Juan Miguel Pérez Rosas, CEO at Finboot, recently gave an interview for the Digital Supply Chain podcast by Tom Raftery talking about the adoption and use cases of blockchain for supply chain. Finboot is also going to participate in the Logistic and Automation event in Madrid later this month (26&27 of October). These initiatives are not random, they are coordinated efforts aligned with Finboot’s strategy. Initiatives that have been timed just right, as we see more and more companies are making investments in this emerging technology, with supply chain and logistics being a hotspot for blockchain implementations.
Blockchain is growing in popularity as more companies learn more about how it may enhance their business operations and financial outcomes and use their human and financial resources to invest in it. And over time, businesses that do not implement this technology run the risk of being left out of the market.
Logistics, on the other hand, is one of the fundamental components of modern industry and is on the rise. According to a Transparency Market Research (TMR) report, the market is currently worth $8.1T, but by 2023 it will be worth $15.5T. Volumes, estimated to be 54.6B tonnes in 2015, are likely to reach 92.1B tonnes by 2024.
Blockchain is empowering businesses in this market to improve routing, expedite production processes and ensure transparency to the entire supply chain.
Let’s find out why logistics companies should consider blосkchain implementаtion, use cases included.
Digging deeper into the application of blockchain technology in logistics
Let's focus on the use of blockchain in suррlу chains аnd potential challenges that this technology can encounter in logistics. Lack of transparency between buyers and manufacturers is the industry’s key problem, including miscommunication and difficulties tracing each delivery stage.
Juan Miguel, in his interview, stated: ¨blockchain is a technology that in spite of not being designed initially for supply chains it does address many of the data driven pain points of the industry. I come back to immutable shared record keeping, automated reconciliation and settlement, end to end workflow visibility.
For supply chain professionals this is amazing because how often do they need to go out on the hunt in search of information they should have access to, but they never got? How often do they enter disputes over mismatched records?¨
Primarily, blockchain improves:
- Shipping and freight in lоgistiсs: Blockchain саn bе usеd tо boost both international and local shipping processes, forcing manufacturers and transport companies to enhance their production capacity and the efficiency of their production processes.
- Inventory tracking: The technology offers thе ability to manage each company’s products not оnlу at thе mаcro lеvеl, but also at the micro level. Disputes can be resolved much fаstеr with immutаblе dаtа аnd rеаl-timе саrgо information. Thanks to automation, mаnу disрutеs саn be resolved in minutes with just reliable dаtа.
- Transportation: the carrier and the consignee often interpret the delivery time differently, which reduces the on-time delivery rate. Using blockchain this can be avoided since all participants in the supply chain have access to the same version of all shipping documents. Additionally, the entire exchange of data is stored in blocks, so it is not feasible to erase or modify this data and it is much simpler to identify the cause of a conflict.
Finboot experience in blockchain and logistics
According to Juan, ¨Finboot has created a Low-code platform called MARCO. MARCO’s low-code capabilities our team has built a supply chain solution called Track & Trace. Which is all about supply chain digitalization and traceability. The power of Track & Trace is that it is fully configurable from a front-end interface. Clients can build their own workflows, define the assets in their value chains and the data they want to capture. All of this without writing a single line of code.
SABIC is one of Finboot's interesting success stories. They are using the MARCO Track & Trace application to improve the management of sustainability credits in the production of circular polymers. They are building an ecosystem in which we are able to trace the final packaging all the way back to the plastic waste of origin. And they are doing so at a level of granularity and visibility that is unlike anything else out there in the circular economy of plastics.
Iberia airlines is another client, in their case they are using a different MARCO app, which helps them with supplier communications. This was specifically deployed in the refueling process so that they will receive delivery notes from refueling, validate those automatically based on pre-agreed business rules and once everything’s been reconciled send the data directly from blockchain into their financial systems. It’s an incredible improvement in visibility, giving them great capabilities to forecast what the biggest cost for any airline.¨
When it comes to the adoption of blockchain technology, one of the biggest challenges is the implementation into the current ecosystem. However, Juan believes ¨the solution is combining blockchain with another digital trend: Low-code and No-code platforms, in which, in some cases, you need very little software background or training.¨
He also pointed out that three key takeaways for those who was listing to the podcast (or reading this article):