Prove your blockchain concept in 12 weeks or delete it

Blockchain goes beyond early users to address more businesses. This could disrupt traditional practices, particularly in the areas of purchasing and the supply chain. And this can reduce operational and financial inefficiencies and generate new sources of revenue.

Blockchain is a technology that all businesses should consider. But he was also overexcited. As with Big Data and Hadoop before it, believing that you can implement blockchain overnight – and without a legitimate business need – will result in failures, embarrbadment and scrapped budgets.

A jump-all-all approach and starting over with a blockchain is doomed to failure. A series of small controlled explosions with a specific timeline is a better way to test and create a blockchain capability. By adopting a measured blockchain approach, you can test the technology according to the parameters of existing processes and systems to augment or improve certain areas of your business. If you can not prove that the blockchain is useful and profitable after 12 weeks or less, delete the project and try again.

One step after the other

Success does not require a complete and radical overhaul of existing technologies using the blockchain as a technique of extraction and replacement. On the other hand, when blockchain strategies are deployed like controlled explosions – small projects with limited hit radius – the teams better manage the risks, learn and experiment, to evolve towards the ultimate goal: the scale from the business with a real impact on the business.

Start with a vertical or functional domain, ideally with a well-defined project that can be completed in 12 weeks. Blockchain, like any emerging technology, requires significant process redesign, culture change and collaboration. A smaller experience will provide the information needed for successful adaptation to larger projects.

Based on several blockchain experiences I've seen in various industries, such as industrial manufacturing, healthcare, and telecoms, a 12-week period is enough to create, test, and measure proof of concept while avoiding overinvestment in an unsuccessful project. In some cases, you may even want to shorten this window to 10 weeks. A defined timeline encourages blockchain teams to perform quick badessments and adjustments, demonstrate a positive return on investment, and ensure that the blockchain under construction can eventually be used for production-level deployment. In other words, if they can not overcome the complexities of a small blockchain project during a fiscal quarter, it will be difficult to reach the entire company.

These experiences can take place in one of the three main areas of business: the front office (such as sales or customer management), the middle office (such as the operational areas of supply and supply chain). procurement) and the back office (corporate finance). , accounting, HR.)

A well-defined project, tested within the confines of a proven enterprise resource planning (ERP) framework, will have the best chance of generating value for the business .

For example, drug recalls and fraud are a major problem that can be deadly – so the US Food & Drug Association unveiled a new law on drug supply chain security (DCCSA) to combat this problem and to give more visibility to the pharmaceutical supply chain. The Blockchain is actively used to help businesses comply with this new law, a step that could save lives.

Fraud is also prevalent in the high-end goods market for items such as art, jewelry, antiques and luxury fashion and is treated with the blockchain. With increased traceability of product origins and ownership, companies eliminate counterfeiting. In the future, the blockchain will give brands a better understanding of the history of a product.

Finally, the blockchain is used to cope with sudden and unpredictable changes in tariffs and taxes. Increased visibility on the cross-border movement of goods allows companies to streamline their tax payments, which will bring significant benefits.

With the hype surrounding the blockchain dictated by the cryptocurrency, it is time to consider this technology in a more realistic context. By defining the parameters of when and how to take advantage of the blockchain to solve a business problem, businesses will appreciate its value: process transformation, operational efficiency, cost reduction and the creation of new revenue streams.

Arun Ghosh is the US blockchain leader at KPMG Professional Services.