Once upon a recent time, blockchain was the stuff of only the wonkiest watercooler conversations.
But now, it’s about to enter the mainstream in a huge way — and likely revolutionize entire industries as it does.
Blockchain offers a way to share unalterable data between multiple parties. It has implications for the security, transparency, storage and transmission of our digital information. Blockchain might even remake the very idea of “currency.”
IBM and Maersk announced a partnership recently and provided details on a blockchain-based logistics platform that would apply artificial intelligence, connected devices (IoT), and intelligent, proactive analytics that could foundationally improve upon the supply chain as we know it.
Maersk, as you likely know, is one of the world’s largest shipping concerns. International Business Machines also needs no introduction.
The match is apparently perfect. IBM has been quietly innovating in a variety of “back-end” technologies for a while, so who better to bring about a sea change in how goods and products make their way around the world?
Out to Sea and Everywhere Else, Too
We say “sea change” for two reasons. First, because Maersk may best be known for its mammoth cargo ships, replete with, in some cases, hundreds of containers full of merchandise either arriving in the United States or being shipped overseas.
Sometimes products leave the States for finishing elsewhere. Other times, products are assembled elsewhere in the world and sent completed to our shores.
But whatever we’re shipping and who’s most excited to receive it, it’s clear that we don’t always get this complicated web of shippers and vendors and transportation analytics quite right. We’ve seen in the news over the last few years what can happen when just one piece of this puzzle goes a little bit amiss.
In Long Beach, Calif. and Los Angeles as recently as 2017 the United States’ largest cargo shipping facilities incurred estimated losses of $8 billion during labor-owner disagreements about wage theft, subcontracting and general work environment.
The intelligent supply chain functions IBM and Maersk propose have the potential to, in many cases, vastly outperform that same work had it been done by a human worker. Lean and just-in-time manufacturing and shipping are the necessary future of industry, but aren’t possible without analytics so proactive that they approach the artificially intelligent.
Pair that with blockchain-based cloud storage for shipping, cargo manifests and the other incomprehensible reams of bureaucratic red tape — all signed, sealed and kept accessible to every authorized party — and you can see the potential for blockchain to introduce some order.
So Why a Figurative Sea Change, Then?
Quite simply, because the idea is catching on. Soon after IBM and Maersk made their collaboration public, shipping and customs organizations in Peru and Singapore expressed interest in taking part in the platform.
Their interest lies in more efficiently organizing trade and improving supply chain security from end to end. The point, ultimately, is that this platform — which IBM believes is a cross-border, industry-wide supply chain solution — will democratize commerce in a way we haven’t been able to achieve until now. We just didn’t have the right technology yet.
This Blockchainges Everything
Yes — it really does all come back to that wonky little word that’s more and more a household term. “Bitcoin” entered the mainstream a little while back and it, too, is based on blockchain. But why is this going to be such a big deal in manufacturing and shipping? Think about it like this.
A while back, the United States government began requiring public and private healthcare providers to digitize patient files. The idea was a person’s Electronic Health Records and history should be able to follow them wherever they happen to be in the country and no matter which insurer or service provider tended to their needs.
Mobility and accessibility was the goal there, just as it is in this proposed cross-border supply chain data solution. We’re already familiar with the idea of cloud storage — digital patient records are a popular example — but blockchain will bring the security of cloud storage to new levels.
One of the few real criticisms of digitizing sensitive patient records was the nagging sense we were “putting ourselves out there” or “at risk” of data theft.
Instead, blockchain proposes security standards that are, in as real a sense as currently exists, “hackproof.” The only notable blockchain breaches on record happened because, as one pundit put it, the companies in question “tried to centralize a decentralized platform.”
The key to blockchain’s success is that it “splinters” our data in a way that renders individual compromised “blocks” of it useless to thieves unless they have every piece of the puzzle.
Stronger Security and Less Fraud With Blockchain
In other words, it’s great for medical records as well as shipping manifests and supply chain analytics. We need trust at every level of business, including manufacturing and transportation, but even as our technologies have allowed us to broaden our business horizons, it has also made our sensitive information more vulnerable.
When we don’t have to rely on trust any longer and the attractive nuisance of exposed cloud data is protected instead with blockchain, all parties can breathe a little easier.
If you can believe it, 45 percent of money exchange services and intermediaries — which are often involved in cross-border shipping — experience some form of “economic crime” each year. What if blockchain could render some of our digital plunder un-stealable?
That’s the goal, anyway. Thanks to its potential to reduce fraud and improve regulatory compliance, customer relations, general security and more in the financial services, healthcare, real estate, energy and records management industries, blockchain could influence a huge portion of our daily activities as well as the infrastructure that makes modern life possible. For all of the above reasons and more, this is a technology to watch.
As an IBM representative pointed out, human civilization moves $4 trillion in manufactured goods each year — a process they claim could be vastly less expensive and far more efficient if we roll out this technology on a large scale.
IBM and Maersk are two of the latest proponents of blockchain technology, but they are far from the last.
Kayla Matthews is a tech and productivity journalist.