90% of the world’s goods are shipped by sea in roughly 60,000 cargo vessels. The largest cargo vessels carry 24,000 containers. And at that scale, it’s not hard to imagine why everything from the chair you’re sitting in to the microchip in the device you are reading this on can be lost or delayed anywhere (and everywhere) in its lifecycle before reaching you.
From hurricanes and tankers running aground to poor business networking and inconsistent partner promises, there have been problems with supply chains long before the COVID-19 pandemic. That’s why, over the past few decades, businesses have made IT investments in ERP systems, EDI exchanges, and standards such as ISO 9001. These investments and innovations have helped make global supply chains more efficient. But as both business and consumers can attest, there is plenty more work to do.
Supply chain agility relies on multi-party data sharing networks
Today, up to 80% of critical business data now lives outside a company’s four walls. Its suppliers, manufacturing sites, distributors, and wholesaler dealers are all trying to coordinate their transactions using different systems that don’t communicate well with each other.
This situation creates a host of problems because every one of these businesses requires critical, accurate, and timely data about the goods they’re transacting. Plus, every party needs information on any incidents that could have serious implications for their supply chains, customers, and individual brand reputations. With the increased complexity of the global supply chain and deep dependencies among suppliers and manufacturers, companies are experiencing new backlogs and information breakdowns on a regular basis. Empty store shelves, “sold out” ecommerce labels, decreased brand loyalty, and lower profits are among the costly results.
How blockchain benefits global supply chain partnerships
Today’s multi-level supply chains demand technology solutions that provide all parties with improved visibility into where, when, and how items are flowing. They also require visibility into how the end-to-end mechanics of the supply chain fit together. Without this visibility, companies will not be able to understand actual and potential disruptions as well as opportunities to prevent or mitigate interruptions.
Blockchains that combine blockchain and cloud technology are one solution with multiple benefits.
Benefit #1 – Decentralize multi-party data sharing
Businesses can use blockchain technology to track cargo, much like Amazon consumers track orders, shipments, and deliveries in real time.
Think of a gourmet chocolate retailer. They need to know important details about their products like whether the cacao beans were ethically sourced and sustainably farmed, if it was exposed to temperatures above its melting point during transit, and when new inventory will arrive. This end-to-end view of a chocolate bar can be established and maintained over time, but only by bringing together disparate data from many different parties — cacao bean farmers; product transporters and warehouses; manufacturing, logistics, and retailers — together as a single source of truth.
Benefit # 2 – SaaS-based tech that easily connects the entire data ecosystem
Next generation blockchains are often delivered in a software-as-a-service (SaaS) form, eliminating the need to manually deploy, secure, maintain and pay for infrastructure scaled to peak capacity as a prerequisite. By its nature, SaaS connects all parties in a value chain to ensure 100% authenticity and integrity. SaaS also ensures that all partners (and every permissioned user within each party in the ecosystem) have the same reliable, complete view from raw material provenance and quality through to finished product retail delivery.
Benefit #3 – Focused on privacy, security and compliance
Next-generation blockchains and distributed ledgers offer out-of-the-box solutions for data privacy, making it easy for data producers to decide who can view or update their data using simple permission mechanisms. With so many parties involved and so much data about the supply chain being produced and consumed in real time, it’s critical that businesses have the ability to enforce and audit who is able to access their mission-critical business data. When competition or anti-trust regulations apply, these problems take on even more urgency.
Benefit #4 – Energy-conscious and cost-effective
With the increasing role of blockchains as mechanisms to share both code and data across companies and clouds, understanding and identifying which blockchain technologies can help improve carbon footprint (rather than worsen it, another shortcoming in first-generation blockchain) is an important question.
Companies that deliberately focus on improving data strategies and compute will positively impact costs and power consumption. Because next-gen blockchains are energy- and cost-conscious, avoiding the ecological impact of proof-of-work systems and benefiting from multi-tenanted cloud architectures, they pass these cost (and carbon footprint) benefits on to adopters.
Transform your supply chain with Vendia Share
Give your company the power to accelerate and automate its data workflows across global supply chain partners with a single source of real-time truth.
Ask our experts about a 5-day proof of concept or request a demo showing Vendia Share in action.