25 Feb 3 keys to implementing blockchain in business
The term blockchain is already prevalent in many markets, as it becomes a commonly-heard phrase in businesses all over the world. It’s true that the best-known blockchain technology is one linked to cryptocurrencies, or perhaps creating and distributing NFTs, but there is plenty of life beyond that. Although blockchain typically ends up being implemented much more quickly and widely in the technology sector, where the free circulation of information is key – such as in fibre optic or wireless communications –, this particular technological innovation could be applied in just about any other business area, given its innate characteristics.
Understanding what blockchain is to make the most of its applications
The theoretical foundations of blockchain technology can be rather complex to fully understand. However, the key to facilitating its implementation in all manner of companies is an understanding of the fundamental concept.
Blockchain is a DLT, or Distributed Ledger Technology. This means that when data is exchanged between two points – whether that’s financial data or something else entirely – there’s not one single entity that validates that exchange, but rather a series of nodes that all have to confirm its relevance and integrity.
This makes it much harder to corrupt or intervene in any data transaction from outside that distributed network of nodes. The higher degree of security this introduces means blockchain can be used across the corporate world, extending far beyond the world of finance alone. What’s more, it can apply to important exchanges in different value chains, achieving greater efficiencies and security when exchanging data, eliminating many of the stakeholders currently needed as intermediaries, even generating new business opportunities.
Blockchain as a ‘shield’ on the cloud
Implementing blockchain in a company’s cloud environment allows the information stored there to be ‘divided’ into different fragments that are differentiated but still dependent on each other. At the same time, it’s now even possible to encrypt those individual fragments, so only users with specific decryption keys can access all that information. As such, blockchain technology is being used to build far more secure clouds than ever before, an essential feature for businesses today.
Cost savings through blockchain
Thanks to blockchain technology, figures that act as intermediaries in lots of sensitive information exchanges are no longer necessary. Furthermore, the transparency, integrity and legal certainty of those exchanges is guaranteed. Reducing the economic ‘weight’ of these intermediaries will be evidenced on many companies’ year-end balance sheets. Although in this field, despite the obvious benefits, it needs to go alongside developments of the legal framework at the same magnitude, which is still ongoing.
Blockchain’s application in the value chain. New opportunities
As mentioned, blockchain technology stretches far beyond cryptocurrencies alone. As such, given its characteristics, it can bring value to supply chains related to various business models, as well as providing a variety of different services. Particularly in fields where the traceability or immutability of services are particularly valued by users. This is certainly the case in the agri-food sector, with distinct supply chains and certifications when providing services, for example. Blockchain not only helps improve these models, but also generates entirely new business opportunities altogether.
The importance of the digital transformation when implementing blockchain
Despite all the various benefits and potential new pathways, we mustn’t forget that, for the proper implementation of blockchain in the corporate world, unavoidable investments will be needed. Both in terms of time and other resources, including human, technological and material. In other words, we won’t be able to achieve any value from blockchain technology without – and in parallel with – entire companies embarking on a complete digital transition and transformation process. And that needs to involve all their processes, approaches, structures and working dynamics.