Using blockchain to improve supply chain trust
As part of our feature on serialisation, Joseph L Lipari, director, Cloud Implementation Services, Systech International, reveals the importance of blockchain in closing the supply chain trust gap.
Will we look back at this period as the time when blockchain revolutionised the way not only businesses, but consumers transacted with each other? Experts agree that there exists a fundamental gap in the supply chain today. That gap is trust. Manufacturers, distributors, importers, exporters, logistics providers, health systems and many other trade partners have had their sights set on compliance as deadlines rapidly approach. I would argue that as regulations come online, the need for a secure, interoperable system becomes all the more critical.
Enter blockchain, a technology which touts values such as immutability, security and trust. A technology that has captured the attention of global companies across all verticals and which promises to change the way business is done.
The trust gap
Let’s get in our time machine and rewind to the mid-1990s when a little-known company called Amazon was just starting to sell books online. This time period signified the pendulum swing from brick and mortar to the genesis of online retail.
Fast forward to today... We see more and more companies close their physical doors and expand their online presence. That fundamental shift changed the face of global business and pointed consumers to websites and portals and apps where digital information reigns supreme.
The life sciences supply chain is no different. With the advent of serialisation regulations, detailed digital information must accompany physical product as it transverses the global landscape. This ecosystem is missing a layer of trust, a layer which will protect that critical data and will provide an attestation of ownership and integrity.
But how?
Blockchain relies on cryptography, distributed ledgers and consensus to provide trust. The cryptographically hashed transactions are distributed to all trusted participants creating a decentralised ledger. There is no dispute regarding transactions because all participants agree to the same version of the ledger, thereby achieving consensus.
What emerges is a secure infrastructure for trusted companies to safely exchange data backed by an immutable platform. Will we look back at this period as the time when blockchain revolutionised the way not only businesses, but consumers transacted with each other?
Let's face it, as human beings the main reason we transact with another person is based on the trust we have that the other party will respond as expected. That type of gut instinct trust does not exist in the same manner in the digital world. Blockchain technologies have the potential to fill that trust gap, with one caveat.
Connect the physical to the digital for complete trust
If your supply chain challenge demands comprehensive visibility and trust, consider this: connecting the physical product itself with a trusted digital identity, ensuring authenticity when an event is recorded and managing all the transactions by a blockchain network is the closed loop required for complete, absolute trust. This blockchain would likely be private, with known, subscribed entities. When an entity joins the permissioned blockchain network they will be granted a private key, representing them on the network for posting and unlocking transactions.
This provides an additional barrier for grey market infiltration or diversion, as all the players and assets are known in the blockchain. However, that link is only as strong as the established trust. Serial numbers can be copied and the blockchain would be unaware.
Truly linking the physical to the digital and creating that immutable trust requires a different approach, an approach that can uniquely identify two identical items. An approach that absolutely creates that trusted link.