Blockchain: Vital Link in the Supply ChainBy Jorge Ramos Zwanziger | Thu, 07/29/2021 - 12:22
Blockchain solutions can help companies optimize their supply chains and improve productivity and profitability, according to the National Council for Logistics and Supply Chain Executives (ConaLog).
Better connectivity has given rise to Logistics 4.0, which involves the digitalization of all logistic processes to streamline operations and improve customer satisfaction. Logistic operations can be improved through the use of blockchain technologies, explains ConaLog.
Blockchain is increasingly being used by large companies to optimize their logistic processes. “There are several cases that show blockchain is successful, not only for the people proposing this innovation but for those adopting it. Companies like IBM, Walmart, and SAP have developed production solutions. Walmart, for example, requires all its suppliers to use blockchain technologies,” said Karl McDermott, Global Head of Business Development of Morpheus.Network to MBN.
What is Blockchain?
Blockchain is a decentralized public ledger system that documents all changes to a record in real-time, explains BuiltIn. It supports today’s logistics industry by creating a shielded, transparent and traceable system that allows all players in the supply chain to have real-time access to data, documents, customs payments, merchandise conditions, and container weight, among other parameters, in a digitalized and automated manner, erasing the chance of human error, explains CargoFive.
According to CargoFive, the technology establishes a number of links that are necessary to get a container from origin to destination. The number of links cannot be altered and in order for one link to perform correctly, the previous one must do so as well. One key advantage to these systems is that they reduce bottlenecks and clerical errors, as information is automated and decisions can be made with fully symmetric information. If something in the supply chain is not running smoothly, it is easy to identify why. According to BuiltIn, coupled with emerging technologies like big data and AI, blockchain could increase the global GDP by 5 percent. This technology is part of the evolution process towards the complete digitization and automation of the supply chain.