Corporations Adopting Blockchain: How Can We Make Things Better in 2019? – BlockShow Loading...

Corporations Adopting Blockchain: How Can We Make Things Better in 2019?

Corporations Adopting Blockchain: How Can We Make Things Better in 2019?
Corporations Adopting Blockchain: How Can We Make Things Better in 2019?

Despite the proverbial ‘Crypto Winter’ going on right now, we can’t say that this global industrial downturn really affects the Blockchain field; on the contrary, the interest for the technology and related developments not only stays quite high but is also gaining momentum.

However, just as with any other innovation, the process of its utilization doesn’t go without both external and internal complications. According to a survey held in September 2018, there are top-3 major barriers for successful Blockchain implementation: regulatory uncertainty (48%), lack of trust among users (45%), and inability to bring network together (44%); these boundaries, in the view of the respondents, are going to affect businesses and organizations in the next 3 to 5 years.

Businesses and Corporations harnessing Blockchain have been actively discussed for the entire 2018, and also was a subject of substantial discussions at all the BlockShow conferences of last year held in Europe, the US and Asia. Obviously, this trend moved on to 2019, and if so, it’s within our grasp to figure out some steps which hopefully will help things work better this year. Heeding the opinions the speakers have been expressing during our events, we’ve formulated three basic points.

Keep teaming up!

The increasing number of corporate giants right now are finding it effective to establish alliances and partnerships to tackle Blockchain. Microsoft, one of the biggest members of Enterprise Ethereum Alliance, also partners with ID2020 Alliance with a mission to aid over 1B people globally to obtain legal forms of ID. Another good example is Wallmart attempting to harness Blockchain since 2016 and eventually teaming up with IBM, Nestle, Unilever and others for developing enhanced supply chain tracking.

We can go on and on with these examples — this has been practicing for quite some years now. Besides, the point is not to demonstrate how ‘revolutionary’ this approach is — we just want to make the effectiveness of building such collaborations as obvious as it can be. If we take a moment to look at things from the global perspective, we’d remember that Blockchain is a very young technology with lots of unsolved questions and difficulties to overcome. In order to make it truly mainstream, corporations and worldwide businesses will have to unite their resources in 2019: finance, power, as well as human talent. This strategic decision will bring a double benefit, not only taking the technology itself to a new level but also showing corporates some new dimensions of collaborative innovations.

At BlockShow Asia 2018, Artiona Bogo, Blockchain Adoption Lead at SAP, expressed her thoughts on this approach:

“…Major players apply power to actually start working on Blockchain scenarios, which is very ironic, because we say Blockchain is there to distribute power, but the way how it starts is by […] putting some players together in the same room, and sometimes we see that even competitors are together discussing applicability of Blockchain scenarios. If you think the Blockchain is there just to revolutionize or to reimagine business processes, you are missing out on the biggest potential of Blockchain, which is the way how Blockchain revolutionizes co-innovation. So, we now see for the first time major competitors sitting in the same room and thinking about how they can better collaborate with one another.”

– BlockShow Europe 2018, “Blockchain in Enterprise Environment: Corporate Giants are Stepping In”

The Blockchain is not a magic pill

Experience has shown there’s a lot of Blockchain misconceptions among companies from outside the ecosystem. We want to point out one the most serious ones, revolving around the Blockchain’s omnipotence and the quite common belief that the technology is capable of bridging any gap in the company’s business model, products or services.

No, we’re not going to devalue the global impact of Blockchain, and yes, we can appreciate the fact Blockchain has successfully found itself hundreds of use cases in global industries. Our point is that despite all these high-profile achievements when we look at some particular cases, Blockchain just can’t (and shouldn’t!) become the ultimate all-solver for any company.

First of all, let’s not forget that Blockchain isn’t free and definitely isn’t cheap. Just as any other development, it’s very time- and resource-consuming and requires lots of efforts on all levels — from complex research to large financial inflows.

During BlockShow Asia 2018 Mark Smedley, Industry Vice President of Financial Services at Oracle (Top-50 Largest Public Companies Exploring Blockchain), stated:

“Blockchain is way overhyped from a corporate perspective. It was going to wipe out the middlemen, it was going to transform business models, it was going to revolutionize everything from banking to accounting […]. The other one […] is when you look at what it really takes to build a Blockchain network, there’s more work there that was ever discussed. To forge a consensus agreement and build a smart contract between two parties, let alone a 100 parties, is quite difficult, at least time-consuming.”

– BlockShow Asia 2018, “Corporations Tackling Blockchain”

Okay, but let’s imagine that these practical difficulties are all in all bearable for the corporations — what’s next? The decision of implementing Blockchain might not only turn out to be inefficient but also bring some new critical issues. Just as any other technology, Blockchain has its own vulnerabilities and, just as was said before, still raises many questions which may adversely affect many existing systems comparing to the ‘traditional’ way of functioning.

Henri Arslanian, FinTech & Crypto Lead at PwC Hong Kong and Smedley’s co-speaker, confirms this statement. He comments from the perspective of financial institutions:

“I agree with the ‘overhype’ but frankly I think that everybody that thinks banks will move their backend to Blockchain in the next couple of years is very naive. The existing system is obviously not perfect, but it still works. Unfortunately, before we move to Blockchain, I think that we still have the way to go.”

– BlockShow Asia 2018, “Corporations Tackling Blockchain”

Should it necessarily be Blockchain?

Wrapping it up, we’d like everyone to ask this logical question to themselves. After all, we’ve already found out that Blockchain cannot solve all the problems; in the meantime, there’s plenty of other innovative technologies and solutions around, often being closely connected to Blockchain, which might help some companies improve existing systems in way more efficient manner. For example, despite the current market crisis, Henri Arslanian strongly advises to pay attention to Crypto:

I see some really good [Blockchain] use cases, like provenance, traceability, trade finance, but from a more broad perspective, I’m not too optimistic. […] I personally believe we’re going to see institutions adopt Crypto earlier that moving their entire backend on Blockchain. Frankly, I wouldn’t be surprised if over the next 2–3 years every large institution will have some kind of crypto offering available to customers.

– BlockShow Asia 2018, “Corporations Tackling Blockchain”

Would be great if all corporates and enterprises raised this question before implementing anything to their business. After all, it will be a win-win situation for everyone — corporations would figure out the most optimal solutions, while the Blockchain ecosystem will continue evolving rapidly — this time in a more efficient way.