7 Questions to Ask Yourself Before Implementing Blockchain in your Business
If we go to the beginning of the Blockchain journey, we can say that everything started with the first cyrptocurrency Bitcoin, which appeared on January 3, 2009.
As with every innovation, it was not a question of the fact that this was a trap and such a structure would not work. This issue discussed for a long time, but during this time, Bitcoin investors have increased the market value of Bitcoin. The story is quite similar with the rise of the Internet.
When chair of Intel, Andrew Grove said “ In five years time, there won’t be any internet companies, all companies will be Internet companies or they will be dead” this statement sounded pretty funny in 1999. However, time showed that he was right. So, this uptrend of Bitcoin led to the creation of alternative crypto coins, leading the creation of today’s crypto market and gave a new impulse to business world.
We can define Blockchain technology as a distributed database that provides encrypted transaction tracking. As the name implies, Blockchain technology, which is built with a chained model and which is able to be followed closely, enables to operate independently from a center and thus the transactions can be performed directly between the buyer and the seller safely.
Even some experts who suspect Bitcoin itself today believe that blockchain technology will benefit in many areas. Blockchain technology, which is expanding its development and usage areas with its secure infrastructure, continues to improve by changing the way many sectors work.
If you are willing to implement blockchain in your business, you should be aware of some key factors and ask some question to yourself. So what are these questions?
- What is blockchain?
Before you make your decision for implementing blockchain in your business, you have to know basic principles of blockchain technology. You have to look at it in three ways; technical, business and legal. Technically it is a backend database that has a distrubited ledger, like for accounting. On the business side, it gives a chance to peers for transferring value as a exchange network. While transactions, it doesn’t require someone in the middle to validate this transaction, so that’s the legal point of blockchain.
2-What exactly are you trying to achieve?
Look carefully at your business requirements and be sure if you really need a blockchain technology. You should know what you want from this implementation. Otherwise, it could be waste of time and money. You have to find the right problem before you can build the right solution.
3-Do you have the right business to implement Blockchain technology?
If you have a business which requires privacy between two parties, for example, pricing information between producer and a retailer, then blockchain may suits for your business well. Blockchain technology provides many significant advantages. However, these benefits show a change due to your business. Transparency, privacy, reduced costs and low fees, better security, improved data quality and many different benefits can be provided by blockchain technology to your business. Blockchain is based on principles of transparency, time and cost efficiency, security and process integrity.
There are many cases that can create an incredible value, but what is more important is to make sure you have selected to right ones. Imagine that, a person is running completely irrelevant business with blockchain technology and wants to have this implementation in his business, time, energy and money loss occur.
4- How do you plan to get maximum efficiency from Blockchain technology?
It is still more expensive and time consuming to build a blockchain application than a traditional cloud app in many situations because blockchain is a new technology at the present time. Unlike many businesses today, the blockchain provides a decentralized formation. So, while planing this implementation, businesses should consider and ideate the future state. What will your business look like when it becomes a decentralized network? Usually, this networks look fully different and radically better. The steps in business processes get fewer than current ones, costs and expenses decrease and customer/user experience develops.
It is important that when making choices about blockchain technology you consider how it will integrate with the current architecture, and make the appropriate product selections and designs in accordance with this. Most of the companies are tend to use IBM Hyperledger Fabric and Ethereum. However, there are many different and new Technologies you might want to use. There is no doubt that new ones will be added into this technology every day.
IBM Hyperledger is open-source blockchain service that helps customers for creating, deploying and managing blockchain networks.
Ethereum is the decentralized smart contract platform designed for general purposes. It has one of the largest developer pool. Enterprises are free to choose their implementation partners.
6- What could Blockchain technology do for your business?
The potential of blockchain technology for any business is huge. However, being aware of this benefits will better help them implement the technology more efficiently and correctly. Security of transactions will be improved, costs will be reduced. Moreover, it will help your supply chain with reducing potential lag or downtime. With faster and more accurate transactions, you will build a better user and customer experience.
IBM is aiming its blockchain technology at the needs of business. Its customers include retail giant Walmart, which is using the technology to ensure food safety. Walmart tracks its produce from the farm to the store shelf to confirm items have not been contaminated or are not past their sell-by date.
That makes it easier for companies along the supply chain to track items when an order is placed. They can keep track of the movement of items to ensure there are no delays, and can confirm the right amount of inventory products are being delivered.
7- Are there disadvantages of using Blockchain technology?
Faster transactions, better security and much more efficient supply chain are very good reasons to use blockchain in your business. Businesses interested in accessing Blockchain technology are more interested in benefits. However, one of the important questions to be asked is whether this technology has disadvantages. The main reason for the development of concerns is that this technology is a slightly gray zone and that the legal procedures vary from country to country.
So you better know this legal procedures where your business located and be aware of the governmental issues which can appear.
Writer :Ertuğrul Bülbül
Designer : Weronika Prasek