Globally, governments have failed to prevent the spread of COVID-19 while companies struggle to minimize the impact on their supply chains. According to a survey by Dun & Bradstreet, the pandemic has affected 94 percent of Fortune 1000 companies’ supply chains. Often struggling are companies seen as technology and supply chain behemoths. Apple is unable to obtain the next shipment of iPhones, and Tesla has temporarily shut down its factory in China.
The problem is that supply chains have become more fragmented, competitive, and lean as a result of globalization. When things are good, this works to everyone’s benefit. Still, yet, features like product tracking, transaction traceability, and end-to-end visibility remain absent. However, when things go wrong, they go badly, and the combined consequences cause uncertainty on a global scale. Pandemics push one to think creatively about how to become healthier and more resilient. Our experts at Oodles agree that the creation of blockchain-based supply chain solutions would be a game-changer at COVID-19.
While no country will be fully prepared for a pandemic of this magnitude, there are a few places where interoperable blockchain technology solutions can help.
Technology companies and startups have begun testing several technologies based on distributed ledger technology (DLT), such as blockchain. They’re working on solutions for end-to-end traceable supply chains, medical data sharing interoperability and management, and more.
Let’s take a closer look at how blockchain will help you improve the supply chain and plan for a pandemic like COVID-19.
Blockchain is the best-suited platform to help businesses leapfrog to trusted digital supply chains. In the normal shipment of one sea container, there are 28 parties involved, each with its record-keeping method.
Blockchain, which is essentially a trusted digital ledger, stores all parties’ digital transaction records. As a result, blockchain serves as the primary source of truth for all parties involved. Authorities get all of a ship’s details—the owner, cargo content, crew members, and route—even before it arrives at a port, without having to sift through tonnes of paperwork. The port authorities will then decide if the ship should be examined, quarantined, or cleared. This reduces uncertainty while also reducing the need for human interactions.
The Port of Rotterdam, one of Europe’s busiest, is developing one of those blockchain-based port logistics solutions. The whole shipping process is paperless and traceable to delivery. Both stakeholders have real-time access to shipments and orders, and financial transfers are instantaneous, reducing risks while increasing reliability and interoperability.
Due to COVID-19, most businesses will be evaluating supply chain visibility in 2020. In times like these, a company’s ability to understand the value chain can determine its sustainability. An obsolete supply chain structure may buckle under the immense pressure of these latest global developments.
Many businesses lack visibility into upstream and downstream inventory levels, making it difficult to respond to rapid changes in demand. Following past disturbances, companies made efforts to provide several suppliers to spread the harm. They didn’t have enough network visibility, however, to notice that their new tier 1-vendors were still using the same tier-2 vendors.
Supply chains based on blockchain bind all parties to the same network, untangling the complicated global system and making every step of the process transparent. Companies can see all levels of vendors and subcontractors, as well as their positions and output capacity. This enables them to identify risks, simulate scenarios, perform what-if analyses, and take preventive steps.
It also enables companies to keep track of their reactions in the face of rapidly changing circumstances. Knowing where the products are in real-time also offers companies more order management flexibility. In one hypothetical scenario, a router company orders 100,000 units, half of which are manufactured in Japan and the other half in Wuhan, China. The company can see that growth in Wuhan is slowing on the blockchain. This enables the company to take corrective action and minimize the consequences.
A farmer may apply information about grown-up crops, such as sources, forms, sowing process, storage, and other required information, using a blockchain-based mobile application or framework. Other network stakeholders will be able to look over this readily available data.
Furthermore, machine learning algorithms can help food processors such as factories make informed crop quality decisions. Furthermore, smart contract-based frameworks for regulation on the blockchain will ensure compliance as data is being fed into the blockchain database. The crops can then be obtained by food processing companies or refineries for further processing.
After obtaining the crops after bidding for them via smart contracts, food processing units begin processing and storing the information relevant to the public blockchain.
Through accessing the information stored on the blockchain, retailers or customers can check whether or not the food has been properly processed. Smart contracts with additional regulations ensure food safety at any stage of the manufacturing process.
Following the processing of food products, food refining or processing companies may put the processed items up for sale. Then, using the smart contracts, wholesalers and retailers will bid on prepared food products.
Furthermore, manufacturing firms ship raw food to wholesalers, with real-time updates to transportation information on the blockchain.
Wholesalers may also provide logistic services to deliver goods to various retailers. IoT-enabled vehicles or trucks can transport processed food while keeping it healthy and at a controlled temperature.
IoT-enabled vehicles can send real-time data to the blockchain network about the temperature and location of food products. It will help retailers keep track of the food they’re about to get.
At this point, the blockchain food supply chain solutions would have information from source to destination, including crop origination, manufacturing, transportation, storage temperature, expiration, and other data, all of which will be permanent and easily available.
Eventually, a customer would be able to verify the authenticity of a particular food item by examining every detail. Government auditors may also inspect the cost and quality of food products from farm to table using records held on blockchain-based food supply chain solutions.
Every network stakeholder agrees to verify every piece of data collected during each transaction. As a result, the entire transaction chain becomes an irreversible and permanent record.
Indeed, the importance of supply chain management with blockchain in-depth after COVID-19. Connect with our blockchain experts for a detailed discussion and start innovating.