As a foundation for distributed ledgers, blockchain is an innovative technology in the current era that is packed with a wide range of use cases. Despite its initial speculations and concerns, industries are starting to adopt blockchain to leverage the technology’s transparency and underlying security.
Companies
that deal with finance, legal services, design; basically, any businesses that
deal with a large volume of transactions on a day-to-day basis are gradually
investing in blockchain technology. Today, manufacturing firms use blockchain’s
potential benefits to support their global supply chain network.
Scope of Blockchain in the manufacturing
industry
The manufacturing
sector has emerged as the new frontier for distributed ledger technology.
Across the
industry, many innovation-driven companies see a vast potential for improvement
in various processes with blockchain development. 49% of these companies believe that
blockchain can help ensure better compliance with current and future
regulations, 31% state that blockchain can enable better product sales in new
markets and 28% think that blockchain can reduce the risk of product recalls.
Whether it
is suppliers, procurement, sourcing, shop floor operations, or anything related
to manufacturing, blockchain offers a completely new way of doing things and
has the potential to emerge as a disruptive solution to various functions in
manufacturing. With the increasing adoption of blockchain in manufacturing,
experts predict that the use of blockchain in the manufacturing market is
expected to register a CAGR of approximately 78%.
Early Stages of Adapting Blockchain
Large-scale
manufacturing and supply chain is one of the most complex processes to
understand from an end-customer perspective. With billions of new products
being manufactured, processed, shipped, and delivered daily, there are a ton of
intermediaries that come into the picture, such as retailers, distributors,
logistics providers, storage facilities, and so on.
With that in
mind, companies adopted blockchain at different levels of their manufacturing
process to keep track of every change and provide a layer of transparency to
upper management & customers.
Blockchain in Manufacturing – Use
Cases
·
Supply chain
tracking and tracing
For manufacturers,
ensuring superior traceability is paramount as it affects product recall,
compliance, customer experience, and most importantly, distribution. By
employing IoT and blockchain together, manufacturers can streamline how they
aggregate, store and share data with partners across the supply chain.
·
Warranty
management
Seamless warranty
management is not just essential for the manufacturer to prevent fraud and
minimize costs, but also critical for delivering an impressive customer
experience. From false claims and fake products to misunderstandings about
coverage, there are myriad challenges faced by companies. By bridging the
information gap between manufacturers, warranty providers, other participants
in the supply chain, and the consumers, blockchain helps streamline the
warranty lifecycle.
· Better Payment Process:
Since multiple parties are involved in verifying and releasing payments, manufacturers often face delayed payments in addition to the lack of transparency in the payment process. The payment gets stuck at various stages in the supply chain. Smart contract functionality of Blockchain automates the payment process and ensures quicker and guaranteed payment to the suppliers.
· Improved data security
Communicating information such as invoices and contract details in any supply chain can be very risky using traditional methods. This is where Blockchain helps to keep the information secure with the best cryptography techniques. Since information blocks are nothing but chronologically stored copies of documents that are linked to the previous block, the chances of information getting hacked are eliminated.
Conclusion
Blockchain
in manufacturing is no longer a new concept since it is already being used to
make our day-to-day consuming products. Understanding the technology’s
importance and its long-term susceptibility, not only manufacturers but most of
the companies, large-scale industries with a decently funded R&D department
are continuously looking for ways to adopt blockchain into their operations.
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