Opportunities for New Efficiencies and Revenue Models in Enterprise Blockchain
Blockchain, or distributed ledger technology (DLT) is estimated to create $3.1 trillion of business value by 2030 (Gartner). Enterprise blockchain technology is well on its way into the mainstream to change how database structures are thought of and used. As adoption ramps up, CIOs and IT departments should be thinking about the various use cases and best practices for evaluating, testing and deploying solutions.
The implementation of immutable, secure and automated transactions on the blockchain can streamline workflows for financial services, cybersecurity, IP licensing, manufacturing and any process that requires trust-based transacting of finances, agreements or information between multiple parties. Trust and transparency are arguably the most significant benefits enabled by blockchain, but greater efficiency, automation at scale, market differentiation and monetary benefits can also be achieved. The potential use cases are endless. Some of the most promising we’re seeing today include:
Food Distribution: Several retailers and food producers are launching blockchain initiatives to improve food source transparency and make it easier to pinpoint sources of contamination worldwide. In this use case, digital product information (i.e. farm details, expiration dates, shipping information and more) can be assigned to each unit of food, then tracked and permanently recorded on the blockchain through every step of the distribution process, bringing a new level of trust and security.
Medical Insurance: Traditionally, medical records are maintained in disparate systems that act as silos, making them difficult to track. Further, the insurance process is fraught with red tape, causing extensive delays between when a claim is submitted, coverage is confirmed and payment is made. But a blockchain solution, whereby the medical ecosystem has access to patient data, is able to transact with that data in a transparent way and uses smart contracts to realign incentives, can speed up process and reward patients and physicians for participation in activities that improve health and preventative care.
Supply Chains: Dozens of industries – including cosmetics, oil and gas, pharma and cannabis – grapple with supply chain and regulatory challenges that could be alleviated through enterprise blockchain systems. When a digital identifier is assigned to a chemical shipment, cannabis crop or batch of vaccines, those items can be tracked indefinitely every step through the supply and distribution ecosystem. The insights provided by that tracking can be leveraged to inform critical business decisions. In this use case, blockchain can streamline cumbersome supply chain challenges, simplify record keeping and provide new or improved revenue streams.
IoT Device Tracking: Connected equipment, vehicles and other enterprise machines are part of the industrial world today, but enterprises are still trying to figure out how to fully manage and leverage this connectivity. Blockchain provides a digital tracking system where data from IoT devices can be recorded and used in smart contracts and transactions. For example, DLT can be used to ingest data from wearable devices and health-related smartphone apps, where it can inform primary care providers and transact in a tokenized economy for healthcare spending.
Since blockchain technology may be impactful in many areas of a business, CIOs may want to work with experts to help prioritize the best and highest-use scenarios that will meet business goals. It’s important to start with a well-defined proof of concept to enable the business to build and test workflows against expected results, including financial results. Outside expertscan share known lessons learned and insights gained from industry activity. They can also help compare current workflows to proposed blockchain workflows, so teams can evaluate their full range of options. Finally, they can help with software selection and customization to best achieve the desired outcomes.
During these early years of adoption, as CIOs and IT decision makers pursue blockchain, it is important that projects be flexible, transparent and driven by cross-department collaboration. A holistic and well-planned approach will ensure the project does not fall short like many well-intentioned technology implementations do.