“How do we create value? You create value by running services on blockchain”
While Amazon and Walmart are setting new highs in the logistics sphere, the newest tech fad is giving small retailers a night mare. Even as experts and influencers debate over the viability of immediate incorporation and ROI that blockchain technology could possibly have, all logistic players including DHL and Fedex have hopped on to this experimental bandwagon. Interestingly the fad is nearly not as ephemeral as it is touted to be. On the contrary, blockchain seems to be very promising, breaking down the hierarchical chains in an organisation, bringing more transparency to the supply chain process. As a causal effect, there is expected to be huge save of both time and money.
Commenting on the potential advantages of a centralised data distribution system, Adriana from Accenture’s Freight and Logistics industry practice says “This gives companies a significant opportunity to save time and money, whilst improving their service to customers”.
Exploring the areas that blockchain would revolutionise, here are the most significant ones:
Upping the automation game
Logistics industry has been dabbling with automation and real time order delivery updates for a long time. But if blockchain experts are to be believed, they have been merely scratching the surface. Application of blockchain to the existing logistics process will help in updating the entire system across distribution points almost simultaneously. This especially is an advantageous when a package changes hands between suppliers, distribution centres and then retailers before reaching the intended customer. This is extremely important in the context of more complex networks such as the global supply chain. Improved visibility and quicker custom compliance will increase the efficiency of the process.
Connecting the dots in supply chain
Automation is merely a byproduct of incorporating blockchain in logistics. It is not the selling point for blockchain. The real value addition lies in bringing transparency and robustness to the complex supply chain networks. This will play a key role in understanding the point of loss or drop offs and optimising the costs accordingly. In addition, it facilitates an open communication channel through all functions enabling them to handle risk proactively. It also sheds light on the disjointed areas in the network that usually results in alleviating any disruptions caused in the upstream.
Enhanced customer experience
Retailers are continuously looking at ways to redefine their customer experience to differentiate their brand and increase the stickiness factor. By taking care of tedious paper work for international shipments, zeroing in on counterfeit products, simplifying supply chain management and integrating with IOT, businesses can focus solely on improving the product. This finally relieves them from using a long trail of resources involved in ensuring successful last mile fulfilment. The only barriers of course are the ease of adaptability of blockchain technology and the willingness to invest in the technology which is still in its infancy.