11 Apr On the verge of transformation
On the verge of transformation
Guest post written by Michiel Steeman, Professor of Supply Chain Finance at the Windesheim University of Applied Sciences
Are people aware of the transformation that is happening right before their eyes? Were people aware that the Ford Model T would forever change the way we move ourselves and our goods? Or that an information management system proposal in 1989 would turn out to be a tiny innovation called the World Wide Web? And now my question is whether we should we be aware of Blockchain?
It is true: Blockchain is complex. Its understanding requires probably a technical specialisation and, very likely, some focused training. On the other hand, however, businesses do not need to walk the technical maze of the Blockchain to understand its potential implications for their supply chain. Case in point – many among them have already started working towards introducing the blockchain into their value propositions.
Look: we are not talking about distant, nebulous future. We are talking about practical applications.
Let’s see some examples: in March 2017 Maersk, the world’s largest shipping company, successfully completed a blockchain pilot in collaboration with IBM. Once the pilot is finished, the company will focus on introducing blockchain to reduce the costs of investigation and fighting of frauds; and, potentially, to reduce the number of empty containers going around the world, in a sort of UBER-like network. Very recently, in March 2017, two Chinese companies, the online marketplace, Dianrong, and the financial services provider, FnConn, launched Chained Finance, a blockchain platform for Supply Chain Finance operations. The platform is supposed to register every transaction and payment in the supply chain, increasing the transparency of information.
It is in recognition of this transformation that Dinalog and the Supply Chain Finance Community took the lead in this topic, through the development of three pilot projects revolving around the implementation of blockchain. Not lofty concepts, but real-world, functioning, projects. The first pilot project will focus on smart contracts to finance carriers, inventory financing, and circular economy.
For the same reason, the Supply Chain Finance Community is also happy to support Holland Fintech and Dinalog within the Logistics and Fintech project. The logistics sector is worth around EUR 55 billion to the Dutch economy, and employs more than 800,000 people. Blockchain technology has the potential to improve system reliability at a lower cost, and with better security than at present, improving track-and-trace capability and facilitating customs clearance. Blockchain could achieve this by eliminating dependence on any one proprietary technology or platform.
It is difficult to say what the blockchain will mean for our businesses. It will most certainly affect finance, logistics and supply chain management, and give room to uncountable opportunities. If you feel the same excitement, come join us here, on the verge of transformation.
About the Author
Michiel Steeman is the inaugural holder of the Supply Chain Finance professorship at Windesheim University of Applied Sciences in the Netherlands. He is also the executive director of the Supply Chain Finance Community, an independent global community who promotes and accelerates the understanding, development and implementation of Supply Chain Finance, supporting research projects and endorsing several SCF initiatives and events such as the SCF Forum, the Global Student Challenge and the SCF Academy.