It’s hard to match the hype of an upcoming Super Bowl but blockchain is giving it a shot. You can’t go a day without a story about blockchain in the trade and business press. Some companies have even changed their name to include the word “blockchain,” without even having the technology to back it up.
Blockchain – Is a Hybrid Model the Best?
Despite all the hype, blockchain merits a discussion and serious consideration as the upside benefits for its use and application in the fresh food supply chain is significant. But, at this point, is blockchain a technology looking for a problem to solve, or a way of solving or improving the solution of a known problem? And, how does implementing blockchain relate to your existing business processes? Can or should blockchain replace your current systems or is a hybrid model the best?
It’s prudent to find ways to apply blockchain to address known business issues, as this will significantly improve its chances of being successful. And there are many solid use cases that exist in the food fresh supply chain today. Food safety and traceability are often cited as a place to start but ensuring food freshness can also benefit from the intelligent use of blockchain technology for the fresh food supply chain.
Things to Consider Before Implementing Blockchain
A new article published by ChainLink Research discusses how food traceability and freshness can also be managed by networked SaaS solution without the need for blockchain. However, the author, Bill McBeath, states that “recording the various transactions, HACCP steps, and temperature readings onto a blockchain can add trust and additional capabilities to the system.”
In addition to discussing applications of blockchain solutions, the article identifies several key things to consider before you begin on your blockchain-enabled journey:
- It’s essential to put the right data into the blockchain to achieve true transparency, as one of the main benefits of blockchain is enabling all relevant parties to have access to the data. There’s immense value in collecting quality-focused data on its own, but analyzing, applying and making traceability, food safety and food quality data broadly available is where the benefits really start to multiply.
- It’s important to have a blockchain agnostic architecture. There are many different blockchains today and no industry standard and, as with the Super Bowl, it’s too soon to find out who the winners and losers will be. Betting exclusively on one may prevent you from working with companies in your supply chain that use another.
- Understand the role of public versus permissioned blockchains. For supply chain use cases, a permissioned blockchain may make more sense.
- Know the difference between blockchain-enabled Smart Contracts and off-chain automation in your existing business applications. While utilizing smart contracts in a blockchain may be feasible, it may not be the most cost-effective approach to solving your business needs.
Stop What You’re Doing?
This leads to the question of whether or not you should abandon your existing SaaS-based approach in favor of a blockchain approach. The answer is no. Each brings advantages to the game. McBeath states that, ultimately, hybrid systems combining SaaS and blockchain models will prevail.
“Blockchain technology alone cannot provide freshness, safety, provenance, and recall capabilities. That requires data and capabilities from outside the blockchain. It seems the best emerging approach will be a hybrid consisting of 1) a centralized networked SaaS platform providing economical scalability and deep algorithmic and process capabilities, combined with 2) blockchain and smart contracts for transparency and validation. Blockchains are attractive because of their ability to create a shared, trusted single-version-of-the-truth between trading partners. However, a networked SaaS platform can provide a shared, trusted single-version-of-the-truth at a much lower cost.”
The ChainLink article delivers a very comprehensive and compelling perspective on blockchain, separates today’s hype from today’s reality and presents a navigable path forward. It provides a solid perspective on where you should start when considering your blockchain project. You can download your copy of the Chainlink Research article here.