With an aim to improve manual and cumbersome supply chain management, the International Business Machines Corp (IBM) has launched a new blockchain network called ‘Trust Your Supplier’.
Supply chain management is the system that looks after the flow of goods and services, like tracking the movement and storage of inventory, raw materials, and finished goods. It has been identified that supply chain management is the one which can totally benefit if blockchain technology is applied.
As per a technology research firm Gartner, the blockchain will support the global movement by 2023 and will also help in tracking of USD 2 trillion of goods and services annually.
The other founding participants are Anheuser-Busch InBev, Cisco, GlaxoSmithKline, Lenovo, Nokia, Schneider Electric and Vodafone.
The technology is being provided by a blockchain specialist firm, Chainyard. It is also building the network using IBM’s blockchain platform. The other companies, meanwhile, are putting their supplier data onto the network and contributing their expertise to expand the network.
“Traditional methods of managing suppliers often involve cumbersome manual processes, which make it difficult to verify identities and track documents such as ISO certifications, bank account information, tax certifications, and certificates of insurance,” IBM said.
By using a decentralised approach and an immutable audit trail built on blockchain, the company said the new network would eliminate manual time consuming processes and help reduce the risk of fraud and errors.
“The validation and onboarding of new suppliers is a critical pain point for virtually any company that relies on a robust supply chain to conduct business,” Marie Wieck, general manager for IBM Blockchain, said in an email to Reuters.
“By moving this process onto the blockchain, we’re taking much of that burden and shifting it to the network, where it can be shared in real-time more securely and efficiently.”
Wieck said IBM’s own procurement organization projects a 70 to 80 percent reduction in the time it takes to get new suppliers onboard and an estimated 50 percent reduction in administrative costs within its own business.