Blockchain is a revolutionary and innovative piece of technology which was explored but underutilised in 2018 by global businesses. N.B. It was the highest searched word term by C-Suite executives on Gartner.com in 2017. So clearly, business leaders were already keen to explore the power and potential of the technology. LIFE will most definitely be watching with interest what 2019 holds for adoption and uptake, especially for those that are intrigued to go a step further and actually deploy blockchain adoption in various guises. This ultimately could well be the window of opportunity for businesses to get ahead of the curve and beat the competition, whilst your industry colleagues are still shying away from it. Notable factors in this are education, awareness, cost and trepidation of the unknown. Sounds a little like like the internet in the 90’s don’t you think?
There are many different ways you can benefit from this technology. Let’s start with what blockchain actually is? Blockchains are used for recording transactions. It’s simply a growing list of digital records (or blocks) linked together in a single list, called a chain, using cryptography. Each transaction added to a blockchain is validated by multiple computers on the internet. These internet systems are configured to monitor specific types of blockchain transactions forming a peer-to-peer network of approvals. They work together to ensure each transaction is valid before it is added to the blockchain.
This decentralized network of computers ensures a single entity cannot add invalid blocks to the chain. When a new block is added to a blockchain, it is linked to the previous block using a cryptographic hash code generated from the contents of the previous block. This ensures the chain is never broken and that each block is permanently recorded. It’s also intentionally difficult to alter past transactions in a blockchain since all the subsequent blocks must be altered first. Each block contains a timestamp of transactional data. Blockchains are immutable, which means it’s almost impossible for anyone to be able to modify a ‘distributed ledger’ of blocks, which is another reason why the technology is so secure and trustworthy.
The benefits blockchain can have for businesses are absolutely colossal from data privacy right through to invoking trust. Here are a number of examples.
Traceability & Trust
Being able to trace information and data is vitally important as it builds long term trust and confidence with customers and consumers. Examples include the transferring of funds or contracts digitally, charitable donation tracking for specific missions and projects, tracking logistics and the delivery of goods and services. In essence, helping businesses become more streamlined and efficient.
One of the most talked about benefits is primarily for non-profit organisations (NGO’s). Non-profits are able to use blockchain technology to generate more donations by creating an additional trust factor. Blockchain can be used to help customers track their donations from start to finish, so people can see exactly where their money is being spent, therefore creating more trust between the cause and the donor. A recent study with the LIFElabs.io community and social fan base of over 10,000 people found that 82% of them would donate more money and more often if the charity utilised blockchain technology to highlight where their money was actually being spent.
Privacy & Security
This can also be used to help protect personal data, which is great news for any EU based businesses, helping them to align with the likes of GDPR compliance, which was introduced last year. If you keep personal data in the blockchain it gives the owners of that data more control, not only allowing them to feel more comfortable with sharing their data but allows for more secure storage of private information. If you respect the privacy of your customers and your local privacy laws, you should definitely consider using blockchain technology to store data. This technology also allows you to validate ownership of goods, products, services or funds, which allows for heightened security and management of your business assets.
Efficiency & Effectiveness
Blockchain can help your business reach peak efficiency with it’s tracking abilities, human error is guaranteed at some point, whereas the use of blockchain in your business can help to avoid mistakes in things such as your accounting, contract document location and quality assurance audits.
The use of smart contracts or self-executing contracts with the terms of the agreement between buyer and seller is directly written into lines of code, not only does this help eliminate human error, but also removes the need for middlemen or costly third-parties. Due to the fact that they are self-executing, they can also save hours of valuable business time.
A blockchain system can also lead you to the point of origin when irregularities are found within supply chains, allowing you to solve any arising issues much faster and more effectively.
Another effective way of running a business is faster global transactions. We have seen the capabilities of cryptocurrencies in sending large sums of money all around the world within minutes, all for transactions fees in their pennies! This could allow your business to reach a global scale (if it isn’t already there) or help you manage your global operations with ease and effectiveness.
We hope we have been inspired to consider and contemplate the use of blockchain technology in your next business modelling strategies. if you’ve already embraced it then we congratulate you and would love to hear from you in the comments below or alternatively simply email us at [email protected]
For more articles like this don’t forget to follow us on Facebook and Twitter. @LIFElabsHQ