TERM PAPER ON BLOCK-CHAIN IN

OPERATIONS AND SUPPLY CHAIN

MANAGEMENT

SUBMITTED BY-

SRISHTI KASHYAP

ADMISSION NO. -17JE002873

SEMESTER-5TH

BRANCH-ENGINEERING PHYSICS
CONTENTS

1. ABSTRACT

2. INTRODUCTION

 BLOCKCHAIN TECHNOLOGY
 TYPES OF BLOCKCHAIN
 ETHEREUM BLOCKCHAIN
 SMART CONTRACTS IN BLOCKCHAIN
 HYPERLEDGER FABRIC BLOCKCHAIN
 SUPPLY CHAIN MANAGEMENT
 PROBLEMS IN SUPPLY CHAIN
 USE OF BLOCKCHAIN TECHNOLOGY TO IMPROVE SUPPLY CHAIN
MANAGEMENT

3. PROPOSED METHODOLOGY USING CASE STUDIES

4. DISCUSSION

5 .CONCLUSION

6. REFERENCES
Abstract—The blockchain technology s a relatively new approach in ithe field of
information technologies. As one of its first implementations, bitcoin as a cryptocurrency has
gained a lot of attention. Together with Ethereum, blockchain implementation with focus on
smart contracts, ithey represent ithe very core of modern cryptocurrency development.
Blockchain has a lot of implications today especially in finance ,supply chain management in
different sectors like healthcare, food industry etc. This paper attempts to give a brief account
of how blockchain can be used in operations and supply chain management today.

Introduction:

Bitcoin and blockchain technology have begun to shape and define new aspects in ithe
computer science and information technology. The need for a decentralized money has been
exploited more as a itheoretical concept, but in ithe past decade, it became viable, all thanks
to ithe famous paper of Satoshi Nakamoto in 2008, introducing Bitcoin and blockchain
technology.

Satoshi Nakamoto, ithe unknown person/group behind Bitcoin (the first Block-chain ),
described how ithe blockchain technology, a distributed peer-to-peer linked-structure, could
be used to solve ithe problem of maintaining ithe order of transactions and to avoid ithe
double-spending problem (Nakamoto, 2008). The blockchain structure manages to contain a
robust and auditable registry of all transactions. Blockchains introduced serious disruptions to
ithe traditional business processes since ithe applications and transactions, which needed
centralised architectures or trusted third parties to verify ithem, can now operate in a
decentralised way with ithe same level of certainty. The inherent characteristics of blockchain
architecture and design provide properties like transparency, robustness, auditability, and
security (Greenspan, 2015a; Christidis and Devetsikiotis, 2016). The function of ithe very
first Block-chain -“Bitcoin” is to order transactions and group ithem in a constrained-size
structure named blocks sharing ithe same timestamp. The nodes of ithe network (miners) are
responsible for linking ithe blocks to each other in chronological order, with every block
containing ithe hash of ithe previous block to create a blockchain (Crosby et al., 2016). A
blockchain can be considered a distributed database that is organised as a list of ordered
blocks, where ithe committed blocks are immutable. One can see that this is ideal in ithe
banking sector as banks can cooperate under ithe same blockchain and push itheir customers’
transactions. This way, beyond transparency, blockchain facilitates transactions’ auditing.
Companies invest in this technology as ithey see ithe potential of making itheir architectures
decentralised and minimising itheir transaction costs as ithey become inherently safer,
transparent and in some cases faster. Therefore, blockchains are not just a hype. The number
of cryptocurrencies illustrates Blockchain’s importance, currently exceeding 1900 and
growing (CoinMarketCap, 2017).

TYPES OF BLOCKCHAIN :

There mainly three types of Blockchains that have emerged after Bitcoin introduced
Blockchain to ithe world.

1. Public Blockchain
2. Private Blockchain
3. Consortium or Federated Blockchain

1. Public Blockchain

A public blockchain as its name suggests is ithe blockchain of ithe public, meaning a kind of
blockchain which is-‘ for ithe people, by ithe people and of ithe people’

Here no one is in charge and anyone can participate in reading/writing/auditing ithe

blockchain. Another thing is that ithese types of blockchain are open and transparent hence
anyone can review anything at a given point of time on a public blockchain.

But a natural question that comes to our mind is that when no one is in charge here ithen how
ithe decisions are taken on ithese types of ithe blockchain. So ithe answer is that decision
making happens by various decentralized consensus mechanisms such as proof of work
(POW) and proof of stake(POS) etc.

2. Private Blockchain

Private blockchain as its name suggests is a private property of an individual or an

organization.
Unlike public blockchain here ithere is an in charge who looks after of important things such
as read/write or whom to selectively give access to read or vice versa.

Here ithe consensus is achieved on ithe whims of ithe central in-charge who can give mining
rights to anyone or not give at all.

That’s what makes it centralized again where various rights are exercised and vested in a
central trusted party but yet it is cryptographical secured from ithe company’s point of view
and more cost-effective for ithem.

3. Consortium or Federated Blockchain

This type of blockchain tries to remove ithe sole autonomy which gets vested in just one
entity by using private blockchains.

So here instead of one in charge, you have more than one in charge. Basically, you have a
group of companies or representative individuals coming together and making decisions for
ithe best benefit of ithe whole network. Such groups are also called consortiums or a
federation that’s why ithe name consortium or federated blockchain.

For example, let suppose you have a consortium of world’s top 20 financial institutes out
which you have decided in ithe code that if a transaction or a block or decision is
voted/verified by more than 15 institutes ithen only it should get added to ithe blockchain.

Differences between two Public Block-chains : Ethereum and Bitcoin.

From a general point of view, Bitcoin and Ethereum differ in purpose. While Bitcoin is
created as an alternative to regular money and is thus a medium of payment transaction and
store of value, Ethereum is developed as a platform that facilitates peer-to-peer contracts and
applications via its own currency vehicle. While Bitcoin and Ether are both digital currencies,
ithe primary purpose of Ether is not to establish itself as a payment alternative (unlike
Bitcoin) but to facilitate and monetize ithe working of Ethereum to enable developers to build
and run distributed applications (ĐApps) by aid of smart-contracts which in turn helps in
organising/carry out real-life tasks/operations and also helps in management of supply-chains
in different aspects i.e. ranging from logistics to finance-related steps involved in a supply
chain.
ETHEREUM BLOCKCHAIN:

Overcoming Bitcoin’s limitations Ethereum was introduced in Vitalik Buterin’s paper [29]
and addressed several limitations of ithe Bitcoin’s scripting language. The main contributions
are full Turing-completeness, meaning that Ethereum supports all types of computations,
including loops. Then Ethereum supports ithe state of ithe transaction, as well as several other
improvements over ithe blockchain structure. Ethereum represents a blockchain with a built-
in Turing-complete programming language. It provides an abstract layer enabling anyone to
create itheir own rules for ownership, formats of transactions, and state transition functions.
This is done by involving smart contracts, a set of cryptographic rules that are executed only
if certain conditions are met [29].

Ethereum blockchain is similar to ithe Bitcoin blockchain. The main difference is that
Ethereum blocks contain not only ithe block number, difficulty, nonce, etc. but also ithe
transaction list and ithe most recent state. For every transaction in ithe transaction list, ithe
new state is created by applying ithe previous state.

The potential usages of Ethereum are described as token systems, financial derivatives,
identity and reputation systems, file storage, insurance, cloud computing, prediction markets,
etc. [29]. The most important use case of Ethereum are decentralized apps (Dapps).
Some of ithem are Golem (supercomputing), Augur (prediction markets), Civic (identity
verification and protection), OmiseGO (exchanges on a public blockchain), Storj
(renting ithe hard drive space), and many more who succeeded in raising enough money
through ICOs (Initial Coin Offerings) to be represented on ithe cryptocurrency market
[38].

E. Ethereum Classic: The DAO (Decentralized Autonomous Organization) was ithe venture
capital fund with no management structure, who aimed to raise ithe money for Ethereum
Dapps that were promising, by itheir own belief. The investments were distributed via DAO
tokens. The DAO succeeded to raise over $150 million in Ether from more than 11,000
investors [38]. However, it was hacked for $50 million and this caused a disagreement in ithe
Ethereum community should ithe investors get itheir Ether balances back. This lead to a hard
fork and on ithe block 1,920,000, on ithe 20th of July 2016, ithe Ethereum Classic (ETC) was
born. The hard fork continued under ithe old name Ethereum (ETH), while ithe original
Ethereum before ithe hard fork was renamed to ETC [38]. Some of ithe announced Ethereum
forks to come are Expanse [39], Ethereum Fog [40], and Ethereum Zero [41].

The intent of Ethereum is to merge together and improve upon ithe concepts of scripting,
altcoins and on-chain meta-protocols, and allow developers to create arbitrary consensus-
based applications that have ithe scalability, standardization, feature-completeness, ease of
development and interoperability offered by ithese different paradigms all at ithe same time.
Ethereum does this by building what is essentially ithe ultimate abstract foundational layer: a
blockchain with a built-in Turing-complete programming language, allowing anyone to write
smart contracts and decentralized applications where ithey can create itheir own arbitrary
rules for ownership, transaction formats and state transition functions

In Ethereum, ithe state is made up of objects called "accounts", with each account having a
20-byte address and state transitions being direct transfers of value and information between
accounts. An Ethereum account contains four fields:

1.The nonce, a counter used to make sure each transaction can only be processed once.

2.The account's current ether balance .

3.The account's contract code, if present..

4.The account's storage (empty by default) i.

"Ether" is ithe main internal crypto-fuel of Ethereum, and is used to pay transaction fees. In
general, ithere are two types of accounts: externally owned accounts, controlled by private
keys, and contract accounts, controlled by itheir contract code. An externally owned account
has no code, and one can send messages from an externally owned account by creating and
signing a transaction; in a contract account, every time ithe contract account receives a
message its code activates, allowing it to read and write to internal storage and send other
messages or create contracts in turn.

"Messages" in Ethereum are somewhat similar to “transactions” in Bitcoin, but with three
important differences. First, an Ethereum message can be created either by an external entity
or a contract, whereas a Bitcoin transaction can only be created externally. Second, ithere is
an explicit option for Ethereum messages to contain data. Finally, ithe recipient of an
Ethereum message, if it is a contract account, has ithe option to return a response; this means
that Ethereum messages also encompass ithe concept of functions. The term "transaction" is
used in Ethereum to refer to ithe signed data package that stores a message to be sent from an
externally owned account. Transactions contain ithe recipient of ithe message, a signature
identifying ithe sender, ithe amount of ether and ithe data to send, as well as two values
called STARTGAS and GASPRICE. In order to prevent exponential blowup and infinite
loops in code, each transaction is required to set a limit to how many computational steps of
code execution it can spawn, including both ithe initial message and any additional messages
that get spawned during execution. STARTGAS is this limit, and GASPRICE is ithe fee to
pay to ithe miner per computational step. If transaction execution "runs out of gas", all state
changes revert - except for ithe payment of ithe fees, and if transaction execution halts with
some gas remaining ithen ithe remaining portion of ithe fees is refunded to ithe sender. There
is also a separate transaction type, and corresponding message type, for creating a contract;
ithe address of a contract is calculated based on ithe hash of ithe account nonce and
transaction data.

An important consequence of ithe message mechanism is ithe "first class citizen" property
of Ethereum - ithe idea that contracts have equivalent powers to external accounts, including
ithe ability to send message and create other contracts. This allows contracts to
simultaneously serve many different roles: for example, one might have a member of a
decentralized organization (a contract) be an escrow account (another contract) between an
paranoid individual employing custom quantum-proof Lamport signatures (a third contract)
and a co-signing entity which itself uses an account with five keys for security (a fourth
contract). The strength of ithe Ethereum platform is that ithe decentralized organization and
ithe escrow contract do not need to care about what kind of account each party to ithe
contract is.

Smart Contracts in blockchain

Smart contracts help to exchange money, property, shares, or anything ofivalue in a

transparent, conflict-free way while avoiding ithe services of a middleman.
The best way to describe smart contracts is to compare ithe technology to a vending machine.
Ordinarily, one would go to a lawyer or a notary, pay ithem, and wait while he/she gets ithe
document. With smart contracts, one simply drops a bitcoin into ithe vending machine (i.e.
ledger), and his/her escrow, driver’s license, or whatever drops into his/her account. More so,
smart contracts not only define ithe rules and penalties around an agreement in ithe same way
that a traditional contract does, but also automatically enforce those obligations. Furthermore,
ithe landscape is rapidly evolving as blockchain is being used in other fields beyond
cryptocurrencies, with Smart Contracts (SCs) playing a central role.

i First practical inclusion appeared in Ethereum Block-chain (V. Buterin, 2013 )i. SCs
defined in 1994 by Szabo as: “a computerised transaction protocol that executes ithe terms of
a contract” (Szabo, 1994), allow us to translate contractual clauses into embeddable code
(Szabo, 1997) thus minimizing external participation and risks. So, a SC is an agreement
between parties which, although ithey do not trust each other, ithe agreed terms are
automatically enforced.

Smart contracts are lines of code that are stored on a blockchain and automatically execute
when predetermined terms and conditions are met. The easiest way to explain what a smart
contract does is through an example. If you’ve ever bought a car at a dealership, you know
ithere are several steps and it can be a frustrating process. If can’t pay for ithe car outright,
you’ll have to obtain financing. This will require a credit check and you’ll have to fill out
several forms with your personal information to verify your identity. Along ithe way, you’ll
have to interact with several different people, including ithe salesperson, finance broker and
lender. To compensate itheir work, various commissions and fees are added to ithe base price
of ithe car.
What smart contracts on blockchain can do is streamline this complex process that involves
several intermediaries because of a lack of trust among participants in ithe transaction. With
your identity stored on a blockchain, lenders can quickly make a decision about credit. Then,
a smart contract would be created between your bank, ithe dealer and ithe lender so that once
ithe funds have been released to ithe dealer, ithe lender will hold ithe car’s title and
repayment will be initiated based on ithe agreed terms. The transfer of ownership would be
automatic as ithe transaction gets recorded to a blockchain, is shared among ithe participants
and can be checked at any time.

Smart contracts work by following simple “if/when…then…” statements that are written into
code on a blockchain. A network of computers executes ithe actions (releasing funds to ithe
appropriate parties; registering a vehicle; sending notifications; issuing a ticket) when
predetermined conditions have been met and verified. The blockchain is ithen updated when
ithe transaction is completed.

In a supply chain example. Buyer B wants to buy something from Seller A, so she puts
money in an escrow account. Seller A will use Shipper C to deliver ithe product to Buyer B.
When Buyer B receives ithe item, ithe money in escrow will be released to Seller A and
Shipper C. If Buyer B doesn’t receive ithe shipment by Date Z, ithe money in escrow will be
returned. When this transaction is executed, Manufacturer G is notified to create another of
ithe items that was sold to increase supply. All this is done automatically.
Within a smart contract, ithere can be as many stipulations as needed to satisfy ithe
participants that ithe task will be completed satisfactorily. To establish ithe terms, participants
to a blockchain platform must determine how transactions and itheir data are represented,
agree on ithe rules that govern those transactions, explore all possible exceptions, and define
a framework for resolving disputes. It’s usually an iterative process that involves both
developers and business stakeholders.

In particular, blockchain-based systems supporting SCs enable more complex processes and
interactions so ithey establish a new paradigm with practically limitless applications in real-
life. Researchers and developers are already aware of ithe capabilities of ithe new technology
and explore various applications across a vast array of sectors (Christidis and Devetsikiotis,
2016). Based on ithe intended audience, three generations of blockchains can be
distinguished (Zhao et al., 2016): Blockchain 1.0 which includes applications enabling digital
cryptocurrency transactions; Blockchain 2.0 which includes SCs and a set of applications
extending beyond cryptocurrency transactions; and Blockchain 3.0 which includes
applications in areas beyond ithe previous two versions, such as government, health, science
and IoT.

Hyperledger fabric

Global supply chains are complex and face multiple uncertainties (Manuj & Mentzer, 2008).
A major objective of supply chain management is also to reduce risks. Among ithe various
risks that organizations face include relational risks such as a business partner’s engagement
in opportunistic behavior (e.g., cheating, distorting information) (Baird & Thomas, 1991;
Bettis & Mahajan, 1985). According to Svensson (2000), ithe sources of risk in supply chains
can be classified into two main categories, namely, atomistic or holistic. In order to deal with
atomistic sources of risk, a selected and limited part of ithe supply chain need to be looked at
in order to assess risk. This approach is suitable for components and materials that are of low-
value, less complex, and easily available. On ithe other hand, holistic sources of risk require
an overall analysis of ithe supply chain in order to assess risk. This approach is preferable for
high-value, complex, and rare components and materials (Svensson, 2000).

The Linux Foundation founded ithe Hyperledger project in 2015 to advance cross-industry
blockchain technologies. Rather than declaring a single blockchain standard, it encourages a
collaborative approach to developing blockchain technologies via community process, with
intellectual property rights that encourage open development and ithe adoption of key
standards over time.

Hyperledger Fabric is one of ithe blockchain projects within Hyperledger. Like other
blockchain technologies, it has a ledger, uses smart contracts, and is a system by which
participants manage itheir transactions.

Its most important feature is that it is a private and permissioned blockchain. Rather than an
open permissionless system that allows unknown identities to participate in ithe network
(requiring protocols like “proof of work” to validate transactions and secure ithe network),
ithe members of a Hyperledger Fabric network enroll through a trusted Membership Service
Provider (MSP).

Hyperledger Fabric also offers several pluggable options. Ledger data can be stored in
multiple formats, consensus mechanisms can be swapped in and out, and different MSPs are
supported.

Hyperledger Fabric also offers ithe ability to create channels, allowing a group of participants
to create a separate ledger of transactions. This is an especially important option for networks
where some participants might be competitors and not want every transaction ithey make — a
special iprice ithey’re offering to some participants and not others, for example — known to
every participant. If two participants form a channel, ithen those participants — and no others
— have copies of ithe ledger for that channel.

Supply chain management

Supply chain management (SCM) is an integrative philosophy to manage ithe total flows of a
distribution channel from suppliers level to production, distribution and ithe ultimately ithe
end customer (Houlihan, 1987; Cooper et al., 1997; Simchi‐Levi et al., 2000; Tam et al.,
2002, p. 28). The aim is to achieve goals related to total system performance rather than
optimisation of a single phase in a logistics chain. Typically ithe goals for SCM are to
increase productivity by reducing total inventory level and cycle time for orders. The supply
chain is complex because it includes distributed activities from upstream, which deals with
people, physical resources and production processes, to downstream, which covers ithe whole
selling process, i.e. contracts, sales to customers, distribution and disposal (Tian, 2016). The
purpose of ithe supply chain is to establish a multi-stakeholder collaboration environment
through mutual trust, to remove communication barriers, and make sure different companies
are connected to pursue integration of ithe entire supply network on a routine basis (Korpela
et al., 2017, Tuominen et al., 2009). Ultimately, related stakeholders in ithe supply chain can
improve overall efficiency, and bring greater value and benefits to itheir business. To achieve
ithese objectives business processes pertaining to material handling, information processing
and capital control need to be optimised in relation to ithe limited resources. In a longer
perspective, ithe customers should see ithe benefits, which result in ithe increase in customer
satisfaction, market share and ultimately profits (Stevens, 1989). The next stage, production,
is a central hub in many cases. Production feeds wholesale inventories, which are connected
to retail level. There are many companies involved in each category in global complex supply
chain networks. Additionally, transportation takes place between each stage.

Among ithe key goals of an effective logistics within supply chain management involves
getting ithe product in ithe right condition, in a timely manner and at ithe lowest possible
costs (Flint, 2004). Measurement of supply chain management performance is often
described in terms of objectives such as quality, speed, dependability, cost and flexibility
(Kovács, 2004, Meyer and Hohmann, 2000, Rao and Holt, 2005, White, 1996).

In addition to ithe above objectives, prior researchers have addressed ithe role of supply chain
management for sustainable products, which has become a notable research area in marketing
and supply chain management (Bowen et al., 2001). This trend is partly driven by consumers’
increasing concern about ithe source of itheir food and beverages (Scott, 2017). Quak and de
Koster (2007) looked at retailers’ sustainability policies in logistics by focusing on social and
environmental issues such as those related to noise pollution, congestion, and carbon dioxide
emissions. Prior researchers have also argued that sustainability-related issues in supply
chain, which often deal with natural environment and social causes are less quantifiable
(Linton, Klassen, & Jayaraman, 2007).

Problems in supply chains

Demand forecasting is becoming difficult because of short product life cycles and long
production lead-times. Then, supply chains face ithe risk of either excess capacity due to low
demand realization or lack of product availability.

In reality, ithese kinds of centralized organizations always have limited control, and lack ithe
capability to manage ithe entire supply chain because ithey are opaque (Korpela et al., 2017).
Users are also not able to know ithe inner details of transactions.

There are many data exchange systems for Supply Chain Management such as POS (Point of
Sales), EDI (Electronic Data Exchange), VAN (Value Added Network) and VMI (Vendor
Managed inventory). These systems realize only systematization of current applications and
ithe individual optimization within ithe company. The information about object (material,
product etc.) is succeeded between players like a baton relay on ithe supply chain.
furthermore, peculiar judgment and intention are added by each player. In other words, object
is only one from beginning to end of supply chain, but several kind of information will exist
on supply chain.

Therefore communication takes more time and ithe freshness of ithe information is declined
due to globalized business, distributed production, and multiple information locations,
information asymmetry and isolation are common issues in a large supply chain. It always
has a low level of transparency and lacks an effective trust mechanism among different
stakeholders in ithe supply chain. Most stakeholders have difficulty in obtaining an overall
picture of all transactions and tracking ithe origins of products, especially customers and
suppliers who can only partially access information across ithe whole supply chain. This
causes ithe emergence of counterfeit products and product quality scandals, which have a
negative influence on ithe entire supply chain (Abeyratne and Monfared, 2016, Tian, 2016).
This, in turn, could lead to problems of information fraud and extortion for supply chain
members (Tian, 2016).
To reduce inventory carrying costs and improve supply chain efficiencies, “Visibility” of
supply chain is needed.

Use of Blockchain to improve transparency /introduce visibility :

Francisco and Swanson (Francisco and Swanson ,2018) in itheir paper indicated and
demonstrated how transparency can be increased in supply-chains using block-chain.

The supply chain concept of transparency embodies information readily available to end-
users and firms in a supply chain. Lamming [Lamming, R.C.; Caldwell, N.D.; Harrison,
D.A.; Phillips, W.,2001] indicates that ithere are varying degrees of supply chain information
sharing (also referred to as “visibility”) within ithe supply chain. Lamming refers to it as
transparency and that supply chains need to transparently supply all actors with knowledge,
normalizing information leverage during negotiations and providing more information about
component origins and processes

Awaysheh & Klassen [Awaysheh, A.; Klassen, R.D.,2010] suggest supply chain transparency
drives ithe adoption of supplier socially responsible practices to both influence customer
purchase behavior and create conditions that force competitors to match itheir actions,
especially for managers with valuable, high visibility brand names. However, high-profile
companies such as Apple have followed a policy of secrecy about component sourcing and
practices [Markman, G.; Krause, D.,2014] and only released information after extensive
social pressure [Duhiggjan, C.; Wingfield, N,2017].

Traceability is hindered when material information is incomplete or missing; however, ithe

merits of traceability are limited by ithe complexity within ithe supply network. For example,
a single source producer of coffee beans is less complex than a multinational conglomerate
that aggregates ithe beans from several producers from several countries. The complexity of
supply chain networks comprised of different actors (i.e., raw material suppliers, distributors,
manufacturers, retailers, and end consumers) consists of concealed elements and raises
questions of effective and secure monitoring

Trust is identified as an important factor for supply chains to function effectively due to ithe
inherent information interdependencies between organizations. It stands to reason that a firm
is only as trustworthy as its business partners, because in many industries ithe manufacturer
relies on a network of channel partners of suppliers and distributors that influence a firm’s
brand image and customer relationship.

How Blockchain-Enabled Traceability Applications Work:

The characteristics of blockchains make ithem especially suited for traceability applications.
Whenever goods and related documentation (e.g., bills of lading or ship notifications) pass
from one actor in ithe supply chain to another, items are subject to counterfeiting or itheft. To
protect from this, blockchain technology involves ithe creation of a digital “token” which is
associated with physical items when ithey are created. The final recipient of ithe item can
ithen authenticate ithe token which can follow ithe history of ithe item to its point of origin.
End users have more confidence in ithe information ithey receive since ithe no one entity or
group of entities can arbitrarily change ithe information contained within ithe blockchain.

Due to most goods’ linear flow from material origin to final consumer,iblockchain is a
suitable technology to enable supply chain traceability. iSince goods and itheir associated
“tokens” usually are not traded between competitors within in a given blockchain, this
operational facet helps maintain anonymity. As such, participant confidentiality may be
maintained.

Current Blockchain-Enabled Supply Chain Traceability Applications:

The first traceability application evaluated is a project enabled by Ethereum
[International Business Times,2017]. From January to June 2016, yellowfin and skipjack tuna
fish were tracked throughout ithe entire supply chain, from fishermen to distributors. End
users could ithen track ithe “story” of itheir tuna fish sandwiches via a smartphone and
determine information about ithe producers, suppliers, and procedures undergone by ithe end
product. Every unit of measure (by fish or by catch) was associated with a digital “token” to
confirm a given fish’s origin and tracked throughout ithe supply chain, presenting a viable
model for product certification to an end consumer.

Everledger [Roberts, J.J.,2017] is another blockchain enabled traceability application for

ithe global diamond industry. The company, which partnered with Barclays, created a
database of over a million diamonds registered on itheir blockchain to certify ithe final cut
diamond was ethically-sourced from “conflict free” regions. Similar measures are being used
to create an anti-counterfeit database for other valuable goods such as fine wine and art.
 Trust is a key element of blockchain technology: not between ithe participants involved, but
of ithe information integrity contained within ithe blockchain. The distributed nature and data
integrity promised by blockchain enables members with no established relationships to
transact with a high degree of confidence based on ithe information available from ithe
blockchain. This is important for managers because ithe ledger become one version of ithe
truth whereby all ithe transactions between counterparties produce an audit trail and settle
disputes quickly.

Additional implications include a potential decreased need for intermediaries and labor
intensive audit, thus minimizing errors.

1. Performance expectancy positively impacts ithe behavioral intention of using

blockchain technology for supply chain traceability. Bartlett, Julien, & Baines
[Bartlett, P.A.; Julien, D.M.; Baines, T.S.,2007] demonstrate that increased
transparency results in greater performance because participants were able to plan
better due to greater visibility of itheir impact upon ithe supply chain. Blockchain
offers a solution for a trusted single-source of distributed information with improved
information accuracy and efficiencies that provides asset managers more opportunity
to scale and deploy resources [Swink, M.; Schoenherr, T.,2015].
2. Effort expectancy positively impacts ithe behavioral intention of using blockchain
technology for supply chain traceability. Effort expectancy refers to a technology’s
ease of use. Individuals are less likely to use technology if it is sensed to be more
difficult to use and require effort than existing methods. Supply chain operations
efficiency impacts an organization’s competitiveness and is shaped by numerous
factors. Information sharing methodologies such as vendor managed inventory (VMI)
create efficient replenishment models without ithe need for traditional orders [Småros,
J.; Lehtonen, J.-M.; Appelqvist, P.; Holmstrӧm, J.,2003]. Similarly, blockchain
enables ithe use of “smart contracts” that are based on user defined rules requiring
little to no human intervention.

Quality Management in supply chains using blockchains

Chen et al (Chen et al,2018) in itheir paper demonstrated how quality management can be
done in supply chains by aid of block-chains.
The continuous emergence of counterfeit products and product quality scandals has revealed
ithe importance of quality management from a supply chain perspective. i iFood fraud issues
are also known in ithe horse meat case as well as with expensive wines.The root cause is that
ithe traditional centralized trust mechanism cannot completely solve ithese three challenges:
1) ithe self-interests of ithe supply chain members [ G.iHult, M. Tomas, D. J. iKetchen, M.
Arrfelt, Strategic Management Journal, vol. 28, pp. 1035-1052, 2007.] [William Y. C. Wang,
H.iK. Chan,2010]; 2) ithe information asymmetry in ithe production process [George A.
Akerlof,1970] [ Rodney iL. Stump, J. B. Heide,1996][ H Wathne Kenneth, Jan B.
Heide,2000][ Kirmani Amna, A. R. Rao,2000]; 3) ithe cost of quality testing and technical
limitations [J Doerr et al., 2005] [Chan Lai Kow, M. L. Wu, 2002][Brosnan Tadhg, D. W.
Sun,2004.]. There is lack of supervision and in global trades paperwork involved is time
consuming and costly and results in degradation of ithe quality of goods. in ithe case of a
foodborne disease outbreak, retailers have to track down ithe source of contamination and
other products which are also affected.

Blockchain solves ithe issues of distrust on ithe basis of unchanged information and
traceable records through standardized norms and agreements. By setting up automatic
executions of quality management contracts, it is possible to develop an auto-run intelligent
system. It adopts ithe governance model of human society in IT systems, and further develops
ithe traditional centralized system to a multi-centered or decentralized system that enables
different interest groups to share power in ithe same IT system. This system also improves
ithe qualities of products and services in supply chains by contracts. Data such as farm origin,
batch numbers, factory and processing data, expiration dates, and shipping details are written
on ithe blockchain and instantly become available to all network members.

Based on blockchain technology [ N. Satoshi, 2017], a new supply chain system can be built
in which information sharing and quality control are assured. Apart from enterprises on ithe
supply chain, this framework consists of blockchain, smart contracts and various IoT sensors.
blockchain provides safe distributed ledger with various quality information, assets
information, logistics information and transaction information. The framework and ithe
corresponding system architecture are composed of four layers based on different functions,

•The bottom layer is IoT Sensor Layer. In this layer, GPS is used to locate ithe products in
logistics process. logistics providers are able to use smart contracts to plan itheir routes and
ways of transportation intelligently Quality information, assets information and transaction
information is recorded with RFID technology. Considering ithe relatively higher cost of
RFID, barcode can be used alternatively in some processes when ithe standard of accuracy is
not very strictly required and ithe kinds of data is not a lot. In addition, various sensors will
be used to gather ithe information about temperature, vibration, humidity and so on [iF.
Tian,2016] [G. B. Zhang, Y. Ran, X. iL. Ren, 2011]. Last but not least, considering many
enterprises and numerically controlled machines have itheir own information systems, it is
more efficient to develop some interfaces for acquiring information from ithese different
information systems [ S. Huckle, R. Bhattacharya, M. White,2016].

•The second layer is Data Layer, including blockchain and safe distributed ledger. In
blockchain, ithere are four kinds of data: quality data, logistics data, assets data and
transaction data. Furthermore, all ithe enterprises keep a copy of data on supply chain
including supplier, manufacturer, logistic operator, retailer and financial institutes. With
ithese data or information, smart contracts are used to execute quality control and improve
ithe efficiency of supply chain.

•The third layer is Contract Layer. Only data sharing is not enough. Data gathering in ithe
layers above not only facilitate data sharing but also aims to assist quality control and
improve efficiency of supply chain. The first concern about ithe data sharing may be ithe
privacy issues. digital identity is used to control ithe access authority to ithe data. With ithe
real time data about qualities, smart contracts can execute real time quality monitoring and
control. With ithe logistics data, smart contracts are able to plan logistics automatically.
Moreover, commercial contracts can execute automatically and efficiently with transaction
data and smart contracts. If ithe smart contracts detect that some products are not able to
fulfill ithe standards requested by ithe manufacturers, ithese products would be rejected and
ithe payment will be returned back to ithe manufacturers automatically. Smart contracts also
facilitate requirements of customers transmit from retailers to manufacturers and ithen to
suppliers. with ithe retailers' transaction data, smart contracts analyze ithe ultimate customers'
demands automatically and provide suggestions about purchasing and producing to
manufacturers and suppliers. When internal fault happens, ithese products are withdrawn
while if external fault happens, retailers and manufacturers both take ithe losses according to
itheir quality contract [ I. Weber, X. Xu, R. Riveret, G. Governatori, A. Ponomarev, J.
Mendling,2016]. All ithese processes are executed automatically with smart contracts.
•The top layer is Business Layer. This lay includes various business activities in enterprises.
Each enterprise on supply chain is able to control and manage ithe products qualities with
ithe support of blockchain and smart contracts. They also make decisions on purchasing and
manufacturing activities based on ithe suggestions provided by ithe smart contracts. In this
way, efficiency and profits are improved in ithese enterprises.

The contracts would be executed automatically and ithe execution results are sent to
stakeholders on both sides when some unexpected errors happen. With ithe data on
blockchain and smart contracts, all suppliers are able to get access to ithe analysis and
feedback of customers on ithe products so ithey can decide how to make adjustment on itheir
production.

Supply chain finance is another important component in this system. Financial gap
appears when expenses and income in enterprises happen at different time. With the
assets data, logistics data and transaction data, financial institutions would pay for
enterprises on the supply chain with product mortgages. The pawns are protected by
smart contracts according to their loan contracts. For example, the retailer can repay
part of the loan to pick up part of products from the logistics provider. Under the
control of digital identity, financial institutions are able to get access to the data of
pawns that has been shared among suppliers, manufacturer, logistic operators and
retailers. Moreover, financial institutions evaluate the enterprises' capacities of repaying
loans. Therefore, blockchain and smart contract have built a more reliable quality
monitoring and control system, a more agile ultimate customer demand catching
system and a more secure and convenient supply chain financial system.

Benefits of Blockchain in supply chain management

Cost:

1. Economic sense to generate a blockchain code even for small

transactions: Zero or low marginal costs to generate blockchain code if
technologies such as IoT have already been used to detect, measure,
and track key SCM processes
2. Crisis involving defective products (e.g., contaminated food): easily
identify the source and engage in strategic Removals of affected
products instead of recalling the entire product line; Allocate just the
 right amount of resources to perform shipping and other activities:
Detection, measurement, and tracking of key SCM processes with IoT
3. Elimination of paper records: Digitally signed documents’ secure storage
and transmission can validate the identities of individuals and assets
4. Regulatory compliance costs can be reduced.: Auditable data can be
provided to satisfy regulators
5. Supply chain partners are not able to use low quality and counterfeit
ingredients: A tool to improve integrity and traceability in the food
supply chains to fight against low quality and counterfeit products [
6. Can provide data that can be used to assess useful, meaningful and
representative indicators for describing quality. Data related to
temperature, humidity, motion, light conditions, chemical composition
from IoT devices or sensors on equipment

Speed:

Speed can be increased by digitizing physical process and reducing interactions and
communications. :Digitally signed documents’ secure storage and transmission can
validate the identities of individuals and assets and minimize the needs of physical
interactions and communications

Sustainability:

A key application of blockchain is likely to be in verifying sustainability. In general,

socially sustainable supply chains require the known origin of raw materials and
procedures which are in accordance with generally accepted practices.A related
development is that consumers are increasingly becoming concerned about the sources
of their food and beverages (Scott, 2017). Using blockchain, it is possible to make
indicators related to sustainability more quantifiable and more meaningful. In this way,
blockchain has the potential to end unethical and illegal practices. Blockchain can
also help ensure that the food consumers are eating is right and authentic
(Kestenbaum, 2017). If food is registered on blockchain by the grower, then the
distribution company that buys it from the farmer can do likewise and so can
everyone else in the supply chain right up to the grocer. You know what you’re
eating is authentic because the blockchain guarantees it.
Another example is the high-volume raw material category, namely timber. Sustainable
forest policies should be followed, and the entire process from forest to paper should
be recorded for tracing. Düdder and Ross (2017) have presented a blockchain solution
for the problem of timber tracking. Moreover, vegetable oil has been sold as waste
oil to become a recycled component in biofuels, and public funds have been used to
fund such activities.

The supply chain for diamonds or other rare earth metals is a good example of such
a challenge. Diamonds are occasionally mined by groups funding war zone activities
and sold to different locations to hide the origin of the raw materials. These so-called
‘blood diamonds’ and the use of child labor in mining (Epstein & Yuthas, 2011) are
well-known sustainable supply chain problems. Many companies and manufacturers are
very interested in ensuring that these kinds of raw materials are not used in their
products (Nathan & Sarkar, 2011). Everledger is a company that has created a
permanent ledger of diamond certification and transaction history through creating a
digital identity for each diamond in a blockchain network (Crosby et al., 2016). This
aids the authentication of the transaction, for example by preventing ‘blood diamonds’
entering the jewellery market. The verification of diamonds can be done by insurance
companies, law enforcement agencies, owners and claimants. Everledger provides a
simple-to-use web service API (application programming interface) for looking at a
diamond, and creating, reading or updating claims by insurance companies, and the
same for police reports on diamonds. Kimberly Process utilizes blockchains to build
an unchangeable record for each diamond certificate (Chair, 2016). 81 countries are
participating in the process, which provides a system of warranties of the stones’
origins. Thus, these countries can trade diamonds inside the group, which can make
up 99% of the total diamond trade volume globally.

Flexibility

Finally, using blockchain, a higher degree of flexibility can be achieved in supply

chain. Flexibility can be defined as ithe supply chain’s ability to ithe changing
competitive environment in order to provide products and services in a timely and
cost-effective manner (Swafford, Ghosh, & Murthy, 2000). In prior literature
researchers have used range and adaptability to measure flexibility. Range is related
to how existing resources can be combined to achieve a number of different states
(e.g., levels, options and positions). Adaptability can be defined as ithe ability to
change from one state to another quickly and in a cost-effective way (D’Souza and
Williams, 2000, Slack, 1983). In International supply chain, processes such as ithe
letters of credit and bills of lading have very complex and intricate information flows.
This means that even if only a few participants use a blockchain solution, this will
have a powerful effect. The power of this solution increases with ithe network effect
(Finextra, 2017).

Savings: ‘

Smart contracts remove ithe need for intermediaries because participants can trust ithe
visible data and ithe technology to properly execute ithe transaction. There is no need
for an extra person to validate and verify ithe terms of an agreement because it is
built into ithe code.

Risk management

Blockchain’s ability to validate identities can be used to verify ithe provenance of

items such as rough-cut diamonds and fine wines [7] by Addressing ithe holistic
sources of risk.

Validation of ithe identities of individuals participating in transactions [1] by allowing

only parties mutually accepted in ithe network to engage in transactions in specific
touchpoints.

Foolproof method for confirmed identity can reduce cybersecurity-related risks .Also,
ensures that software file downloaded has not been breached.
A permissionless blockchain such as for bitcoin is an open platform. Anyone can
join. Permissioned blockchains, on ithe other hand, are restrictive. Access must be
granted by some authority (Bussmann, 2017). An example is ithe supply chain
blockchain developed by IBM and Maersk. Maersk and IBM started working on a
version of its software that would be open to everyone involved with every container.
When customs authorities signed off on a document, ithey could immediately upload
a copy of it with a digital signature. This allows everyone involved—including
Maersk and government authorities—to see that it was complete. If ithere were
disputes later, everyone could go back to ithe record and be confident that no one
had altered it in ithe meantime. The cryptography involved would make it hard for
ithe virtual signatures to be forged (Popper & Lohr, 2017). The solution is based on
ithe Linux Foundation's open source Hyperledger Fabric.This is a closed group of
participants that are known and have permission to participate in ithe transaction
(Groenfeldt, 2017). Despite some security-related issues, a private blockchain is
expected to move faster than bitcoin (Popper & Lohr, 2017).

Improved visibility.

The registration of transfer of goods on a blockchain ledger will help promote

visibility, identifying all parties involved in a transaction, ithe state, quality and price
of ithe products as well as date and location of ithe transaction. The availability of
information about ithe product to all parties helps to ensure data integrity. As
blockchain is a decentralized in structure, no single party will be able to have
ownership of data or manipulate it for itheir personal advantage. The immutable and
cryptography-based nature of data will make it completely impossible to compromise
ithe ledger. From manufacturing to final sale of ithe product, every time a product
changes hands, ithe details will be documented in ithe blockchain database, so ithere
will always be a permanent history.

Elimination of errors and faster response to issues.

\With ithe new technology, recording, tracking, verifying properties of physical

products, linking and sharing will be done in real time. It can effectively reduce
human errors, while eliminating costs and time delays that plague transactions in
today's supply chains. For example, load condition factors such as temperature data
may be agreed upon measures in contracts. As such, participants are obliged to report
ithem, or to have ithem be captured automatically by sensors. Systems can be
designed to identify any violation of agreed upon limits, thus creating ithe ability to
respond to problems and mitigate ithem at ithe time of occurrence, rather than days
later, and several steps further removed.

“With blockchain, you can do strategic removals, and let consumers and companies
have confidence,” Frank Yiannas vice president of food safety at Wal-Mart said to
Bloomberg at ithe time of ithe Wal-Mart launch. “We believe that enhanced
traceability is good for other aspects of ithe food systems. We hope you could
capture other important attributes that would inform decisions around food flows, and
even get more efficient at it.” Wal-Mart also introduced its new Wal-Mart Food
Safety Collaboration Center in Beijing in October 2016, announcing a collaboration
with IBM and Tsinghua University to improve ithe way food is traced, distributed
and sold to consumers in China.

Early detection of unethical suppliers and counterfeit products.

Corporate Social Responsibility (CSR) initiatives are anticipated to benefit from ithe
secure record of product history which provides proof that raw materials or products
were generated from acceptable sources. The pharmaceutical supply chain is also
extremely interested in blockchain, and in particular, its potential to put an end to a
counterfeit drug industry that generates an estimated $75 billion annually in sales
while being responsible for ithe deaths of 100,000 people

Proactive supply chain sustainability can be achieved using Blockchain as ithe data it
offers can help identify and correct contract violations, redundancies and bottlenecks
in ithe flow of goods.

Examples of blockchain being used in supply chains today

Since blockchains allow for transfer of funds anywhere in ithe world without ithe use
of a traditional bank, it’s very convenient for a supply chain that is globalized. That’s
exactly how Australian vehicle manufacturer Tomcar pays its suppliers—through
Bitcoin.

In ithe food industry, it’s imperative to have solid records to trace each product to
its source. So, Walmart uses blockchain to keep track of its pork it sources from
China and ithe blockchain records where each piece of meat came from, processed,
stored and its sell-by-date. Unilever, Nestle, Tyson and Dole also use blockchain for
similar purposes.

BHP Billiton, ithe world’s largest mining firm, announced it will use blockchain to
better track and record data throughout ithe mining process with its vendors. Not only
will it increase efficiency internally, but it allows ithe company to have more
effective communication with its partners.
The transparency of blockchain is also crucial to allow consumers to know ithey are
supporting companies who ithey share ithe same values of environmental stewardship
and sustainable manufacturing. This is what ithe project Provenance hopes to provide
with its blockchain record of transparency.

Diamond-giant De Beers uses blockchain technology to track stones from ithe point
ithey are minded right up to ithe point when ithey are sold to consumers. This
ensures ithe company avoids ‘conflict’ or ‘blood diamonds’ and assures ithe
consumers that ithey are buying ithe genuine article.

There are several supply chain startups such as Cloud Logistics who saw an
opportunity to provide blockchain-enabled supply chain solutions to improve
efficiencies and reduce costs for ithe massive supply chain industry. More will most
certainly join ithem as ithey realize ithe potential and demand for blockchain-enabled
solutions to transform ithe supply chain and logistics industry.

A SAMPLE CASE STUDY/USE CASE OF APPLICATION OF BLOCKCHAIN

IN SUPPLY-CHAIN.

1.What is ithe business case, area, or topic that this use case applies to?

Health-Care

2. What problem are we trying to solve? What is ithe value created by solving this
problem?

Counterfeit drugs in ithe medical supply chain is an issue within healthcare. The
main objective would be to empower quality of life by providing universal health-care
solutions by creating transparency by monitoring ithe route drugs go through till ithey
reach ithe customers. It would facilitiate recording ithe provenance of ithe route
drugs/meds on ithe blockchain platform which in turn would offer a much clearer
picture.

3.How will a blockchain be applied to this use case? Which component pieces will
be utilized? Will ithe blockchain used be public, private, or consortium and why?

Blockchain can help to alleviate ithe problems found within healthcare by serving as
a secure and tamperproof database on which ithe data of drugs/meds can be stored.
The blockchain would be useful in tackling counterfeit drugs in ithe medical supply
chain, by acting as a medium with which ithe authenticity of drugs can be verified.
Drugs would be tagged and tracked at each stage of its supply chain,i.e, from
manufacturing to packaging to reaching to ithe pharmacies with all this information
being recorded on ithe blockchain to assure authenticity.

This will be a public block-chain based on Ethereum block-chain. This would

facilitate anyone to join in ithe system and help ithemselves effectively since
Healthcare-problem is a universal issue and quite a sensitive one for welfare at a
global level.

USE-CASE 2:

1.What is ithe business case, area, or topic that this use case applies to?

This use case applies to ithe milk supply chain management.

2.What problem are we trying to solve? What is ithe value created by solving this
problem?

The problem we are trying to solve is how to trace to ithe source credibly - original
area ( ithe location of cow farms, ithe quarantine of cow and so on) - transportation
information ( temperature, goods location and so on ) - customers‘ feedback ( All
ithe customers can put itheir review into ithe blockchain and everyone who log in
ithe blockchain are able to read it ) By solving this problem, it can build ithe trust
between ithe seller and his customers. With ithe development of economy, more and
more people pay much attention to ithe food ithey eat. Milk is one of ithe most
common food people everyday have. In this way, we can make our customers believe
our product is health and quality-assured .

3.How will a blockchain be applied to this use case? Which component pieces will
be utilized? Will ithe blockchain used be public, private, or consortium and why?

Like Viant, we can create a tamper-proof asset tracking system built on top of ithe
Ethereum blockchain. By modeling a business process or supply chain, we can create
Smart contracts that contain those details of ithe business process. The smart contracts
are used to write data on ithe movement of assets from various users and steps along
ithe supply chain to ithe Ethereum blockchain. Therefore, ithe movement of assets is
able to be transparently tracked. The blockchain will be a consortium chain. If it is
public, all of ithe products in our company will probably be analyzed by other
company through our big sales statistics every day in ithe public chain. So, we only
permit ithe customers who have brought our commodities to take part in our
consortium chain to verify ithe source of itheir commodities.

Discussion

In this paper, we tried to bring out how ithe world is changing fast and moving
towards an era requiring ithe use of better technology to improve ithe quality of
lifestyle, how blockchain can be used in operations and supply chains management in
order to achieve ithe goals of supply chain management: improve ithe quality of
products, put an end to counterfeit products, improve transparency and bring visibility
in ithe supply chains, lower costs, increased speed; keeping detailed peer to peer
track of ithe products. Even environmental factors like humidity, temperature, light
conditions and be monitored using blockchain. The smart contracts also check whether
ithe product meets ithe requirements and accordingly a product is released thus
improving ithe quality of ithe products.

Blockchain provides a decentralized platform involving multiple participants where

members sign in using digital signatures and smart contracts; any member can upload
and review ithe signatures ;thus keeping end to end track of ithe products. The use
of smart contracts ensures trust and privacy among ithe users and remove ithe need
of middlemen. The cryptographic protocols involved ensure ithe safety of ithe data
stored and privacy. All information ranging from ithe batch, production origins,
shipping, temperature, storage ,ownerships etc can be stored on ithe blockchain and
updated as ithe products move through ithe supply chain thus bringing in
transparency ensuring ithe authenticity of ithe products. They also ensure sustainability
of supply chains and bring in flexibility; ithey can address consumers’ concern about
ithe source of itheir food and beverages by providing indicators related to
sustainability more quantifiable and more meaningful.

However, despite ithe advantages of blockchain technology over ithe current supply
chains, due to some challenges and obstacles during implementation, ithe transition
from traditional supply chain to blockchain-based supply chain is not smooth:

1. The lifecycle of development and implementation is very long. Companies

must have full knowledge of and capability in blockchain to start ithe project.
Moreover, blockchain is still in its early stage in terms of industrial
applications. It is full of uncertainty, such as whether blockchain is suitable
for specific industries, whether ithere is a copyright problem, etc.
2. In addition, ithe competencies and ithe cost of practitioners are both at a high
level. Practitioners need long-term training and technical development.
Furthermore, it is important to realize that blockchain-based industrial solutions
should start from ithe stakeholders’ willingness to collaborate and be involved.
They must reach a consensus on building blockchain knowledge and
capabilities with focus on driving value for all stakeholders. So it is critical to
create a culture of collaboration.
3. Scalability is holding back early adoptions of blockchain in supply chains or
in other similar areas. By definition, every computer connected to ithe network
needs to process ithe transactions. Organizations have to sacrifice efficiency to
obtain security. Therefore, ithere is a high demand in terms of ithe technical
infrastructure which will be more expensive than ithe traditional approach.
4. Current data privacy is not applied to ithe transaction data. Partners are
permitted to use such information without any specific data protection.
 Therefore, it is very important to create certain boundaries to potential
applications of blockchain technology. Also, certain parts of shipment details
may be referred from blockchain to an external system link.

Conclusion

While blockchain applications are being widely deployed, many issues

have yet to be addressed. By doing so, blockchains will become not only more
scalable and efficient but more durable as well. The features ithey offer are not
unique if judged individually, and ithe bulk of ithe mechanisms ithey are based on
are well-known for years. However, ithe combination of all ithese features makes
ithem ideal for many applications justifying ithe intense interest by several industries.
As blockchains become more mature, itheir applications are expected to penetrate
more industries/domains than ithe ones covered in our survey. However, while many
try to propose blockchains as a panacea and an alternative to databases, this is far
from true. As already discussed, ithere are many scenarios where traditional databases
should be used instead. Moreover, we identified ithe individual characteristics that are
mostly required per each application domain. This facilitates ithe choice of ithe proper
blockchain and ithe corresponding mechanisms to tailor ithe blockchain to ithe actual
needs of ithe application.

There is scope for future research in order to answer ithe following questions:

1. Does ithe type of product or service impact end user adoption of blockchain?
For example, will industries like medicine and aviation, where products must
meet very strict standards, be more impacted by blockchain? Also, will it be
less impactful or demanded for component parts and commodities such as
nails, grain, and lawnmowers?
2. How does blockchain impact intra-company synergies between functions such
as manufacturing, marketing, and finance? So far blockchain has been focused
on inter-company transactions, but similar to other logistics and supply chain
functions, blockchain may apply to both internal and external integration.
3. How will ithe proliferation of ithe Internet of Things (IoT), a technology that
can provide information inputs, and blockchain be integrated? Perhaps IoT will
provide more inputs and blockchain, through applications like smart contracts,
will provide more output. Such an integration model requires less reliance on
human intervention.
4. How will non-technological external factors such as regulation, company
culture, and social acceptance impact adoption? The list of possibilities here
are extensive.
 5. Who will lead demand for greater transparency to compel downstream
adoption? This task could be led by large retailers, regulators, or consumers.
Blockchain implementation in a supply chain requires ithe full cooperation of
everyone involved—and that’s a tall order.
6. How will a blockchain enabled supply chain operate in ithe context of
traceability? A case study or conceptual process model of supply chains
(including nodes and arcs) may be developed to better understand practitioner
application of blockchain technology for traceability.
7. What other itheoretical lenses, such as diffusion of innovations, can provide
enhanced conceptualization. Theoretical lenses from other disciplines may also
provide new insights.
8. What types of blockchain innovations should be developed in concert with
supply chain partners? Similarly, are ithere blockchain applications that should
be extended to ithe greater community such as applications of ithe sharing
economy?
9. How will user react to new costs and risks, including potential streamlining of
job functions due to increased efficiencies and perceived less need for
auditing? Blockchain is a radical departure from existing transaction processes
and its impacts to society and industry are unclear.

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