Blockchain is more than just Bitcoin. As an IT professional, you probably already know that. The distributed transactional technology is behind the rise of cryptocurrency, but its potential benefits to companies and individuals alike reach far beyond that.
In fact, some now speculate that over the next decade or two, blockchain technology could replace traditional companies altogether. According to this argument, the distributed nature of the software means taking out the middleman (organisations) between the everyday transactions and exchanges that make up our global economy.
Breathe easy: so far, we’re far away from that possibility. But that doesn’t mean Blockchain is all hype, or that it cannot benefit your company even today. In fact, when implemented correctly, it can significantly decrease your transaction cost, saving valuable funds and improving your entire digital infrastructure.
It makes sense to get started now. As the technology is still growing and evolving, implementation in your workplace could mean a significant competitive advantage. While Blockchain is expected to grow more than 40% every year until at least 2022, only 13% of global CIO’s have a plan for it in place.
That doesn’t have to be the case. Potential implementations are available today and might be more streamlined than you think. Consider this article a practical framework to adopt Blockchain in your workplace.
Finding a Potential Implementation in Today’s Work Environment
Make no mistake: Blockchain has the potential to be revolutionary. And yet, as of today, it’s just as effective when used as a simple method to improve your IT infrastructure. Which brings us to the first step of your Blockchain implementation framework: find out the best use case as an introduction to the technology in your business. Your options range widely.
How to Improve Financial Operations Through Blockchain
The most obvious implementation is in the financial realm. Its main purpose, after all, is to decentralize transactions, making them easier to complete and optimise. Particularly international payments can be easily streamlined and made more secure, removing the need for ledgers on both sides or losses in the currency translation.
This matters, whether you are looking to optimise your external or internal payment mechanisms. In fact, it may well be the low hanging fruit in your Blockchain implementation. Moving to a distributed payment system may not even require comprehensive implementation on your end; in fact, systems like Discover and MasterCard now offer distributed payment options.
The Trust Component of Blockchain Implementation
If financial transactions are the most obvious implementation point, trust is a close second. An increasing number of companies in trust-based industries are moving to the technology for more secure, authentic, and private communications. A recent law journal newsletter article makes a powerful argument for Blockchain as not just an option, but a necessity for law firms looking to adapt and thrive in 2018 and beyond.
The possibilities here are important to understand in taking practical steps to achieve them. For instance, the potential of smart contracts is immense. They’re applicable in law, real estate, healthcare, and other contract-based industries. Implementing them requires in-depth knowledge of Ethereum, the Blockchain technology most closely associated with this type of system.
Moving Blockchain Into Your IT Framework
In the above step, it’s important to start with a single use case. Focusing on multiple aspects at once can decrease the success chance of the implementation, and will be more difficult to sell to executive leaders who may not be familiar with the concept. Finding a single implementation point can lead to a pilot and proof of concept, which can later expand to other areas of your business.
Once you’ve found that initial pilot to focus on, it’s time to consider how you can move Blockchain methodologies into your IT framework. Here, you have two major options:
Custom-code an application for your needs.
BaaS (Blockchain as a Service)
The Complexity of Custom Blockchain Coding
The first option is naturally more complex. Custom coding requires extensive expertise in the technology, which is not yet common in the early stages of its emergence. And even then, you will still be bound by the technology you build on. The above-mentioned Ethereum, for instance, is more valuable for smart document generation but will fall behind Bitcoin and other cryptocurrencies for distributed financial transactions.
If you go the custom route, expect long deployment times, and potentially significant hurdles to overcome in the beginning. But once you have implemented a system, its benefits could be more significant than all alternatives. Now, you are able to build custom solutions specifically tailored to your operations, target segment(s), and industry niche.
The Easy Deployment of Blockchain as a Service
BaaS, on the other hand, is more standardised but allows for fast deployment. Major enterprise software packages like IBM and Azure now offer BaaS opportunities for their customers, helping businesses of all sizes employ their version of the distributed ledger and transaction capabilities.
Even when choosing BaaS, of course, your decision needs are not complete. Now, you have to figure out exactly what service you want to build on. If you are already a customer of a package offering Blockchain, that choice may be natural. But if not, it could get more complex. In that case, look exactly at what is behind the promising buzzword, and how those capabilities fit into your vision and focused use case.
Should you go BaaS or custom? As you might imagine, there is no simple answer to that question. Instead, it depends entirely on your business needs, required speed of deployment, and capabilities. Still, making this decision early in the process can help to focus your efforts and maximise your success potential.
How to Build a Better Value Chain
One use case is so significant, it deserves its own section. Regardless of your industry, chances are that you depend on efficient and comprehensive supply chain management to make sure products or services effectively get from production to customer. Any planning advantages can have wide-ranging impacts on your business.
As it turns out, when implemented correctly, Blockchain can provide that advantage. As Computer World pointed out in an article earlier this year.
A lot of companies are interested in blockchain for creating more efficient workflows, but supply chain management is one of the “big, killer apps,” according to Vipul Goyal, an associate professor in the Computer Science Department at Carnegie Mellon University (CMU).
“For example, as goods move from one place to another or one part of a company to another…, companies are interested in using blockchains to keep track of how goods are moving and where they are,” said Goyal, who is part of CMU’s Cryptography Group.
The reason for this opportunity is the real-time, distributed nature of the technology. Buyers, sellers, and manufacturers alike have the ability to share and track every item included in a potential transaction. The resulting transparency only becomes more valuable as the supply chain increases and spans multiple economies.
How can you get there? Your first step will have to be not implementation, but consistent deployment. By using Blockchain to improve your value and supply chain, you are taking it out of internal operations and introducing external components to it. That can only be possible with complete buy-in and implementation in areas that go beyond your purchasing or sales department.
The mutual benefits of this type of technology are obvious and should be the starting point of any conversation. After all, everyone in the supply chain wants to even power by increasing transparency, while also reducing costs. Still, the democratic nature of Blockchain implementation requires close cooperations between the various stakeholders.
How to Convince Your Manager to Implement Blockchain
All of the above can help you build a framework to implement Blockchain in your workplace, on any scale. And yet, none of it matters if you cannot convince executive leadership, who holds the purse strings, to go along with the concept. Doing so requires a strategy in and of itself.
Laying out the exact benefits of this technology is an obvious start. You should be able to clearly articulate just why and how moving to a distributed infrastructure can benefit your business. The more specific figures and estimates you can provide, the better. Industry research like this report by Bain and Company, who estimated that companies are saving up to $35 billion annually with implementation, can be immensely helpful.
Case studies provide another opportunity. Because Blockchain is still relatively new in a comprehensive business context, you might not find many real-life examples in your niche industry. Still, companies love to flaunt their success. Finding comparable examples in which the implementation improved business practices can be a valuable tool of persuasion.
Finally, build a roadmap towards success. Have a clear vision of how implementation will function, and how fast you can get to positive ROI. The steps outlined above should get you on the right track, but it makes sense to build it out with more company-specific information. How will you build, maintain, and optimise any infrastructure based on Blockchain? If you have the answer, you’re halfway there.
The blockchain is already beginning to transform entire industries. Jumping on now means taking advantage of a rising disruptor before many of your competitors do. The above guide should get you started on the road to success. It also pays to stay updated, so subscribe to TechRev to receive relevant updates related to Blockchain that could apply to your situation, company and industry.