When you think of blockchain, you think of Bitcoin and other cryptocurrencies. You think of the end of banking as we know it. But for leaders who have an open mind to it, the technology is also revolutionizing our world in almost every industry thinkable.
Blockchain provides the ability to decentralize transactions while increasing security, and it seems as if there are new applications to the technology popping up every day -- some related directly to cryptocurrency and some enhancing innovative solutions in creative industries. Other applications of blockchain are having greater social and environmental impact.
I have always been leery of the hype with Bitcoin and other cryptocurrencies. The speculation and puffery were more than I could handle at times. However, I can see that the emerging value of the underlying technology, blockchain. At Adobe Summit in Vegas this year, I had the honor to interview Jessica Groopman, Founding Partner at Kaleido Insights, in their Think Tank series. We talked about all things blockchain and she best describes it this way: "At its highest level, blockchain is a trust layer."
Here is how you can look at blockchain within your industry:
Identify the areas needed for transparency.
If you sell a product, then you can likely see the buyer's desire for increased transparency. You must look at the market from the standpoint of the consumers. How concerned are the end users about the source of your products? Don't think about what is possible. Look for areas that can improve trust at all levels of the market.
For example: A consumer wants to buy gemstones, and yet they are concerned about the child labor of mining those stones. They may completely avoid making a purchase because they don't want to support any products without transparency of source.
I talked with Vik Pathak with Fura Gems about how they saw opportunity in gemstones. Pathak said they looked at the latent need for more transparency in the supply of emeralds and rubies. (De Beers is already using the blockchain in this way in diamond trading). From the point of the mining of the stone to the consumer's purchase, Fura will be able to track that stone using the blockchain ledger, helping to eradicate conflict mining and to help mitigate trading of fraudulent synthetic stones.
Can you define the need for transparency in your market? What do consumers want that is not currently available?
Assessment of the supply chain
When you look across the supply chain to all of the vendors, suppliers and even the logistics that bring your product to market, what do you see? If there is a volume of transactions before your product is made or it touches many different vendors, you are likely in a good position for leveraging blockchain.
Also if your product includes raw products that need to be traced back to the original source, the blockchain ledger could be a great way to improve trust.
In the world of art, there has been an unmet need with knowing with certainty who the original artist is for a piece. But thanks to blockchain technology and applications developed by All Public Art and founder Graham Goddard, artwork can now be authenticated and the sales history transparently tracked by using the power of blockchain as a regulatory function.
Who is in the supply chain for your products? It will take 100% participation with all vendors and logistics partners to be committed to more transparency.
Identify possible barriers with the technology
Clarify all the potential roadblocks with blockchain. It may be in the supply chain or in the tracking of raw materials. Or it may be in the energy required to run the technology.
For example, by 2020, it will take three times the world's current electrical output to sustain Bitcoin infrastructure alone -- and that's only one type of cryptocurrency. Bitcoin mining centers are powered by electric generators fueled by non-renewable resources. To address this issue, Larry King, Canadian natural resource mogul Stan Bharti and others have seen the need to invest in the world's first green energy investment platform. GEAR, which stands for green energy and renewable, uses cryptocurrency to finance large-scale clean energy operations working with green energy farms using solar, wind, tidal and biomass energy alternatives.
When you are considering blockchain in your industry, brainstorm on possible areas that will disrupt the adoption of the technology. It is better to understand these in advance and be prepared than to ignore the potential challenges.
When considering any new technology, you want to consider all possible barriers to user adoption. You also want to understand the value proposition of the strategy so that you are creating a relevant offer. This means you want to find drivers that can be leveraged with consumers that will fuel the growth of blockchain in your industry.