Blockchain is starting to make its mark throughout the entire source-to-pay process, from preventing risk in invoices, POs and contracts to tracking products in the supply chain and automating operational processes. Due to recent macroeconomic events and inflation, three increasingly important themes in supply chain networks are sustainability, risk prevention and agility. As businesses look to methods that can help them achieve a supply chain model that encompasses all three characteristics, blockchain has become one of the most prevalent new technologies that provide a solution. However, as the technology ages and pushes past its initial hype phase, organizations are becoming more aware of the risks of blockchain such as energy concerns, hackability, lack of federal regulations, lack of educational information, data access issues and more.
Blockchain, like any new technology, has the potential to be extremely useful to companies if applied in the right way. In this PRO subscription series, the Spend Matters analyst team will explore how blockchain technology can be used in the procurement process. Additionally, we will examine current use cases, theoretical use cases and some challenges related to implementing blockchain technology for the first time or in a new way (and how those challenges may be mitigated).
Our series will consist of 4 parts.
Part 1: What is a blockchain and why should you care?
In the first article in this series, we will explore:
- What a blockchain is and how it functions
- The technical areas and capabilities of blockchain in procurement, and why they should matter to procurement professionals:
- Traceability and visibility
- Decentralized Autonomous Organizations (DAOs)
- Document tracking and management
- Smart contracts
Part 2: Blockchain use cases in procurement: Current use cases
The second article in this series will explore the following companies that are currently using blockchain technology in the procurement process:
- Smart Contracts/CLM
- Visibility, traceability and document tracking
- GreenToken by SAP
- Digital Identities
Part 3: Blockchain use cases in Procurement: Theoretical and roadmap use cases
The third article in this series will explore theoretical use cases for blockchain in procurement; these may be entirely theoretical or in the planning and proof-of-concept stage:
- Collaboration platforms
- ESG factors
- NFTs in business
Part 4: Concerns and impediments and how to prevent them
The fourth article in this series will serve to share some common pitfalls and concerns that come with implementing blockchain, and will help companies make a plan for how to prevent them:
- Hackers and scammers
- Human error
- Lack of federal regulations, developing legal recognition, etc.
- ESG concerns
You can read part 1 now. Look out for parts 2, 3 and 4 in the coming days.