The challenges faced by a Supply chain and how a Blockchain can help solve them.

The challenges faced by a Supply chain and how a Blockchain can help solve them.

Any supply chain faces many challenges, from logistical issues to simple issues such as not having access to enough information and not knowing what to do. For instance, you may know that a particular warehouse needs refrigerators, but someone forgot to communicate how many or at what time. This is a simple issue; you can call them up and clarify what they precisely need. But through blockchain integration, you enable instantaneous information transposition. You do not need them to tell you that they need these refrigerators since through blockchain and other applications built upon its predictive technologies, you can quickly meet their demands.

Block creates a network that is tamper proof and creates legitimacy of your process. Legitimacy is the hardest commodity to acquire as any business. When using a blockchain solution you can use more data collection points to optimize supply chain solutions further. Blockchain allows all participants to verify the position of the transaction instantly in an anonymous fashion. Any participant in the blockchain chain will view this data immediately without looking at private data another party does not want them to see. All parties will share only pertinent information about the item in question; this enables companies to work closer together without intertwining their businesses and creating issues as to who the leader is.

Further, security benefits of using blockchain in your supply chain is that the blockchain is decentralized so you even if one of the data centers from any part of the supply chain are lost the data is not lost because it there are multiple copies of it kept constantly throughout the chain. The normal problem of spreading multiple copies of your data and as a result making it easy to access are then combated by the requirement of a key to access the blockchain at any point.

Blockchain creates a set of data that no one can erase because of the blockchains decentralized nature. As a result, we can analyze previous data with great accuracy. All data history is kept, and if any discrepancies are found in the movement process for your goods, you can look at where something went wrong. For instance, you are shipping 50 TVs between 2 warehouses, and only 47 arrive at the second warehouse can now use your blockchain to analyze where something went wrong. The blockchain would track how many items left the warehouse, the number of items the driver accepted, and how many arrived at the second warehouse. You can now see where the goods went missing and start an investigation. You can do all of this from the comfort of your computer by looking at the blockchain instead of having to go to each person and collect data from them. This process helps identify problems such as this and helps reduce them as the security itself is a deterrent.

Further you integrate every part of the supply chain into your ledger. Horizontal integration is the next step in optimizing supply chains, as you can keep up all parties involved in a procedure to date. Traditionally, we only see vertical integration where the party sending an item and the party receiving know the shipment process. Now the bank the manufacturer has taken a loan from, the warehouse it's going to, the shipment company, and the shop/person the good is being delivered to know where the good is whenever they want. This is made more efficient with blockchain because anyone with permission can access this data very securely, instantly, and accurately.

Security and integrations are not the only benefits of using a blockchain as there are also environmental benefits. The ability to track your carbon footprint is going from a niche product to something that every company will require to function in the future and meet the standards set by governing bodies. Blockchain also creates a solution here; instead of leaving a physical paper trail that everyone involved would have to trace and find, there is a digital trail left that anyone with permission can access in a secure and fast manner. The immediate access to this kind of data allows companies like SmartOpt to create algorithms that track each material point the data was inputted and understand how much your transportation has had on the climate.

The challenges in calculating your carbon footprint lie in that you do not have up to date information at all points of contact and that this data is usually in a paper format. When faced with these limitations, it takes a massive amount of time to generate a report on your emissions which will most likely be out of date by the time you finish. With the creation of a blockchain network, you can track all contact points in an organized, digitized way. Instead of an insecure paper trail or insecure digital network, you have a chain that builds as time goes on that is only accessible by pertinent people. Each step is encoded into the blockchain, helping us understand when and where the blockchain collected each data point. When we know the location of the encoding in the next step of the blockchain, we can then calculate how much fuel it took for a person to get to that location and understand the impact of the process on the environment.

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