{"id":4781,"date":"2022-03-06T18:00:00","date_gmt":"2022-03-07T00:00:00","guid":{"rendered":"https:\/\/www.mhisolutionsmag.com\/?p=4781"},"modified":"2022-03-22T09:59:14","modified_gmt":"2022-03-22T14:59:14","slug":"blockchain-technology-adds-transparency-traceability-and-security","status":"publish","type":"post","link":"https:\/\/www.mhisolutionsmag.com\/index.php\/2022\/03\/06\/blockchain-technology-adds-transparency-traceability-and-security\/","title":{"rendered":"Blockchain Technology Adds Transparency, Traceability and Security"},"content":{"rendered":"
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Feature<\/div>\n
Supply chain benefits include real-time data and ability to react to changes quickly.<\/div>\n
BY SHERYL S. JACKSON<\/span><\/div>\n
\"blockchain
ISTOCK.COM\/MATEJMO<\/a><\/span><\/figcaption><\/figure>\n

A<\/strong><\/span>lthough most often associated with financial transactions, blockchain and other distributed ledger technologies also offer capabilities to support business operations\u2014including the complex data sharing requirements of the supply chain. According to one analysis, banking may lead blockchain adoption, but it is closely followed by telecommunications, media and entertainment, manufacturing, health care and life sciences, retail and consumer goods and government.1<\/a><\/sup><\/p>\n

“Some people assume that money is always involved with blockchain functions, but some of the first commercial use cases of the technology were related to certification of supply chain transportation,” said Scott Buchholz, emerging tech research director and CTO of government and public services at Deloitte Consulting. “The supply chain has typically relied on inefficient methods of sharing data such as email or batch data processing, which do not provide real-time changes in information, but technology can address some of the supply chain\u2019s challenges.” Blockchain technology allows organizations to securely share and update information in real time across organizational boundaries to eliminate cumbersome record-keeping activities and improve accuracy, he explained. Incorporation of blockchain or other ledger technologies into systems and platforms used throughout the supply chain enables all stakeholders to view and update accurate, timely information, he said.<\/p>\n

“Blockchain alone won\u2019t solve the supply chain\u2019s challenges, but blockchain along with a symphony of other systems and platforms will allow transparency so the origin of goods and materials, the impact on people and places, and the financial transactions associated with supply chain activities will be connected and visible to everyone,” said Leanne Kemp, founder and CEO of Everledger.<\/p>\n

One of Kemp\u2019s clients, a New Zealand diamond retailer, relies on a blockchain-based platform to record the myriad of exchanges from the mine to the retailer, to collect data and document the origin of the diamond. The company\u2019s move to the platform addresses the concerns of the new generation of engagement ring customers who consider sustainability and ethical sourcing when purchasing a diamond.<\/p>\n

“In the diamond industry, it is important that the origin of every diamond be verified at every step of the supply chain,” Kemp pointed out. “The use of a combination of paper documents, emails and digital communication throughout the supply chain is not a reliable way to transfer information.”<\/p>\n

Advances in the technology along with standardization are driving a greater adoption of blockchain technology. Technology companies are integrating the technology into solutions offered to a variety of industries, including financial, health care, agriculture and consumer goods, said Buchholz. The transparency and traceability throughout the entire supply chain support actions like smarter recalls, especially for grocers or other retailers, he said. “Car manufacturers could not only conduct smarter recalls based on the origin of components, but they could also be nimbler to react to component and materials shortages and stockouts.”<\/p>\n

Because today\u2019s supply chain is global, customs agencies have explored how to improve the accuracy of manufacturing goods data provided by companies importing and exporting materials. The purpose of streamlining this process and improving transparency is to facilitate trade.2<\/a><\/sup><\/p>\n

Challenges at the customs agencies include a cumbersome and complex process for both the agency and manufacturing companies. The error-prone system that includes onsite visits and manual review of reports may mean that agencies miss duty fees they are entitled to collect. The concerns of manufacturers include hours spent creating reports and preparing for audits, as well as protection of data related to their intellectual property.3<\/a><\/sup><\/p>\n

The General Department of Vietnam Customs (GDVC) implemented a confidential data reporting solution that incorporated blockchain technology to automate the reporting process, improve the transparency, auditability, security and accuracy of the data, enhance fraud-detection capabilities and improve the ability to collect all tariff revenues. Manufacturers benefited by reducing time spent preparing reports and improved accuracy of information, which potentially saved significant dollars in unnecessary duty or non-compliance fees.<\/p>\n