You hear it everywhere you go – blockchain. The word is omnipresent; you hear it on the internet, in corners of parties, you overhear it at coffee shops - so much so that you now have a layman’s understanding, but you’re not quite sure exactly what it is: it has something to do with Bitcoin. Sounds familiar? We’ve been there. But blockchain is a fairly simple concept – you just have to become more familiar with it.
Let’s help with that shall we?
Simply put, blockchain is a shared, permanent ledger, that is to say a record that enables the recording of transactions and tracks assets in a business network. Now an asset can be tangible (a house, car, cash, land etc.) or intangible (intellectual property, patents, copyrights, branding). Basically, if it has value it can be tracked and traded on a blockchain network.
But why is everyone so excited about it? Why is everyone trying to be a blockchain expert? The answer is simple: blockchain is one of most powerful business tools to be invented. Here’s why – business, especially contemporary ones – operate on information and thrive on real-time, relative information. Relevant up-to-date information keep companies ahead of their competitors and quickly serve and even predict customer wants and needs. The faster it’s received and the more accurate it is, the better. How the blockchain network works is by delivering that information immediately; shared and completely transparent information stored on an incontrovertible ledger that can be accessed only by network members with the correct permissions, no participant can change or tamper with a transaction after it has been recorded in this shared ledger.
A blockchain network can track accounts, orders, payments, production – pretty much all the information a business needs to be competitive and efficient. And because permissioned network members share a single view of this information, they can view all details of a transaction from start to end. It’s scary how efficient this network can be.
Now that we have covered what it does, let’s take a look at how it works.
When a transaction occurs, it is recorded as a “block” of data, these blocks of data record and display the movement of tangible (product) or intangible (intellectual) asset. The data block can record the information of your choice: who, what, when, where, how much and even the condition of your asset— such as the temperature of a food shipment.
Each of the data blocks is connected to the ones before and after it, forming a chain of data as an asset moves from place to place or changes hands – that is where the name blockchain comes from. The blocks record the exact time and order of transactions and then link securely together to prevent any one block from being altered or another block being inserted between two existing blocks.
This makes the blockchain tamper–proof as it will record any action taken on it, removing the possibility of tampering and building a register of transactions you can trust.
A good example of the efficiency and reliability of blockchain is when it is used in the global seafood industry, through the power of blockchain businesses in this industry ranging from trawler companies to high-end restaurants can track the movement of the product, and ensure its freshness from catch to plate – potentially saving themselves millions of dollars in operational costs and you from a bad tummy ache. Blockchain serves everyone.
Another way Blockchain is transforming your world is by its application in healthcare enterprises, increasing quality of care by enabling new systems and business models to evolve. Healthcare information can be stored on a blockchain - changing the way clinical information is stored and shared within the organization, healthcare partners – and most importantly – with patients. Faster, more accurate diagnoses and prescriptions can save lives and reduce mistakes which lead to happier patients and healthcare workers.
When the global pandemic hit, retailers faced challenges they’ve never faced before, challenges such as keeping products on shelves, keeping supply chains moving, stores open and employees safe. These challenges can now be faced with more efficiency and decisiveness as the world steps in to the ‘new normal’, retail sales are increasing again – and with blockchain to help bolster efficiency through real-time information sharing, retail and all its processes can now change for the better – ready to face any new challenges that come along. As in the case of The Home Depot using IBM’s blockchain technology to gain real-time, shared, and trusted information of their goods throughout the sourcing, shipping and receiving process. This efficient use of blockchain has resulted in The Home Depot being able to greatly reduce the number of vendor disputes and vastly accelerate dispute resolution leading to a more streamlined process and, incidentally, more profits.
There are several blockchain network builds to choose from. They can be a public, a private, a permissioned or a group. A public blockchain is one that anyone can join and be a part of, such as any cryptocurrency (Bitcoin, Dogecoin etc.).
A private blockchain network is a distributed peer-to-peer network where one organization governs the network, controlling who is allowed to participate.
A permissioned blockchain is a private blockchain network usually set up by businesses who will place restrictions on who is allowed to participate in the network and in what transactions. Participants need an invitation or permission to join. It is important to note that public blockchain networks can also be permissioned.
A consortium, or group, built blockchain is built by multiple businesses, these pre-selected organizations determine who may submit transactions or access the data.
That is what blockchain is, in a slightly larger than average nutshell. I hope this write-up shed some light on this elusive subject and you are more confident of adopting this revolutionary system for your very own business.
Thinking of adopting blockchain technology to your business? Click here to schedule a meeting with our technology consultants and we will be happy to help you incorporate your business with blockchain technology as well.