Germany’s car manufacturing giant has announced the development of a blockchain prototype for the management of supply chains.
Giving almost no detail on how this is meant to work, or what blockchain platform this is using exactly, Mercedes’ parent company, Daimler, says:
“The placement of contract clauses in the Blockchain creates a sustainable transaction book. The disclosure and confirmation of the Daimler sustainability requirements can be retraced by all participants in the supply chain.
This ensures that global procurement and contractual practices meet the stringent requirements of Daimler AG. Confidential information is not visible.
The prototype creates trust in the integrity of the supply chain by disclosing sustainability-related information, without revealing competition relevant information.”
They say they’re a member of Hyperledger, with Daimler previously announcing a somewhat more finance related $110 million blockchain pilot in June 2017.
“Blockchain technology has the potential to fundamentally revolutionize our procurement processes, and could affect nearly the entire value chain,” Wilko Stark, Member of the Divisional Board of Management Mercedes-Benz Cars, said before adding:
“Global supply chains are becoming increasingly complex. With our Blockchain prototype, we are in the first step testing one of diverse possible applications with the aim of increasing transparency beyond our direct suppliers.”
Blockchain tech can be used to facilitate coordination by providing individuals the ability to enter data, but not to change them once the data has been entered.
It does not assist in authenticating whether the entered data is actually valid. More traditional quality control processes have to be utilized there.
Once the data is entered into the system, however, it can not be changed by any participant on their own if that is the desired set-up.
Naturally sometime innocent errors might be made. In that case, instead of deleting the data, a new entry can be made to correct the previous entry.
In instances where many different actors participate, this could allow for the sharing of data in a way that all can be sure of who or what role entered the data and in a way that whoever enters them can be sure no one can or has changed them.
This could allow for more efficient coordination and for in effect the digitization of paper documents. An easy comparison here would be sending around a PDF while everyone in real time can see who made changes to the PDF and what those changes are.
Or in proper set-ups it might not be much different than sending a paper around, with individuals then able to write on that paper whatever they want, but here in the digital version they can’t destroy the paper, and they can’t cleverly erase any previous writings, and obviously any changes would be instantly visible to all and so on.
This could increase efficiency and effectively digitize industries or professions where paper is desired due to its “hard” properties of being relatively unchangeable as the blockchain can potentially replicate those qualities in a digital form.