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World Economic Forum promotes blockchain technology
World Economic Forum promotes blockchain technology
Blockchain

World Economic Forum promotes blockchain technology

By Marco Cavicchioli - 7 Apr 2020

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In a recent article published on the official website of the World Economic Forum, blockchain technology is explicitly suggested as a solution to guarantee the confidentiality of suppliers’ data concerning the supply chain.

The article, written by SKUChain co-founder and vice president Rebecca Liao and the head of Digital Trade at World Economic Forum LLC, Ziyang Fan, focuses on possible solutions to make supply chains more resilient.

These solutions include the use of distributed ledger technology, and the blockchain itself, as part of an ongoing process of digitizing supply chains to make them more resilient to future shocks.

The article is based on the premise that the ongoing emergency due to the COVID-19 coronavirus pandemic has further highlighted the importance of obtaining clear and certified information about the entire production and distribution chain. 

In particular, the problem is that often nowadays companies which sell end products only know the production and distribution processes of their direct suppliers, completely ignoring those of their suppliers’ suppliers. 

The COVID-19 emergency has led to interruptions in the distribution of various pre-processed components or raw materials, which in turn have led to production suspensions. 

Replacing these unavailable parts from other suppliers is not as simple as it might seem at first glance. 

Often, information about products and their distribution is still in paper format, and this emergency has shown that operations dependent on physical resources, such as paper, can be severely disrupted when, for example, the physical presence of operators is not possible. 

At this point, the digitization of the supply chain becomes necessary and inevitable, to the extent that governments and companies with a strong digital infrastructure and enabling standards are already addressing the crisis much better than others.

However, an open question remains: how can suppliers be guaranteed that data relating to their products, their production and distribution processes, and the companies themselves, can be protected enough for them to accept these solutions? 

Today, this data is often sent in plain text, which is in fact visible to everyone, and this is a strong entry barrier to the digitization of the supply chain. 

The solution proposed by the article is the use of public or private permissioned blockchains. In reality, the definition of a permissioned distributed ledger as a blockchain is not really correct, so although the World Economic Forum article uses this term, it would be better to call it a distributed ledger, or DLT

That said, a DLT could allow providers to have control over all data sharing permissions directly on their node, so that that data can then be securely distributed to others in the same network without requiring complex centralized system integrations. 

Initiatives like this, however, require a lot of time to be developed, tested and launched, so the article asks for funding programs in this regard, in order to be prepared to use these technologies in response to future disruptions.

 

Marco Cavicchioli
Marco Cavicchioli

Class 1975, Marco teaches web-technologies and is an online writer specializing in cryptocurrencies. He founded ilBitcoin.news, and his YouTube channel has more than 11 thousand subscribers.

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