For many, the word blockchain conjures up images of cryptocurrency and the dark web. These are things that don't play well within an enterprise.
More recently, however, we’re hearing respected voices praise blockchain technology. In particular, some highlight the enterprise use case for blockchain:
"We're really excited about the opportunity for blockchain within the CRM space. And I know a lot of you are coming here are saying "This is going to be interesting, how is Salesforce going to be using blockchain? We see a lot of opportunities in smart contacts and with loyalty and then extending out of CRM into supply chain management, product traceability, tremendous amount of interest, trading platforms. We are really excited."
-- Bruce Richardson, Chief Enterprise Strategist, Market Strategy, Salesforce -- Fast & Secure Blockchain Integration With Salesforce CPQ: Dreamforce 2018
Here we provide some insight on the perception of blockchain and take a look at new and potential cases for using blockchain technology in a variety of enterprise endeavors.
Identifying the disconnect
At the highest level, a blockchain is just a database. Its distinguishing characteristics are the immutability of its transactions and decentralized control; decentralized control is its principal feature. With traditional databases, one organization controls the master data. However, with blockchain, or distributed ledger, participating organizations have equal ability to read and write master data.
Blockchain technology was popularized in 2009 by the advent of the cryptocurrency Bitcoin and later in 2014 by the more generalized open-source Ethereum. At the time, both technologies relied on a large public anonymous network for their security and use financial instruments to encourage participation. These factors attracted bad actors who caused some high-profile incidents, which contributed to the negative perception of blockchain technology.
In the last several years, however, newer enterprise-focused blockchain technologies were created that run on private authorized networks: principally open-source Hyperledger Fabric and Ethereum (with proof of authority consensus). This change freed the technology from the complexity required to secure a large public anonymous network and yet retains the core benefit of enabling a trusted distributed ledger. Enterprise blockchains are being piloted for a variety of use cases, including financial transactions, supply chains, and logistics.
Financial transactions, for example, traditionally require people to reconcile ledgers in each transacting organization. This is why we see a delay between depositing a check and when the funds become available for use.
Within a blockchain, or distributed ledger, each organization has immediate visibility into immutable transactions. In theory, within a financial network built upon blockchain, such funds could be instantly available. This shift from people to algorithms should also allow for very small high-frequency transactions to be made across regions.
Another use case is in the shipment of medicine across a global supply chain. Every year, $200 billion in revenue is lost due to tampering and counterfeiting of medicines. Billions more is lost due to broken cold chains leading to discarded biologics like vaccines.
To begin to address these issues, one could create a distributed ledger accessible by all the supply chain participants, from drug creator, warehouser, distributor, and finally to the administrator. In particular, Wipro has partnered with Microsoft to create such a solution called Titan-Secure.
By using a distributed ledger, all organizations participating in this global supply chain can have real-time visibility and trust in the storage conditions of the medicine. The increased confidence enables improved efficiency in identifying damaged or tampered goods. This particular use of blockchain technologies is often referred to as a cold-chain.
We are also beginning to see integration solutions between popular enterprise software and private authorized blockchain networks. One such example is the blockchain integration with Salesforce CPQ, which enables disparate Salesforce organizations to build cross-organizational workflows.
These use cases show that blockchains are being used to speed up transactions, reduce waste, increase revenue, and preserve brand reputation. Bottom line: If you’re faced with automating cross-organizational workflows, take some time to explore how blockchain, aka distributed ledger, technologies can fit.
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