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IBM Is Building the Future of the Supply Chain Industry Using Blockchain

August 8, 2019
Ross Peili


IBM Is Building the Future of the Supply Chain Industry Using Blockchain

IBM shouldn’t be a surprise player when it comes to blockchain technology and distributed network systems. The computing giant, in fact, owns the most patents filled regarding blockchain during the last decade. 

In addition, IBM has its own blockchain called Hyperledger, among other DLT projects, and even Blockchain-creating platforms that allow, mainly companies, to develop their own distributed ledger solutions.

Obviously, IBM’s platform is private and you won’t find a token or crypto-related products indicating IBM’s customers, market capitalization, and liquidity levels in trackers such as CoinMarketCap

Some of IBM’s partners include, but are not limited to Walmart, CISCO, GlaxoSmithKline, Lenovo, Nokia, Schneider Electric, and Vodafone, hence the privacy mentioned above is well deserved. 

According to IBM’s latest announcement, the enterprise service provider wants to develop what they call a “Trust Your Customer” (TYS) supply chain verification protocol using blockchain technology developed by DLT service provider Chainyard.  

The Key Challenge: Visibility and Data Management

In a research, conducted by IBM’s Insitute for Business Value (IBV), we find Fortune 1000 and Global 2000 companies, and more specifically their respective Chief Supply Chain Officers (CSCO) confronted with challenges that impact their businesses’ integrity and generated by the current supply chain tracking standards. 

With TYS large companies, heavily dependant on their supply chain, will be able to geographically track their products, access the geographical history of a specific product, as well as see other information regarding its logistics conditions, such as temperature throughout the chain’s route, handling conditions and more. 

According to the document, 84% of CSCOs say a lack of end-to-end supply chain visibility is their top challenge, while 80% of data is dark and unstructured, posing a risk to the business. 

Furthermore, 77% of CSCOs say big data analytics is both disruptive and critically important to the business.

Having more data points on their products, operations, as well as other physical assets, such as vehicles or personnel, a company can be ready to face predicted challenges and be agile enough to create sustainable solutions for virgin, unpredicted problems that may appear during operations.  

IBM believes that most enterprise-level companies today lack transparency into important links in supply chain processes, as well as a clear view of the operations required to predict and prevent disruptions and inventory imbalance. 

Blockchain in supply-chain

It’s not the first time we see Blockchain technology proposed to be used in the supply chain field, and the popularity of this new method of understanding your own business better will only rise as time passes and the demand for clean and transparent data grows on a worldwide scale. 

IBM has previously worked with Walmart in order to create a solution for the supply chain of imported food in the US. 

Walmart can now track where an apple came from, for how long it was traveling, under what conditions, as well as identify the first-hand farmer, the intermediates involved in the operations, such as collectors or drivers, and even the final customer who just got the apple off the shelf. 

Similar projects have been developing in China by Blockchain project Walton, which uses an IoT protocol in combination with RFID technology to identify and track physical goods such as clothing, and bags.