IBM is expanding its blockchain focus to now include supply management. The hope is that decentralized, automated systems can improve the manual and often cumbersome organization of most supply chains today.
As you already know, IBM is no stranger to blockchain technology. With the company’s ‘World Wire’ cross-payment system, the company is betting big on distributed ledger systems being a major force in the coming years. It has now also emerged that the tech giant is expanding its blockchain focus to also include supply chain management.
Industry Giants Team Up
The new network will be called ‘Trust Your Supplier’ and is a collaboration between IBM and other major players including Cisco, Lenovo, Nokia, Vodafone, Schneider Electric, and Anheuser-Busch InBev. Blockchain firm Chainyard will be providing the underlying technology as the participating suppliers contribute to uploading their data to the budding networking.
The move should come as no surprise given that blockchain technology is expected to impact supply-side management the most. Research firm Gartner Inc. estimates that, by 2023, around $2T of goods and services will be tracked on blockchain-based systems. IBM is looking to capitalize on this fast-growing industry.
Blockchain Saves Time and Money
Traditionally, managing the supply-side of a major business is where most of the costs lie. Identities need to verify and documents must be tracked, a time-consuming task which requires strict precision and is prone to human error. An immutable ledger system would allow companies to save time, money, and reduce almost all chances of fraud, according to IBM.
According to Marie Wieck, general manager for IBM blockchain, “The validation and onboarding of new suppliers is a critical pain point for virtually any company that relies on a robust supply chain to conduct business.” Weick says that, according to IBM’s estimates, 70 to 80 percent reductions can be expected in time saved as well as roughly 50 percent in administrative costs.
Even more surprisingly, IBM already has many suppliers lined up. Around 18,500 of them are under IBM’s umbrella already, with 4,000 of them being in North Amerca brought in the last few months alone.
The Trust Your Supplier blockchain is expected to launch commercially sometime in Q3 of 2019.
Do you believe that blockchain’s best use-case is as a means to track supply? Let us know what you think of IBM’s new project in the comments down below.