Print.IT - issue 49

28 PRINT.IT 01732 759725 BUSINESS PROCESSES ...continued Unpermissioned blockchains avoid censorship, where someone in authority decides which transactions to accept. Permissioned blockchains typically have one or more owners and the consensus process can (optionally) be carried out by a smaller set of trusted agents – like Governments or banks. Only authorised parties can validate transactions, and access to transactions can be restricted to certain participants. Permissioned blockchains are very amenable to businesses because the consensus process is much faster and it’s easier to control who has access to sensitive data. How ready are businesses for blockchain? Businesses today are becoming more interdependent – not just for mission-critical tasks, but also for services or products that carry legal liability, for example food providers that need proof their suppliers are correctly processing ingredients. The maintenance and repair of critical machinery, like airplanes and surgical equipment, requires staff with provable certifications. Home mortgages are touched by a large number of entities that, to this day, do much of the work on paper forms. When a problem occurs, for example an E. coli outbreak or a jet engine malfunction, it can take weeks for all parties to sort through their records to determine the root cause. Using a blockchain ledger provides a single, shared place where all constituents in a business chain record their actions. The record can be constantly checked by computers looking for problems – like a wrong part mistakenly installed during maintenance. For manufacturers and distributors that ship across borders, simply delivering goods can generate dozens or hundreds of paper documents describing critical aspects of the process, like routes taken, customs declarations, insurance riders, hazardous material documentation, sourcing documents and certifications for carriers of special cargo. Digitising and electronically transmitting these documents is a commonplace practice. Critical shortcomings still remain, mainly stemming from Government demands for transparency and disclosure, along with greater complexity in business itself. Today, each company participating in a global logistics process is likely to keep its own collection of documents and records relating to a given shipment. If any piece of documentation is amended or revoked by another party (or Government), it’s possible some participants won’t be notified and might wind up retaining outdated or even conflicting information. Some companies mitigate this problem by using a collaboration tool like Microsoft SharePoint as a centralised document repository. But access to that repository is often managed by one controlling entity who might not always protect everyone else’s interests. Centralised repositories are also expensive to maintain, subject to outages and cumbersome to audit. Blockchain is a great advancement for an industry like global shipping because a reliable, shared ledger simplifies recordkeeping. For example, a manufacturer can write the bill of lading – a document issued by a carrier detailing a shipment of merchandise and giving title of that shipment to a specified party – and contract terms to their copy of the blockchain. Those entries are automatically replicated to copies of the blockchain held by the freight and insurance carriers. The insurance company will write their certification of coverage back to the blockchain, which triggers the carrier to schedule pickup and delivery. The carrier will copy the proof of delivery to the blockchain, indicating to both the manufacturer and the insurance company that the customer has taken final possession. A blockchain for overseeing a shipping operation improves efficiency for all parties involved. Because each party has a copy of the blockchain that they can access locally, no one has to log in to anyone else’s system to enter data. Better yet, no one relies on emails to keep paperwork in order. When an event occurs, all parties are notified automatically. If a problem arises, everyone can review the same history, which helps avoid liability issues. The security of a properly administered blockchain helps prevent entries created by unauthorised users or even authorised users from secretly altering data or repudiating a transaction. Is your business blockchain-ready? Despite being in the news for several years as the technology driving Bitcoin, blockchain for commercial use is still very new. Much of the commercial uptake is still in the proof of concept (or startup) stage. There are four key areas to consider when deciding if your business is ready for blockchain: 1 Are the standards good enough for your industry? Blockchain works as an application programming interface (API), which means standards need to be developed before there is widespread adoption. There are multiple groups working on these, including Hyperledger and the Etherium Alliance Framework. Gartner expects the industry to stabilise in 2018 with 75 commercial blockchain platforms before consolidating to about five platforms in 2019 (source: The Evolving Landscape of Blockchain Technology Platforms ). 2 Is the technology robust enough yet? While blockchain is conceptually simple, the underlying technology encompasses some difficult technology challenges. This is especially true for the distributed capabilities of blockchain, which allow each party to have their own writeable copy of the same historical Blockchain is a great advancement for an industry like global shipping because a reliable, shared ledger simplifies recordkeeping