Blockchain is driving tremendous changes within our economy and our society. This is quite impressive considering that almost no one understands how it truly functions. And yet, even though the technical aspects of this technology are still not comprehensive to the majority, its practical aspects are discussed by almost all industries. Everyone wants to be profit from this new technology and wants to use it to its advantage. An area, in particular, would benefit greatly from investing in this new innovation: supply chain management.
The importance of transparency in business operations is continuously highlighted as a key element for success. According to a study from Label Insight, 94% of the participants indicated that transparency is a fundamental aspect of their loyalty, and 73% of the participants stated that they would agree to pay more for a product that offers complete transparency. Therefore, companies must guarantee total transparency of their operations to maintain competitive advantages and to avoid losing costumers. And this is where the use of blockchain becomes interesting.
The reason for this statement is that in recent years customers have witnessed countless examples of abuses from companies. Those examples range from multinationals who are accused of using slaves in their supply chain to pick up coffee, to fishing companies who use illegal and unethical methods to capture and process fishes. The issue here is that most of those companies have extremely competent marketing or public resources departments, who are talented in minimizing any unethical behaviors. This aspect makes it complicated for customers to know what he or she is consuming. Currently, there is no centralized auditing which could help highlight those kinds of behaviors and thus assure customers on the quality of the products they are buying. Blockchain, as a decentralized system, could provide a part of the solution.
With the use of blockchain, consumers have the possibility to evaluate each product, before the purchase, using a QR code. The QR code can provide all the information on the goods from the harvesting of the ingredients or fabrics to its delivery to the customers. The case of the Blockchain Tuna Project from WWF is an interesting example of such an application. As soon as the fish has been fished, a tag is inserted to register it on the database. Whenever the fish passes by a new point of the value chain, the tag is scanned to indicate that it was indeed processed at this step. Due to the decentralized nature of blockchain, consumers will have the guarantee that the information they access was not modified and will thus be able to see who was involved at each step of the supply chain process. This technic should help limit slavery and child-labor practices.
Example of such applications can be found in the following examples: WWF and the Blockchain Tuna Project, Diamond from De Beers, Fashion from Martine Jarlgaard, Wine from TagItSmart, and many others
References:
https://www2.deloitte.com/us/en/pages/operations/articles/blockchain-supply-chain-innovation.html
https://www.entrepreneur.com/article/295739
https://www.wwf.org.nz/what_we_do/marine/blockchain_tuna_project/
Melville, J. (2020) From Bean to Brew: The Hidden Cost of Coffee Slavery, BylineTimes
Blockchain In the Supply Chain: 10 Real-Life Use Cases and Examples
