Abstract
The benefits of blockchain technology for supply chain management and logistics have been authenticated in recent years. It can support transparency and guarantee eventual, system-wide consensus on the validity of an entire history of transactions. As Conte de Leon et al. defined, blockchains would cause disrupting transformations in all types of industries when used in supply chain management. Logistic companies should engage in blockchain technology to adapt rapidly to changing market conditions and needs in today's dynamic business environment. Thus, this chapter provides a comprehensive overview of blockchain technology and focuses on crucial supply chain capabilities to create such transparency, flexibility, and mutual trust between supply chain partners.
TopIntroduction
Nakamoto revealed blockchain technology possibilities in the summer of 2008. A bitcoin network transaction between stakeholders has been concluded by Nakamoto (Song et al., 2019). Blockchain is not confined to capital and cryptocurrency markets. Blockchain technology offers various applications, including smart contracts, security in the network, and privacy. Blockchain is a distributed database that keeps constantly expanding lists of files called “blocks.” Every transaction will place in a different block, and each block in the chain is added. The total procedure resulted in the name “Blockchain”.(Saberi et al., 2019)(Bai & Sarkis, 2020). Blockchain technology first rose to prominence as a framework for managing Bitcoin, a digital currency. In addition to digital currency, Blockchain can be seen as the creative paradigm in computer science and data flows. As a result, it has far-reaching consequences for supply chain management and logistics in the future(Tian, 2017). By offering reliable data about shared items using a public Blockchain, this technology can assure data security, reliability, traceability, and authenticity, increasing confidence between supply chain actors and end consumers.
Nowadays, the supply chain is a critical sector for businesses that deal with the goods transport between parties. However, the difficulty with the supply chain and logistics industry is that its size can cause delays and defaults in supplying goods, among other problems, especially in developing countries. Furthermore, significant distributors require a large number of personnel to satisfy all of the demands of retailers. All of these may cause significant delays in order processing and increase the likelihood of orders being lost. (T. Li et al., 2016)To solve this problem, companies have automated all their processes, contributing to a considerable increase in the number of businesses and distributors in the supply chain. (Kopyto et al., 2020) However, as the volume of digital data grows and Internet firms expand, the likelihood of assaults on their databases grows as well. Hackers may seek to alter, steal, or destroy data. (Hopkins, 2021)
The benefits of Blockchain technology for supply chain management and logistics have been researched for quite some time. This research has recommended using Blockchain technology to manage firms' supply chains in agricultural, manufacturing, pharmaceutical, e-commerce, retail, and many other industries with effective logistics operations. This technology potentially benefits numerous supply chain concerns such as establishing secure relationships, sustaining trust amongst partners, quicker payment processing with cheaper transaction expenses, lower merchandises prices, shorter delivery times, improved forecasting, fewer bottlenecks, and resource-saving with recycling. Using Blockchain technology may help enhance the customer's trust and guarantee confidence in the entire supply chain. (Casado-Vara et al., 2018)
Meanwhile, according to Tapscott and Tapscott (2016), Blockchain technology can create transparency and serve as a single source of truth to the whole network of supply chain players. All of the blocks in a Blockchain are cryptographically linked, which removes the potential of data tampering. (Tapscott & Tapscott, 2016)
Key Terms in this Chapter
Logistics: Logistics is the whole process of managing resource acquisition, storage and transportation to the final destination.
Trust: Connectivity and vulnerabilities must be found and examined to reduce the likelihood of damage to trust in the supply chain. Many variables drive Blockchain technology in the supply chain for information exchange, but trust is one of the essential developments.
Supply Chain Flexibility: Supply chain flexibility has grown from well-established beginnings in manufacturing flexibility studies. It can extend the notion of change without trade-offs from the individual company to the supply chain to sustain competitiveness in an increasingly complicated economic environment.
Blockchain: Blockchain technology is a shared and unchangeable ledger for recording and tracking transactions in a corporate network. An asset may be material or intangible (household, car, cash, land, IPU, patents, copyrights, branding).
Logistics Management: Logistics management includes identifying and determining the efficiency and accessibility of future distributors and suppliers. Logistics managers are known as logisticians.
Supply Chain Transparency: The technique of releasing complete and accurate data about operations and goods, such as their sourcing and origin, manufacturing methods and logistics, is known as supply chain transparency.
Supply Chain Management: Supply chain management can be defined as integrating key business processes from end-user through original suppliers that provide products, services, and information that add value for the customer and other stakeholders.