How Will Blockchain Be Applied in the Logistics Industry?
As advances in digital technology reshape the logistics industry, blockchain technology is becoming a top priority for most organizations.
Blockchain is a decentralized distributed technology specifically designed to transform business operations.
At its core, blockchain is a digital ledger comprising a list of linked blocks stored in a decentralized network, secured by cryptography. Each block contains encrypted information and information linked to the previous block, making it difficult to change it retroactively without changing the entire chain and the replicas on the peer network, and new blocks are approved by group members on the network. Cryptography and membership functions allow easy data sharing between parties without breach of privacy and tampering of records.
Major Blockchain technologies:
- Public Blockchain is a decentralized platform that allows anyone to add themselves to the network, read transactions, transfer assets and participate in the consensus process. Bitcoin and Ethereum are a few of the most popular examples.
- Private Blockchain is highly centralized in nature, a platform that only allows a pre-approved group of members to read and submit their transactions and participate in the consensus process. It is generally built to manage organizational functions within companies or organizations for audit purposes. A good example of the reference data management system Private Blockchain.
- Consortium Blockchain is a combination of Public and Private Blockchain technology. Consortium Blockchain is a hybrid system that combines the decentralized nature of Public Blockchain and the permissions system features of Private Blockchain.
Blockchain in load tracking and data security
For many organizations, the ability to more effectively track goods in the supply chain is one of the most compelling benefits of blockchain . Although shipping tracking is not new, it has been supported by organizations for many years thanks to GPS technology. Historically, location updates were provided by telephone calls and the use of fax machines. It was later replaced by automated systems such as EDIs and APIs . However, with the industry’s ever-increasing customer expectations and retailers’ demands for same-day or even one-hour delivery, traditional methodologies are struggling to meet these demands.
Organizations or companies always prefer updated data to increase efficiency, so that they can make pro-active decisions and share data with users. As data passes through various systems, there is a possibility that it may be misinterpreted, altered, or manipulated without the knowledge or consent of the owner. This can cause turmoil in the global supply chain.
Blockchain contributes to the establishment of an environment of trust in the entire ecosystem, as it contributes to the verification of all data in the system. In addition, data integration is simplified as the data is stored in a decentralized manner; all systems are connected to a single node to access reliable data.