The benefits of blockchain technology for supply chains
As a result of disruptions in the supply chain, utilizing advanced technology to optimize operations and management is becoming increasingly vital. While organizations continue to implement these new structures, embracing blockchain technology will be a key factor in fostering supply chain success.
Essentially, a blockchain is a digital ledger of transactions that is easily duplicated and distributed across a network of computer systems. In terms of supply chain management, this improves the ability to track assets from production to delivery or use. As more and more businesses continue to utilize these upgraded systems, it will become a necessity to keep pace with demand and competitors. In fact, a report from Fortunly found that 74% of tech-savvy executive teams believe there's huge business potential in blockchain technology.
The benefits of a blockchain for supply chain management include:
One of the main advantages of blockchain technology is the security standards it sets in place, and while issues in the supply chain continue, it's important to put protecting your data at the forefront of your priorities. Blockchains are incredibly difficult to falsify, actively reducing the possibility of fraudulent activity or forgery. It's an effective measure for keeping data secure throughout the entire global supply chain.
Improved traceability and transparency
The digital ledger of a blockchain provides a clear oversight of the supply chain processes as they occur. This traceable digital record greatly improves management, while simultaneously introducing enhanced transparency with smart contract technology. A higher level of visibility is essential to eliminate errors and prevent costly mistakes. As businesses begin to reduce these issues, they improve their ability to optimize processes and foster growth.
Automation is a growing necessity within supply chain management and blockchain technology actively utilizes these systems. A blockchain can be implemented to automatically log activities throughout the supply chain, which significantly reduces the likelihood of human error. Not only does this boost efficiency throughout the process, but the mitigation of common errors improve delivery speeds as well. This is a successful way to enhance the customer experience — which leads to increased customer retention rates.
Improved coordination between partners
A supply chain network often involves a complex collaboration between multiple partners. By improving data transparency and supplying a centralized platform for data, blockchain technology helps mitigate collaborative issues throughout operations. Moreover, the reduction in miscommunication and errors results in more efficient and effective partnerships across the global supply chain.
When it comes to supply chain management, the advantages of this technology are clear to a majority of organizations — as worldwide spending on blockchain solutions is expected to reach $11.7 billion in 2022, according to a report from Techjury. Issues in the supply chain are expected to continue for the foreseeable future, so maintaining efficiency and optimizing operations is more important than ever. Blockchain technology is a compelling option to consider for streamlining your processes, ensuring they're secure and staying on top of management along the way.