Blockchain: towards a neutralization of the balance of power

While the world is transforming at the pace of digital advances, industrial ecosystems and the entire value chain are about to evolve with regard to disruptive technologies, of which blockchain is one. Between the disruption of power and trust relationships, blockchain, which is at the origin of new issues, raises many questions.

A disruptive technology with high potential

Accompanying the disruption of an activity, improving existing processes, and better understanding data are the three main purposes of disruptive technologies, not to say their raison d’être. Moreover, each purpose has its own technology: if the improvement of traditional processes is made possible by digitization and automation, it is on the other hand through machine learning and artificial intelligence that it is now possible to improve our understanding of data in order to exploit it. As for the disruption of activities, it can be accompanied by innovative solutions proposed by start-ups… or the revolutionary blockchain, whose interest lies in the inviolability and traceability of data. The blockchain? A sort of immutable digital register, available to all, in which every action carried out by a member of the system is recorded immediately and unalterably.

The implementation of a blockchain solution between multiple industrial actors – manufacturers, subcontractors, suppliers, customers, government, employees – requires the actor who drives it to persuade all third parties of the need to digitize and trace their exchanges. As an example, and in view of what they could gain, mass retailers could convince their suppliers to set up a blockchain to facilitate product traceability as could agricultural cooperatives wishing to negotiate directly with local retailers rather than going through the mass retailers’ purchasing centers.

The difficulty of convincing all the stakeholders in the ecosystem

While for the moment information is still communicated at the whim of the players, the blockchain implies a permanent sharing of all data within its ecosystem. Indeed, it is an intrinsically collaborative technology with total transparency of operations and business model -possibly up to costs and margin sharing between actors-, from manufacturer to customer.

However, the transition to digitalized exchanges in a blockchain solution is still struggling to convince. While the main user companies, visionaries, have succeeded in overcoming the complexities of the concept, the more pragmatic still expect blockchain to meet an easily stated need. In short, the market is not yet mature, and solutions are still at the experimental stage.

A model of trust

A distinct behavior of companies in the adoption and deployment by the market of this new technology is foreseeable. Indeed, it is currently the player who has the upper hand on the system or, conversely, the one who wishes to free himself from a power relationship that has the most interest in using this innovative solution, whether to maintain his leadership or consolidate his defensive position. The role of start-ups is limited to the design of blockchain solutions, although some – the most talented – have disrupted the market.

Tomorrow, blockchain will be a concept with its own culture, foundations and standards, just as corporations, cooperatives and associations are today, with an almost perfect alignment between computer programs and regulatory frameworks. Moreover, there is no doubt about its success in Europe, a country where, traditionally, all economic exchanges are systematically formalized by contracts and regulated by law.

3 markers of this new economic model stand out

The choice of the granularity of the monitoring of flows will be decisive to ensure a good relationship between the complexity of the flows to be modeled and IT performance. For example, a blockchain-based solution is currently capable of tracking the production of a tomato sold in a hypermarket or guaranteeing the allocation of funds to an association in the context of the reimbursement of its carbon consumption. In the medium term, the ambition will undoubtedly be to follow a more complex activity such as that of a driverless cab, with the autonomous car as the only object connected to the entire ecosystem (customers, dealer, parking and energy recharging operator, etc.).

Parameterization will become strategic for the ecosystem. Thus, specifications co-written by all the players in an ecosystem should emerge over the next few years. In addition, if “code is the law” and “each coder leaves a bit of his personality in his program” then there is no doubt that expert developers will be selected for their skills… and their ethics.

Operation and maintenance will need to be carried out by a third party in order to avoid any manipulation by one of the actors of the blockchain ecosystem, or by a stricter legal framework: joint venture or Economic Interest Grouping for example.

Of course, blockchain requires the skills of experts to be implemented. The good news is that many European ESN1 companies are able to offer solutions that can be used directly. In short, the success of the development of blockchain does not lie in the ability of organizations to master the technology, but in establishing a new relationship of trust between economic players.

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