Blockchain Role in Supply Chain Management
Blockchain technology is one of the amazing inventions of our time. Its evaluation is remarkable and it has already had a considerable impact on supply chain management among other industries, like healthcare, food & beverages, and banking, etc.
Blockchain Technology helps to improve the transparency, scalability, openness, traceability, and security in different technologies. In this article, we will read about the blockchain role in Supply Chain Management.
Blockchain Technology in Supply Chain
SCM (Supply Chain Management) is a method for controlling the movement of materials, products, information, and services during the process of transforming raw materials into finished commodities for end users.
Supply chain and logistics are experiencing challenges such as human glitches, problems in processing, updates or Exchange of data and information, security, visibility, and transparency of different tasks and sectors or their activities.
Many different stakeholders, including suppliers, manufacturers, distributors, and retailers, are frequently included in complex supply chains. It can be difficult to track and trace products in such a setting as they progress from one stage to the next. Yet by offering a decentralised, tamper-proof record that can be read and updated by all participants in the supply chain, blockchain technology offers a solution to this issue.
Supply chain managers can increase visibility into how products and services flow along the supply chain by utilising blockchain technology. This makes it possible for them to follow products in real time, keep an eye on their quality, and spot any potential problems. Supply chain managers can swiftly pinpoint the source of a problem and take appropriate action, for instance, if a product doesn’t match quality standards.
Blockchain technology can enhance supply chain traceability in addition to increasing transparency. Blockchain provides a safe and unchangeable record of all supply chain transactions, including the source of raw materials, the production process, and the delivery of final goods.
This implies that supply chain managers can utilise the blockchain to more precisely and effectively track the movement of goods along the supply chain. For instance, supply chain managers can use blockchain to track a recalled product’s path and see any possible problems.
Increased efficiency is a key benefit of blockchain technology for the supply chain management. Blockchain technology can speed up and save money on supply chain management by doing away with the need for middlemen. By automating the verification process, for instance, smart contracts can eliminate the need for manual record-keeping and verification.
With smart contracts, the payment process can be automated, doing away with the need for middlemen like banks or payment processors. As a result, the supply chain’s efficiency is increased while processing payments takes less time and money.
The supply chain may be protected against fraud, theft, and other security issues thanks to the high level of security provided by blockchain technology. Blockchain offers a decentralised, impenetrable ledger that cannot be changed without consensus from all network participants.
This makes it more challenging for hackers or other nefarious individuals to alter or steal data. Moreover, blockchain can be used to confirm a product’s authenticity, making it more challenging for fake goods to enter the supply chain.
In the supply chain, counterfeiting is a serious problem that can lead to lost sales and harm to a brand’s reputation. By providing a tamper-proof record of all transactions that take place in the supply chain, blockchain technology can help reduce counterfeiting.
This record can be used to confirm a product’s legitimacy, ensuring that fake goods are found and taken out of the supply chain. This can lessen the harmful effects of counterfeiting on brands and consumers.
Blockchain technology is revolutionising supply chain management by enhancing transparency, traceability, and security. Supply chain managers may improve traceability, boost efficiency, and better safeguard the supply chain from security threats by utilising blockchain. They can also gain more insight into how items travel along the supply chain.
We can anticipate even more advancements in supply chain management that will boost the effectiveness and efficiency of supply chains as blockchain technology continues to develop. Supply chain managers are living in an exciting moment, and those that adopt blockchain technology are expected to benefit greatly in the years to come.