Supply Chains and Blockchain: Real World Examples

12/03/19

Is your company using Blockchain technology? Could your supply chain benefit from it?

At APICS Greater Detroit we are passionate about serving our local supply chain community. We do this by supporting professionals with the information and education needed to stay competitive in today’s ever changing world.

Read more below to learn about what Blockchain is and how it’s being leveraged today in supply chains across industries including food, automotive and pharmaceutical.

What is blockchain? Per SupplyChainDigitial, blockchain is, “a system that records change and movement of transactions. It’s maintained across several systems that are linked to a peer-to-peer network. When it comes to the supply chain, blockchain acts as an immutable ledger within a decentralised location. Meaning that any changes in ownership or possession of goods, along with their movements from each end of the supply chain, can be recorded instantly for the greatest possible accuracy, which is essential for businesses. This increased transparency across the chain can allow for a clear understanding of the value of goods, as well as a more succinct idea of a fair and reasonable cost of each individual product. It also allows for more detailed traceability in goods from across the globe, which gives an insight into the environmental impact of products, as purchasers can follow the entire journey of their orders.”

IBM provides more useful information on their website on the types and uses of blockchain. Next we’ll look at some real world examples.

The food industry has been an early adopter of blockchain in part because of consumer’s wanting transparency. Per CoinTelegraph, the Food Marketing Institute (FMI), published a study in 2018 that found as much as 75% of consumers are more likely to switch to a brand that provides more in-depth product information — beyond what’s provided on the physical label.

FoodOnline shared recently how the National Fisheries Institute (NFI) worked with IBM’s Food Trust to launch a seafood blockchain pilot this past summer, beginning a comprehensive seafood supply chain traceability pilot program. The work is the first multi company and seafood species effort. NFI members who represent harvesters, importers, processors, cold storage, foodservice restaurants and retail are all involved in the program. Per NFI President John Connelly. “NFI members’ supply chains are dynamic and wide reaching, a fertile ground for this type of pilot.”

Several large players in the automotive industry, including Ford and GM have teamed up with The Mobility Open Blockchain Initiative (MOBI) to develop a multi-stakeholder Proof of Concept (PoC) for a blockchain-based Vehicle Identity (VID).

In September, MOBI members launched an important joint initiative to test implementation of the first VID standard, released earlier this year, taking a critical step towards the new economy of movement with blockchain. MOB CEO Chris Ballinger shared, “Creating a trusted digital identity for a vehicle unlocks the potential for a mobility payments network, including: V2V/V2X transactions, electric vehicle to grid integration, usage-based services, fleet operations, congestion pricing, carbon footprint management, and more.”

Ford Motor Company also shared in October a new pilot to investigate how innovative geofencing and blockchain technology could help to accurately track and increase the number of “green miles” driven by vehicles.

According to a recent Forbes article, the value of blockchain technology in the health care market is expected to surpass $1.6 billion by 2025 (paywall). A blockchain example today in the pharmaceutical industry is MediLedger. They are utilizing blockchain to provide a secure platform that offers its users the option of smart contracts and traces certain prescription drugs from the manufacturer to the patient’s doorstep. By utilizing a blockchain network, each step on the process is able to be stored and time-stamped.

These are just a few examples of where blockchain is disrupting industries today and being leveraged to better track information throughout supply chains.