5 Ways Manufacturers are Using Blockchain for their Supply Chains

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The supply chain, the foundation of every manufacturing business, is the first area of blockchain implementation, where it will have a positive effect on efficiency, order accuracy, product quality and track-and-traceability. This will enable manufacturers to meet delivery dates, improve product quality and increase sales.

Capgemini Research Institute recently published a study titled, “Does blockchain hold the key to a new age of supply chain transparency and trust?” Researchers surveyed 731 organizations globally about their current and future plans for blockchain. Initial interviews yielded 447 organizations that are currently experimenting with or implementing blockchain.

Five key takeaways from the study include:

  1. Typical product recalls cost $8 million. With improved track-and-traceability enabled by blockchain, many recalls could be averted. The general ledger structure of blockchain provides a real-time audit trail for all transactions secured against modifications, making it ideal for audit and compliance-intensive industries.
  2. The top three drivers behind manufacturers’ blockchain investments today are:

o   Gaining greater cost savings (89%)

o   Enhancing traceability (81%)

o   Enhancing transparency (79%)

Improving track-and-traceability is a primary driver across all manufacturers. Additional regulatory compliance requirements are coming in 2019 and those manufacturers competing in highly regulated industries, including aerospace and defense, medical devices, and pharma, are exploring how blockchain can give them a competitive edge now.

  1. Blockchain will see the greatest adoption in:

o   Digital marketplaces

o   Tracking critical supply chain parameters

o   Tracking components quality

o   Preventing counterfeit products

o   Tracking asset maintenance

Managing supplier contracts is emerging as one of the most popular blockchain use cases for manufacturing organizations today and will accelerate as compliance becomes even more important in 2019.

  1. Manufacturers have the most at-scale deployments of blockchain today, leading all industries included in the study.
  2. A combination of blockchain and Internet of Things (IoT) technologies will revolutionize product safety, track-and-traceability, warranty management, maintenance, repair and overhaul (MRO), and lead to new usage-based business models for smart, connected products. In highly regulated industries (aerospace and defense, consumer packaged goods, medical devices, pharma, etc.), the blockchain and IoT combination provides real-time data on the shipping container conditions, tamper-proof storage, each shipment’s locational history, and any changes in temperature and product condition. Capgemini sees use cases where a sensor measures any change in a shipment’s temperature and sends alerts regarding contractual compliance of perishable meats and produce, averting the potential of bad product quality and rejected shipments once they reach their destination. Capgemini found that there were 456 food recalls alone in the United States last year, costing nearly $3.5B.

Is Blockchain for You?

Once solely connected to finance, blockchain is now making an impact in a number of industries that are capitalizing on the general ledger technology to improve operational processes.

Explore advanced blockchain concepts and applications in industries like yours, including supply chain, IoT, healthcare, energy, and finance, with IEEE. Advanced Blockchain for Enterprise is a two-day live virtual event taking place December 4-5, 2018. Register today and gain valuable insight into the future of this innovative and widespread ledger technology.


Columbus, Louis. (28 Oct 2018). How Blockchain Can Improve Manufacturing In 2019. Forbes.



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