Blockchain, IoT, Virtual Reality and Machine learning are a few exponential technologies that have just begun to make their way into general use in supply chain management.
For most business owners however, blockchain is one technology that is no more than a buzzword, and its applications can be obscure and difficult to understand, especially within the realm of logistics. To put it simply, blockchain…
‘is a distributed ledger which records transactions or digital interactions in a way that is designed to be transparent, efficient, and ultimately secure. It can improve the speed of transaction execution and validation across multiple parties. These include digitally validating a transaction that has occurred between two entities and rendering it irrefutable.’
Getting to grips with IoT technology within supply chain management is a much easier concept to grasp. With IoT, we are taking all the things in the world and connecting them to the internet. We are extending the power of the internet beyond computers and smartphones to a whole range of other things, processes and environments. Those “connected” things are used to gather information, send information back, or both.
Before we can begin to clearly comprehend how blockchain and IoT is being utilised within logistics, we must first understand the origins of the technology, whilst also addressing the common misconceptions that people the world over have when they hear the word ‘blockchain’.
The birth of blockchain…
With its origins in the financial industry, the term blockchain was first actualized by Nakamoto in 2008 to exchange money between peers known as Bitcoin. It utilizes blocks to store the data and implement specific cryptography strategies to keep up the privacy of the data. Its inextricable link to Bitcoin has generated a high degree of scepticism over the contribution blockchain can make to our world.
Blockchain is bitcoin, bitcoin is blockchain. while bitcoin is the first and, undeniably, most well-known implementation of blockchain technology, there many other blockchain networks. Blockchain is just one of the technologies that underlie the bitcoin protocol upon which the Bitcoin cryptocurrency is built. The bitcoin network itself consists of various solutions and cryptographic technologies. Within this, blockchain technology records peer-to-peer transactions in real-time.
The potential of blockchain technology extends far beyond its financial and cryptocurrency beginnings. As a blockchain is just a list of records, it can be used to record any type of data and can thus be applied in a variety of industries, including real estate, healthcare, government services and unsurprisingly…supply chain!
It has become evidently clear that Bitcoin and cryptocurrency are just phase one in the long arc of blockchain, and technologies like Ethereum’s programmable smart contracts and decentralised apps are the future for supply chain optimisation.
Transforming supply chains with blockchain and IoT
Now that we’ve briefly clarified the origins of blockchain, we can now more confidently begin to acknowledge how this technology can benefit supply chain professionals looking to streamline and enhance their operations.
In the last decades, the role played by supply chain management in the business world has become critical. The demands of World trade and the Digitalization of Supply Chains is evolving at an accelerated pace, and this requires organizations to become more agile and efficient to address the expectations of the market.
In order to create a transparent and efficient supply chain, Hanhaa have engaged in a strategic partnership with Morpheus.Network, a SaaS middleware platform for seamlessly integrating legacy and emerging technologies. Morpheus.Network’s platform provides modern solutions to transform supply chains:
- Automation: Workflows drive the supply chain with predetermined automated work contracts. This starts with a Purchase Order, includes IMEX, Regulatory, Shipping & Customs documents, through to an immutable Proof of Delivery.
- Integrations: Morpheus have implemented 100s of integrations such as ERPs’s like SAP, 100 Global Carriers like DHL and FEDEX, as well as specific modules such as the USA Customs Single Window, the Automated Commercial Environment (ACE) and CTPAT for security.
- Interoperability: For easy deployment, the platform runs on major commercial cloud offerings like AWS and AZURE. It is blockchain-agnostic, and is compatible with any blockchain infrastructure a company wishes to use. For example, two companies can leverage all platform benefits without the same blockchain infrastructure implemented (e.g. Ethereum and Hyperledger).
Blockchain alone does not utilize the advantages of the technology. Implementing emerging technologies with blockchain not only solves the visibility and traceability challenges in supply chain, but also facilitates connectivity and increases transparency. Blockchain systems will work solely with data automatically generated from physical IoT devices in the whole supply chain.
Together, Morpheus.Network and Hanhaa, provide supply chain managers with a complete Digital Footprint, providing shipment history and item visibility for optimizing safe and secure supply chains saving time and money. IoT provides the monitoring and tracking of assets and goods and blockchain provides an immutable record of truth for compliance events based on IoT data.
The video below is a great example of blockchain and IoT working together to successfully monitor and organise an agri food supplier from the Netherlands sending fruit and vegetable products to a UK supermarket in London:
What are the clear business benefits?
- Purchase Orders: ERP integrations such as SAP ensure that orders are captured digitally at source.
- Digitize Regulatory Compliance and Shipping Documentation: Improved control and stakeholder accountability over complete process will reduce manual errors and costly delays such as demurrage, lowering OPEX and increasing profits.
- High Precision Inventory at Scale: IoT gives you real time visibility throughout the supply chain leading to a reduction in working capital requirements.
- Immutable Proof Of Delivery: Effectively close the shipment and link core financial processes such as billing and payments, accounts receivable, payments and credit letters to convert shipments into cash.
With COVID-19 causing havoc globally, the need for an efficient and reliable supply chain has never been more pertinent. To learn more about Hanhaa’s ParceLive integration with Morpheus.Network’s blockchain platform, check out our blockchain app integration page today.
Hanhaa and Morpheus.Network, Delivering Actionable Truth at Scale.