Importance of Blockchain in Supply Chain Management

Blockchain technology plays a vital role in bringing digital transformation to modern enterprises. This futuristic technology can be readily integrated into any sector to streamline core processes and simplify complexities.  

Irrespective of the industry sector, blockchain can strengthen the supply chain by offering origin tracking and enhancing transparency. In this article, we are going to discuss the importance of blockchain in managing supply chains.

But, before digging deep into the role of the blockchain app development process in Supply Chain Management (SCM), let’s understand the concept and major challenges. 

SCM- Introduction and Key Challenges

Supply Chain Management (SCM) is referred to as an approach to manage the seamless flow of resources, goods, services, and information throughout the process of converting raw materials into the final product. 

Supply chain management involves seven major elements- Information, Source, Planning, Production, Goods Return, Inventory, and Transportation. These components also act as pillars of modern enterprises. 

However, the supply chain management witnesses multiple challenges and security concerns. It is difficult for the standard supply chain to sustain its relevance with these challenges, but the blockchain app development process can help it. Here are the key challenges for the supply chain management industry. 

Prominent Challenges of Supply Chain Management for Various Industries

The supply chain is an integral part of almost all industry sectors. It faces the problems including-

Minimal asset traceability

This is one of the biggest problems for the global supply chain domain. Though industries are keen to address this problem effectively, it is difficult to trace assets in real-time. 

Exploiters can replace original products with duplicate ones, which can cost companies their reputation and loss of revenue. 

Cumbersome assessment of asset quality

Lengthiness makes the assessment of asset quality difficult. 

It is also possible that the industry has to face the consequences of the lack of having an effective risk management system. 

Additional costs

Every company has to spend some amount to collect and store user data. Other additional costs include cloud storage and data security-related charges. 

Lack of centralized approach

Though the global market is interconnected and supply chain management relates to almost every sector, many enterprises tend to keep their database inaccessible for other companies. 

As a result, there remains a lack of a universal database and exploiters can easily leverage its benefits for implementing cyberattacks. 

Ever-changing consumer needs

As the business grows, it becomes more difficult to keep the pace with ever-changing requirements and expectations of consumers. 

Taking viable measures to meet such needs effectively is even tougher. Therefore, it is necessary to take assistance from advancing technology.

Originally source: role of blockchain in supply chain management