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This article was originally published on LinkedIn.
Now, imagine if you are a large manufacturer with thousands of parts and supplies being ordered and delivered from multiple suppliers on a daily basis. How do you gain a similar level of complete trust in the latest status of every single update in such a complex supply chain?
In theory, that is the kind of holy grail that would save such a manufacturer a considerable amount of time, money and resources.
It is a hugely important challenge for any organisation that relies on large-scale transport and logistics planning. It’s exactly why we at HERE have been prototyping an implementation of blockchain technology into the supply chain for transport and logistics use cases.
Our objective is to use blockchain technology and our tracking solution, utilizing the combination of the two as a way to independently verify when a specific event happens in a specific location, in the context of the supply chain.
By combining the latest location intelligence and tracking technologies with blockchain technology, it’s possible to finally overcome the most frustrating, intractable problem for transport and logistics companies – not always having access to completely accurate real-time information about the location of the package being tracked.
Perhaps the simplest description of a blockchain is that it is a failsafe distributed ledger system. A digital record of transactions, in which individual records (blocks) are linked together in a list (a chain) using cryptographic technology.
Of course, many people still associate blockchain with Bitcoin and other cryptocurrencies. Yet with any application of blockchain methodology in transport and logistics – just as is the case with Bitcoin in a monetary context – it is the community which is the authority, validating the transactions. In the context of supply chain, the community is the group of all companies involved in the logistics process.
And it is that failsafe mechanism of automated generation of trust in the transaction that is blockchain.
Combine this with the latest real-time location and tracking technologies and you start to develop some truly unique supply chain, transport and logistics solutions that will finally offer those manufacturers and shipping companies that aforementioned holy grail: 100% trust in every single update that occurs across every supply chain.
In combining IoT tracking technologies, real-time location data and blockchain, you are able to verify that a transaction that you are notified about really happened at that specific time in that exact area.
Which, if you are running a large-scale shipping or logistics operation that involves the movement and monitoring of thousands of packages or assets at any given time, is a game changer.
What’s more, once you have 100% certainty on the location and the status of every single asset within your organisation, it also makes the automation of financial transactions far easier to achieve.
For example, if I am in a factory and I know that I am waiting for my parts to arrive, if the shipping company gives me the information that the parts have been delivered, I would normally automatically generate an invoice. However, if I am able to see that the exact location of the parts is somewhere else, I would wait for the parts to arrive (while simultaneously wasting time and resources locating the not-yet-delivered parts with the shipping company).
Blockchain allows me to make this entire process fully automated, because it gives you an exact location and guaranteed information that the updates you are receiving from the shipping company are accurate. By using Smart Contracts directly within the blockchain, the system can automatically generate an invoice based on independently verified data. This is a perfect example of a use case of blockchain methodology done within the context of supply chain.
The system gives the recipient a guaranteed and trusted notification that they have received their goods (or, for example, that their goods are situated in container #4526 in transit and are currently scheduled for delivery at the depot in approximately 39 hours and 12 minutes time), and that they can automatically generate the necessary invoice on receipt.
Finally, layering our mapping capability and rich location data to a blockchain record is also an incredible means of fraud detection, as you previously didn’t know if the delivery updates you were given were in fact accurate.
Blockchain now gives you the possibility to automatically verify the accuracy of such transactions, because it can match the real location of the object with the location report from the logistics company.
It’s a simple yet revolutionary concept for manufacturing, transport and logistics companies: seamless transparency of the location of any object that you are tracking — at scale.
HERE will be demonstrating and discussing its latest intelligent asset tracking initiatives further at CES 2019.
Logistics companies and logistics and planning managers of manufacturing companies keen to know more can hear me speak on the HERE CES Highlights Stage on January 8 at 2pm.