The World Economic Forum sees blockchain-based systems as potential drivers of the next supply chain. In the wake of the Covid-19 pandemic, end chain enterprises have realized the vulnerability their businesses face in case of disruption.
This has reiterated the need to practically enforce blockchain on supply chains. By doing so, the Head of Digital Trade at the World Economic Forum believes they will enhance more visibility. Ziyan Fan and WEF’s executive VP stated in a blog post how most supply chains are grappling with basic unknowns across the chains.
Supply Chains, Transparency and Data Privacy
Such unknowns have been known as problematic and potentially business trouble areas. It is necessary that supply chains place transparency at the core of the business. However, this transparency shouldn’t come at the expense of privacy.
A blockchain-based system ideally provides relevant parties with wider access to supply chain information and the ability to purchase and convene with upstream suppliers.
In most occasions, enterprises selling finished products have a deeper understanding of the production process for Tier 1 suppliers, in addition to grasping the ins and outs of shipment. However, these enterprises fail to understand what lies further ahead on the supply chain.
Blockchain-based system will provide transparency to supply chains
Proper blockchain-based systems built on top of the supply chain would provide crucial transparency across all parties. As a result, parties across the chain would effectively strategize and take action. These understanding would as well enable them to come up with alternative routes to ease up delays and bottlenecks.
Purely and out of form, blockchain-based supply chain systems ensure that data is authentic, immutable and actionable. As much as these data underpin the entire supply chain ecosystem and the possibility of having no direct relationship among chain parties. Data drive processes and could help eliminate unknowns and frequent vulnerabilities.
Fan and Lian say the first step to integrating supply chains with blockchain-based systems is to shift from office paperwork to digitization. Start early, enhance privacy for suppliers and incentivize suppliers every time they share their data.