Over the past forty plus years I have seen people try to take a technology and force it on a business problem. Trust me on this one, if you want to waste money and time, go ahead; however the odds of you solving the business problem are somewhere between slim and none. The case of using blockchain to solve supply chain problems is just not there. The only thing blockchain and supply chain have in common is the word chain.
My professional world is technology and ensuring the security of information systems. Because of this I’m constantly reading and listening to see what is happening in my world and applying that knowledge to help my customers solve their problems. One publication I go to is the World Economic Forum for a broad picture of what’s happening. Most of the time I find their writing good, but this time they seem to have had some marketing intern write about how blockchain will solve the supply chain problem. Actually, what I see here is trying to get an emotional response (it’s hacking the human brain, that’s a subject for another day) to get buy in on a solution in search of a problem.
What is blockchain? Pretty simple, it’s a data structure that is designed that once data is put on the blockchain, it is difficult to change. Notice I said the word difficult and not impossible because you can change data in a blockchain. In Blockchain a primer, I said that a blockchain is immutable; that statement is incorrect and I need to go back and correct it and perhaps rewrite. Once hailed as unhackable, blockchains are now getting hacked. Some blockchains support “smart contracts” and some people say this is a feature. I say it’s a security bug; but I digress. This is not about smart contracts that have proven to be buggy. See the above link from MIT Technology Review.
So, what is blockchain good for? Recording transactions that you don’t want changed. Financial transactions, yea’ we’re doing it. I have also proposed using it in Criminal Justice Information Systems to record everything from the assignment of Judges to logging of evidence and Government Purchasing Systems to record Request For Proposals, Bids, and Awards. In short, blockchain is a good tool if you absolutely do not want the data to be changed. If you need something to fix the supply chain, first define what problem you are trying to solve. Again, forcing a specific technology on a business problem is ass backwards. First, define the problem, then look at the available solutions and select the one that fists best.
Now, if you see how blockchain will solve supply chain problems, I’m all ears and will be happy to listen to you. Until someone comes forward and offers specifics; I’m skeptical.
——-UPDATE 15 May 2020 ——–
I had a chat with a friend on this issue, he gave me one use case where blockchain can be used to track the supply chain. It involves high value goods or combating counterfeit goods. This is because there is a tipping point where the cost of putting something on the blockchain. Say we have coffee beans, are you going to scan each coffee bean? How about one kilo of coffee beans? Now 100,000 kilos of coffee beans? When do you start putting things on the blockchain? How about office chairs as this article mentioned? Does blockchain solve this problem, or do you use a well designed RDBMS system complete with a well built audit trail? By the way, Oracle 20c has native blockchain tables if you really want to go this route.