic.
As the Technology Innovation Senior Principal within Accenture Operations Growth and Strategy, Melanie Cutlan leads the Blockchain Practice for Accenture Operations. She explores emerging technologies, applies them to the business and advises Accenture’s senior leaders on future implications due to blockchain technology. She helps clients use design thinking to lay out the art of the possible, and then works with technical experts to chart a plan to take real and impactful steps towards a reimagined future. Prior to leading the Blockchain Practice, she led the Tech Studio where Lean Startup Methods where used to disrupt the business from the inside out. She is experienced in Strategy, Innovation, Blockchain Applications, Account Management, Delivery Leadership, large scale technology upgrades, transformation, service readiness, outsourcing, and industrialization initiatives.