Matthias Tauber, Partner & Managing Director, BCG
Blockchain: Making it real
BCG presentation at the TCG Summit will explore lessons learned for successful implementation
Matthias Tauber, Partner & Managing Director, BCG, will speak on the subject of Blockchain at the TCG Summit. We asked him for his thoughts on this technology.
THE BLOCKCHAIN CAN IMPROVE TRANSPARENCY, SPEED, AND RESPONSIVENESS OF COMPLEX SUPPLY CHAIN NETWORKS
Many digital technologies hold promise for manufacturers and retailers alike. The challenge is knowing which technologies to invest in, when, and how. Case in point: blockchain.
More than US$2 bn in venture capital investments fuelled blockchain technology’s advancements in 2018. In order to understand where blockchain’s value lies, it is essential to grasp its nature.
Relevant use cases in retail include E2E status tracking (for quality assurance over the complete supply chain) or full transparency about goods provenance (e.g. ethical/sustainable sourcing). The importance of the latter becomes evident when you consider the case of a recent crisis at Walmart: After an E.coli outbreak earlier this year, a blockchain solution enabled Walmart to trace back infected papayas within 2.2 seconds instead of seven days, as was previously the case.
How does blockchain technology increase efficiencies along the supply chain?
The blockchain can improve transparency, speed, and responsiveness of complex supply chain networks that typically suffer from siloed data, error, and fraud by several means:
- Time-stamping, recording, and automating transactions, so that events can be audited easily and for eternity;
- Minimising the involvement of intermediaries (e.g., bankers, insurers, brokers);
- Setting up a wide range of self-executing contracts to automate repetitive processes (e.g., billing and shipping); and
- Establishing proof of quality, provenance, payments, and performance to minimize counterfeiting and fraud.
Can you tell us a little about the real case study in the diamond industry that you will present at the TCG Summit?
Most discussions around blockchain are still rather theoretical and hardly any use cases have yet been implemented at scale. One example where there are live pilots under implementation is Tracr, a blockchain-enabled platform to trace diamonds all the way from mine to finger. The blockchain-based platform captures the physical properties of the assets as well as related data points across the whole diamond journey as “digital assets” on the blockchain. The platform has been designed to become industry-spanning, delivering value to all ecosystem participants while focusing on the end consumer. Through end-to-end tracking, this blockchain use case targets goods provenance, providing assurance that the diamond is natural and ethically sourced.
What is the connection between the diamond industry and the TCG sector?
The two industries face comparable challenges. For example, both the diamond industry as well as the TCG sector are characterised by complex supply chain networks of high-value items: E2E tracking offers significant possibilities for optimisation in both industries.