Excerpts are taken from Report by Deloitte.
The wide world of technology has spewed up another one of its trademark, industry-disrupting creations: the Blockchain. And everyone’s looking for the right way of blockchain implementation. In the past few years, the focus has shifted from centralized to decentralized networks, organizations, and chains, and the blockchain has been primarily responsible for this ginormous shift.
Key organizations and individuals within them have been exploring the possible use-cases of blockchain technology and how blockchain-based products can transform the way things work. As time has passed, the need for decision-makers, executives and high ranking officials to explore the applications blockchain has kept on increasing.
Also Read: Blockchain for Food Safety
The commercial and organizational impact of blockchain can potentially be one of a kind. The blockchain implementation can prove out to be something that helps a company stand out from the rest. With so much noise, decision-makers who have just started exploring the use cases of blockchain technology are often misleading with the hype around it.
In our experience with the various blockchain projects with governments, enterprises as well as early-stage companies:
Slapping the technology and it’s name at any random problem won’t solve it. Doing in-depth research and performing comprehensive experimentation meshed-up with rigorous business study will.
So, in this blog, we decided to explain the roadmap on how to evaluate an use cases of blockchain to solve complex problems. From blockchain technology and it’s use case analysis to creating a foolproof Proof-of-Concept for blockchain based products, everything will be discussed in this post.
In simple words, the blockchain is a secure and time stamped ledger, copies of which are available to all participants on the network. Understanding basics about the blockchain are instrumental before going ahead to discuss stuff like use case of blockchain or implementing blockchain.
Cryptography is extensively used to secure the data, and new transactions are linked to previous ones. Hacking into such a network is pretty much impossible, due to the fact that one would have to take over 51% of the network to take control. Our experience with creating successful cryptocurrency exchange development has taught us the importance of cryptography. The blockchain is an exciting business and career opportunity in itself, with more and more companies shifting their focus onto how to exploit this technology to their benefit.
Let us take a look at why the blockchain should mean so much to executives and decision makers.
Why blockchain matters
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By 2025, it is expected that blockchain will result in USD 176 billion added business value, with the number creeping up to USD 3.1 trillion by 2030. The government of UAE too has issued a mandate which calls for all the government departments and public services product to be on blockchain by 2020. These magnanimous numbers alone are enough for some of the biggest leaders and entrepreneurs of the world to sit up and take notice.
This tells how serious key decision makers are about blockchain implementation and that they’re actually exploring use cases of the blockchain. At the very least, blockchain promises to make the backend operations of companies cheaper, secure and easier to manage, with this potential use stretching out to perhaps replacing companies altogether.
When combined with other technologies, the implementation of blockchain could seamlessly replace whole organizations. The Internet of Things, AI and blockchain when brought together could give rise to something that could totally eliminate, for instance, Uber or AirBnB and other platforms based on traditional technologies and processes. This is because of the nature of the blockchain to shift focus from an entity to software. Blockchain implementation in various processes would ensure that it is sped up and made more efficient. Many companies could one day see their demise right in front of their eyes, thanks to the blockchain.
When it comes to money or assets, peer to peer networks that are used to create or transfer assets can be easily created on the blockchain. We realised the potential of these P2P networks while working on Decentralized exchange development and solutions for our clients. These would not be run by any centralized parties and could be extensively used in the aforementioned point (replacing companies altogether). It may also make illiquid assets tradable or liquid, with new services and opportunities popping up in these areas. That is the sole reason as to why the banking and financial sector is looking forward to implementing blockchain for various processes that may become more efficient.
A step-by-step guide to the implementation of blockchain
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For executives and high ranking officials, it only makes sense that they keep afloat of all that there is to know about the blockchain, and how can it benefit their organization. Learning about use cases, proof of concepts, and scaling opportunities is all it takes to implement the blockchain effectively to benefit an organization.
Let us go through a step-by-step overview on how to perform blockchain implementation in any commercial organization.
1. Business Use case analysis
A typical use case analysis for a blockchain project involves a few major steps that we are about to discuss here. A quick look at these steps should be able to give you an overview about how to start the blockchain implementation in your organization.
a. Learning where the blockchain makes sense
Blockchain is not the be-all and end-all of problems. There are typical use cases where it makes sense to use the blockchain, such as in inventory management and supply chain management. It cannot be put to use in every section or area of an organization’s work. Weighing the positives and negatives of incorporating blockchain into a certain area or functionality must be done before the actual blockchain implementation takes place.
b. Inventory all the use cases
Once all possible use cases for blockchain have been identified, it is important to address them into an inventory, each of which address a certain business challenge. For instance, when more than one use cases solve similar problems, it would make more sense to group them into a single category, which would make further implementation of blockchain easier and more streamlined.
c. Assessment
For each use case, a thorough analysis and assessment needs to be carried out in order to identify the utility it will bring to the company. A blockchain based inventory solution isn’t really worth implementing if it does not increase the efficiency of inventory management and speed of item tracking, is it? Therefore, it becomes crucial to assess and rate all use cases based on the utility that they provide the organization with. Only then can further implementation of blockchain technology be thought of.
d. Prioritize use cases
Even after the assessment phase, it would be difficult to implement each and every use case inventoried in the above steps. Identifying 1–3 use cases, with the highest value offered to the organization, ranked on the basis of ease of blockchain implementation would be an ideal way to proceed. As a decision maker or higher ranked executive, you would have an overview of the type of resources that the company possesses. This would help you in prioritising the blockchain use cases that you want to implement and in which order.
2. Building a proof of concept
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Developing functional and technical architecture, and defining the minimum viable ecosystem are two of the most important steps of blockchain implementation that come under this step. The blockchain technology stack that is to be used will make all the difference, it could even perhaps make or break the chain.
Although, the use case of blockchain and the industry in which it’ll happen would be a governing factor too. The architecture of the system to be used should be the priority here, i.e. choosing the best technical and functional architecture to suit the system’s and the organization’s needs. What kind of blockchain you want to utilize also needs to be decided during this process.
Once all is said and done, get some developers to build and test the proof of concept for your use case. This would be a monumental exercise for your process of blockchain implementation. Either way, careful building and testing of the proof of concept is of vital importance, since this is the very concept that will give the blockchain network its unique nature.
After doing the testing, a retrospective phase is normally carried out. Here, the entire process is reviewed and checked for any errors in judgement that might have crept in while the conception of blockchain use case and application. Implementation of blockchain is a long drawn out process, therefore, to ensure the integrity and correctness of the same, a retrospective phase is of prime importance.
3. Scaling
Implementing a blockchain use case at a large scale is a totally different devil to deal with. Industrialization of the technology stack, the expansion of the Minimum Viable Ecosystem, creation and joining of consortiums, and many other steps highlight the process of scaling a blockchain use case.
Development of governance systems and operating models is perhaps the first and foremost step to be performed in the scaling process. Not only this, this should be weighed as a crucial factor while evaluating the various use cases of blockchain.
This is closely followed by testing and piloting the blockchain solutions in a real time production environment, and integration of the new tech with the legacy systems. Follow-up steps would include the industrialization of the technology stack being used, engagement of regulators for compliance if needed, and institutionalization of the operating architecture.
All in all, the tri-forked process of use case analysis, proof of concept design, and scaling constitutes a standard blockchain implementation in any organization.
Commercializing the blockchain: What a decision maker must know
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Although this part of the article warrants enough importance to have an independent piece, we are going to include a brief overview of the commercial aspects of the blockchain here itself. The truth is that organizations and firms must focus a lot of their resources on commercialization. We learned this while working on a blockchain implementation project with government organizations.
Use cases of the blockchain that involve clear-cut steps to achieve commercialization are more likely to survive in this heated up competitive world. Keeping in mind that blockchain use cases do not need to be very industry specific to achieve commercial success, decision makers and executives must also focus on enterprise-ready commercial applications of the blockchain, in order to gain maximum throughput from this very intriguing technology.
Blockchain implementation that solve unique value problems across the organization would be likelier to succeed, and if these use cases offer potential revenue sources in the near or long-term future, then it is all the better.
How to assess the commercial potential of a blockchain use case?
Executives can assess a few simple factors of each blockchain use case in order to evaluate its commercial relevance. These involve-
a. Considering the achievement of the organization’s vision and objectives
b. Evaluation of the implementation process, the roadmap, and how to maximize returns from these use cases
c. Requirements to implement these use cases- special skills, personnel, equipment, and where to find them
d. Potential for expansion and collaboration with other business partners, maybe as part of a consortium
Once you have completely done the assessment of blockchain implementation in terms of commercial factors, standardization comes next.
Standardization of the blockchain: imposing regulations and standards
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With the growth of blockchain, a need for standards and regulations, at least within an organization, keeps increasing. Standardization of the technology involves certain great benefits that, if harnessed properly, could take any organization to the next level. Before talking about how to carry out the standardization process, let us look at the benefits it offers to individuals, employees and the organization as a whole.
1. Validation of the proof of concepts developed in the implementation stage
2. Sharing of enterprise solutions and collaborations with other organizations
3. Avoiding a ‘jack of all trades, master of none’ situation by focusing on one or two technologies rather than basic knowledge in all aspects
Now, executives or decision makers might think: if there are no current worldwide standards for blockchain, should they wait for some to come up, or take the initiative and make standards themselves? Should the team at some XYZ organization work to define some standards and regulations themselves? The truth is, not all organizations are equipped to handle this.
Some of them are straight-up not so influential in the blockchain or IT world to enforce standards formed by themselves. Internally, executives and high ranking officials may influence their organization towards standards that help achieve the organization’s mission and vision, but on a larger scale, this presents a different challenge altogether.
In the near future, if some sort of standards are enforced, multiple value blockchains could even be integrated into a single chain. Solutions from different organizations may be clubbed together to form large scale, commercial products out of the blockchain. Current problems faced by this idea include the incompatibility of different blockchain protocols, for example, Ethereum and Hyperledger. It is difficult to integrate these two technologies into a single ecosystem, hence, multiple blockchain integration still has a long way to go.
Where to start? How to carry out the whole process?
A brief overview of the entire commercialization process for decision makers and executives has already been discussed in the previous sections. Here, we attempt to outline a step-by-step, clear-cut procedure to follow, in order to implement blockchain at both a scaled and a commercial level.
a. Does your company actually need blockchain?
As discussed before, blockchain is not a solution to everything. Researching and analysing whether blockchain will actually fit your ecosystem is probably the most important step when it comes to implementing this technology. It is important to understand the extent up to which blockchain can benefit your organization.
b. Decide on a single use case and work towards it
After you realize that a certain blockchain use case benefits your organization the most, dedicate yourselves fully to it. The path to blockchain commercialization often involves determination to stick with a certain use case that you believe has the potential to disrupt entire industries.
c. Regulations and rules are made to be followed
As multiple parties come together to work on the blockchain, and consortiums are formed, rules and regulations will be required at one point of time or another. It is best to have all entities know and recognize their roles and responsibilities, and follow all set standards and regulations. Clearly defined processes and rules will only aid further development of all entities involved.
d. Hire quality talent to work on the blockchain
As an executive, it is your responsibility to ensure that your organization has the best talent in the game working for it. Blockchain is still a new concept, therefore, a lot of the talent in the industry has not been snapped up by companies as of now. This is the time to pounce, and have some of the best minds in the sector working for you.
Follow these steps to the letter, and in no time will you have a strong, commercial blockchain use case ready to do the magic for your company.
Still have your doubts? Read on about some famous commercial blockchain projects that are sure to inspire you.
A trade platform aimed at payments using blockchain, Hyperledger has fast become one of the most popular blockchain platforms out there. It runs through the IBM cloud, and is renowned for its scalability.
Blockchain enthusiasts must have heard of Corda, R3’s major project in the blockchain space. It is one of the first distributed ledger programs introduced to the industry. Focusing on governmental acceptance, R3 has fast become a popular choice for all blockchain institutions, especially financial.
To sum it all up, as decision makers, and high ranked officials, knowing all about blockchain and its commercial implementation could reap rich rewards for organizations. Potential use cases, standardization, commercialization and other processes discussed in this article provide an overview of the entire process. If you as a decision maker are looking to implement blockchain into your organization, now is the time to act.
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