Whether it is supply chain management, human resources, or any other sector, blockchain can impact a diverse range of industries. However, its adoption rate in industries is slower than expected. One of the many reasons is the myths revolving around its distributed technology and how that works. It threatens and prevents businesses from capitalizing on its far-reaching capabilities. So, let’s debunk a few misconceptions around blockchain first, and then find out the reasons signaling why you need it for your business.
There’s no denying that blockchain has found its primary use cases in managing financial transactions. However, now blockchain solutions are being used to expedite settlement processes, enhance cross-border payments, and make end-to-end, traceable supply chain processes. Whether it is about goods shipment or verification of credentials, a blockchain solution can significantly enhance the security and transparency of transactions. Additionally, employers can use it to verify a job applicant’s credentials and ensure that the applicant has the skills he/she claims to have.
It is true that mining via public blockchains can drive up costs. But, it is not true with permissioned blockchain solutions. Permissioned or private blockchain networks don’t require crypto mining. Indeed, a group of trusted participants defines the rules of information validation across the network. As a result, it proves to be quite cost-effective and beneficial.
Apart from operating as the underlying infrastructure for cryptocurrencies like ETH, and XLM, blockchain has many other applications across diverse enterprise operations, like insurance, healthcare, identity verification, and supply chain management. If you’re a business reluctant to adopt blockchain because of these misconceptions, consider connecting with our team for more clarity.
So, now that we have debunked the myths around blockchain, let us find out why you need blockchain for your business.
Blockchain has moved beyond its applications in cryptocurrencies a long ago. Now, almost any industry involving data management, intermediaries, transactions, and more, can explore blockchain. In the following section, get answers to questions like why you need blockchain solutions for your business.
If your business is dependent on legacy supply chain processes, whether it is pharmaceuticals, food, healthcare, or manufacturing, blockchain can play a significant role.
Existing supply chains are not traceable or transparent enough to satisfy consumer demands in these industries. It requires to have a traceability system that can detect anomalies and inefficiencies caused by fraudulent activities. For instance, introducing blockchain in the food supply chain can improve the traceability of food products from the farm to the table. Similarly, blockchain in healthcare can enable pharma companies as well as consumers to track the entire journey of medicines. It is because once stored on the blockchain, data becomes immutable. Further, it enables all stakeholders to have equal and easy access to information related to provenance and state of products.
Blockchain enhances fragmented supply chains by securing processes and transactions right from manufacturing and transportation to end-consumers. It does it in a way that makes every participant accountable for their responsibilities (as per the agreement) throughout the supply chain.
Stakeholders within a supply chain can onboard suppliers globally, as well as manage long-term relationships through an industry-wide platform. It is possible with blockchain smart contracts used to store and manage data related to supplier onboarding. It provides stakeholders with advantages like onboarding simplification, secure access to information, and enhanced reporting capabilities.
Almost every industry faces challenges occurring from increased pressure from regulators and governing bodies. Blockchain, with its permissioned shared ledger technology, provides regulators the traceability required to obtain higher levels of assurance concerning products’ entire supply chain.
Presently, transactions related to contract execution like asset ownership and transfer occurring through business networks are slow, inefficient, costly, and vulnerable to manipulation. Every participant in the business network uses their ledger to maintain business records. It gives rise to discrepancies and duplication in transactions, resulting in disagreements, disputes, increased settlement times, and dependency on intermediaries with associated overheads. The use of a blockchain-powered ledger across the business network can help it to reduce overheads while lowering risks.
Blockchain provides a consolidated, consistent dataset with reduced errors, and near-real-time reference data using consensus mechanisms. Also, no single participant owns the ledger or the source of origin for the information stored on it. It leads to enhanced trust and integrity in the flow of transaction information among participants. Furthermore, attributes like immutability and transparency lead to cost-effective auditing and regulatory compliance practices. So, executing business contracts like ownership transfer or making payments with blockchain make them smart, automated, and final. It benefits businesses with increased speed of transactions, lowered costs, and timely settlements of contracts.
There are more reasons for a business to invest in blockchain solutions and introduce the technology within their ecosystems. To name a few, it can strengthen the security of data storage and exchange, enhance identity management, establish trust and transparency among consumers, and more.
Apart from businesses involving complex supply chain and slow contract execution, others can also explore blockchain development services. They can avail the services to boost business productivity and performance by investing in the right blockchain use case.