At the end of my Keynote Speeches, I always have a row of CTOs and Innovation Directors asking me where to start a Blockchain Roadmap in their companies. They feel Decentralisation will radically change the market they operate in, but they feel lost with all the buzz around ICOs and Cryptocurrencies. They don’t know where to start, and their job is to figure it out.
“Success is where preparation and opportunity meet.” — Bobby Unser
Throughout 2018, I’ve been fortunate enough to work on countless Blockchain use cases across several industries, company sizes and geos. We started the year with a big focus on ICOs, cryptocurrencies were at all time high prices, the noise was overwhelming and the use cases were mostly futuristic and farfetched to say the least. Nowadays, ICOs have cooled off quite a bit, and Enterprises are taking Blockchain more seriously. As we all embrace this shift in the Blockchain space, the use cases are maturing and now Enterprise stakeholders find them much more realistic and doable. At TechHQ, these are some broad examples of use cases that we have developed with global Enterprises.
#1 Asset Registry
This is a classic case for Blockchain. Assets could be Houses, Cars, Parts, Diamonds, Trucks, Containers, Projects, Documents, Payments, Data Points and so on. The granularity changes depending on the context, but the architecture is mostly the same. In most industries, there are centralised registration authorities in each jurisdiction for major taxable assets, such as Houses or Cars. Centralisation has done a good enough job so far, since people tend to trust those organisations. However, if companies want to innovate this process, for example by collecting more data points or by making data available to third parties, then there is a significant heavy lifting to be done by evangelising such Central Authorities to change the way they have worked for so long. Trust issues arise as well when data needs to be made available to third parties and new levels of transparency are needed.
The same goes for more granular assets, such as Files, Images and broadly defined Data Points. In most cases, these are property of one company which controls their collection and distribution. Most companies that reach out to us want to create new business models around data they own, but most of their clients and competitors aren’t necessarily interested, given they don’t trust the data owner in the first place. Decentralised Registry of such assets makes all these new data ecosystems Transparent, Accountable and Secure, and that’s why companies are leveraging them to create new business models.
#2 Supply Chain Consortiums
One natural extension of Tracking Assets in a Decentralised Registry is across a Supply Chain. There have been very tangible inefficiencies over time due to centralisation of data in Supply Chains. The trust issues are obvious, Sellers don’t trust Buyers and Buyers don’t trust Sellers. Heavy business agreements are signed and a myriad of middlemen are in play, such as auditors, certifies or validators. Some relevant data points are never exchanged at all across such chains, since buyers tend to have the upper hand in negotiations and direct contact with consumers, but sellers have the pre-transaction data which can be relevant for buyers.
Decentralised Supply Chain models are emerging. Typically within a Consortium of companies involved in a certain Asset’s lifecycle, such as a Retailer plus it’s suppliers, or such as an OEM plus several Tiers of Part Manufacturers plus Logistics. The rationale is usually the same: reducing the dependency and costs with middlemen, making transactions more efficient, and creating a level of Transparency and Accountability that enables new business models based on data exchanges across the supply chain.
#3 Industry-wide Consortium
Another high stakes case where centralisation has been very limiting since the beginning of time are relationships between competitors. Competitors don’t trust each others for a myriad of reasons, they have high incentives to keep their data and processes secret, and industry-wide synergies have always been very challenging to get right. The potential is huge, though. Competitors typically have similar challenges, processes and cost structures. There could be huge gains for all of them, if only they could collaborate efficiently.
This is a very interesting case for Consortium Blockchain Protocols. Bringing competitors together in a way that is Transparent and Accountable creates high incentives to act in the benefit of the industry, and better Security lowers the barriers to entry. Although challenging to do right, most major industries have focus groups that are now creating new industry-wide standards based on Blockchain and Decentralised Consortium Protocols. This will seriously increase efficiency and transparency while enabling new business models.
Ten years ago, online marketplaces were vastly enabled by the then emerging gig economy. There are natural trust issues between Buyers and Sellers, between Service Providers and Service Users, and between any two parties that want to transact but don’t even know each other. These trust issues were mitigated by the Central Entities that emerged as the trusted middleman that both parties trusted. New business models were created that no one would have imagined before. Think Airbnb, Uber, Upwork, etc etc.
These Middlemen have taken a fat slice of the transactional value for themselves, though. Because they created a monopolistic position for themselves, but also because having all processes centralised implies having high operating costs. Decentralised control systems and processes are coming to make most of these processes more efficient, cheap and transparent. New decentralised incumbents are emerging in all major online marketplace segments, and whole new categories are being enabled entirely by decentralisation.
Blockchain, DLTs and whatever other terminology that refers to Decentralised Software Architectures are coming to change business processes and value chains across industries. I can tell you there will be three buckets of companies that will come out of this disruptive wave:
- Companies that are Blockchain-native and thrive by creating whole new value propositions that capture large market shares.
- Companies that manage to evolve their existing processes into Blockchain, and sustain or improve their existing market positions.
- Companies that fail to adapt to Blockchain and risk their existing market positions.
As the CTO, Innovation Director or equivalent stakeholder in your company, you are in a unique position to champion Blockchain discovery, exploration and adoption within your organisation. The best time to start could have been two years ago, but the second best time to start is now. The space is still unstable, but maturing very rapidly. There is still time to create a concise Blockchain roadmap and start taking key steps towards the goals identified in it.
At TechHQ, we are helping key stakeholders in companies of all sizes championing this transformation. With our Consult > Innovate > Build approach we are bringing the right pace of Blockchain discovery and adoption across industries and geos.
This article was originally published here.