Most of the world’s leading organizations run computerized enterprise resource planning (ERP) and supply chain management software. With the giant leaps in technology, new yet promising opportunities are being presented in a bid to improve the supply chain and cut costs effectively.

It comes as no surprise then, that using blockchain in the supply chain has the potential to expand drastically the supply chain transparency as well as traceability whilst reducing considerably administrative costs.

Supply chains hold trillions of document copies and copies of copies between parties. There is an enormous complexity that comes into play here. Between tracking, reconciling as well as verifying a barrage of inventory including purchases, invoices as well as receipts, it can be quite challenging.

This is where blockchain plays a fundamental role since it can decrease costs and increase efficiency benefits. Any potential problems with miscommunication or reconciliation will become a thing of the past.

How does blockchain simplify the supply chain?

The benefits are plenty and in today’s digital market, Supply Chain leaders should act as soon as possible to take advantage from blockchain in core areas of their business operations. Benefits include:

• - Removing unnecessary paperwork: Blockchain creates tamper-proof ledgers between parties
• - Having a single style: It enables the enforcement of contract terms by replicating across partners.
• - Smart contracts: This advantage ensures that when records are created, there are no out of balance conditions and removes any bad invoices.

Why is it beneficial for you?

Think about it. For every simple application of blockchain technology in supply chains, it can save you major costs and improve proficiency. From communicating with suppliers and clients to reducing significantly transaction volumes and irregularities.

Let’s delve deeper into blockchain smart contracts. A smart contract is essentially a software script that describes the relationship between users like regular legal contracts but with some distinct exceptions.

A smart contract is stored in the blockchain and creates actions under “if-than” conditions by eliminating intermediaries. Everything is well-controlled using this pre-written script, thus abolishing any human error.

What is Ethereum and how does it relate to Blockchain?

Ethereum is an open software platform constructed on blockchain technology, that gives developers the power to create and deploy decentralized applications.

Somewhat similar to Bitcoin, Ethereum can be described as a distributed blockchain network. There are two key differences between the two. Bitcoin provides a peer to peer electronic cash system by facilitating Bitcoin payments, while the Ethereum blockchain specializes in running a programming script of any decentralized application.

What is Ethereum used for?

Since it enables developers to build and deploy decentralized applications, they are not controlled by a specific individual or central entity.

Think about all intermediary services that exist across a mammoth of various industries. Services such as loans require intermediary services such as title registries, regulatory compliances and so much more.

Ethereum thus can be applied to create Decentralised Autonomous Organisations (DAO), which is autonomous, decentralized and most importantly, without a single leader. DAO’s run on programming scripts within smart contracts written on the Ethereum blockchain.

This code removes intermediaries, a barrage of rules as practiced in traditional organisations and eliminates the need for manpower and manpower costs.

What are the benefits of blockchain smart contracts?

With the increasing growth of smart contracts as part of the development of cryptocurrencies, Ethereum, gives you the power to create your own smart contracts. The benefits are as follows:

• - No intermediaries: With the absence of intermediaries, the process will be faster as well as simpler. There is no need to seek assistance from a lawyer as it follows a pre-written code.
• - Extra safety features: All smart contracts are stored in encrypted form in the blockchain. The main aim of this system is that no one can alter the contract or amend any data. Additionally, private keys are applied for signing, which increases the level of security as well as confidentiality.
• - Cost-effective: Since it excludes intermediaries, the program can be used for a variety of transactions and different users, saving you both time and money.
• - Speed: Administrative paper-work can take ages. Using blockchain smart-contracts can boost speed to process as well as conclude transactions.

Where are smart contracts most effective?

Since smart contracts are self-executing in nature, they are better suited to some industries and organisations over others.

Industries such as healthcare, insurance, banking as well as real estate, would benefit highly from adopting this technology since they are built on rules, algorithms as well as high terms of engagement.