Unless you’ve been on a multi-year mission in space, you have heard of Bitcoin. Maybe you used it to buy a pizza or book a flight to Mars. The controversy around Bitcoin seems to have increased every year since its inception in 2008. Nonetheless, Bitcoin is accepted almost everywhere Millennials like to shop, and it operates as a surprisingly stable virtual currency.
It’s now common knowledge that the architecture on which Bitcoin operates is called Blockchain. If you’re an IT leader in a financial services company, there’s a good chance you have heard the term and may even know what it means for your industry. If you’re in a related area like insurance or supply chain distribution, you may still be trying to figure out what it means for you. Those in industries like retail, logistics, education, and media may not have heard of Blockchain or its potential benefits.
The hype around Blockchain started with first successful cryptocurrency: Bitcoin. Once technologists looked at the decentralization, cryptography, and sustainability principles at the core of Blockchain, they realized it could solve challenges inside the financial industry and otherwise:
- High transaction costs due to intermediaries
- High governance costs due to regulatory and auditory compliance requirements
- Slow transaction speeds due to multi-party checks and approval
- Risk of fraud due to immutability or non-transparency of information
If you think any of these problems are present in your business, chances are, your industry has the potential of being “Blockchained.”
A word of caution before you move too far with a Blockchain strategy: be careful not to create a question just to get a Blockchain answer. Not every decentralized distributed ledger system needs Blockchain. Sometimes, these problems can be solved more efficiently with existing technology, and sometimes they can be helped with a few adjustments based on Blockchain architecture. For example, Blockchain is quite effective as an adjacent “shadow” system focusing on one or two processes within the business ecosystem.
Regardless of the industry you’re in, if you are a digital transformation leader, you should know:
- What Blockchain means for your industry
- What Blockchain strategies have been proven for your industry
- Where Blockchain should be on the list of priorities of your innovation and strategy teams
I’ll address these questions in upcoming posts, so make sure to block out some time to read them.
Post Date: 29/08/2016