It is becoming clear as to why you should consider using the technology behind blockchains for your supply-chain management systems. A few years ago, most people were either ignorant or too busy to be interested in blockchains at all. But now, this technology has become so popular that even many big businesses are using it. So how does one use it in their supply chain management systems?
The first application of blockchains for supply chain automation is through its use in digital signatures. A digital signature is a process that lets two or more parties agree to a specific transaction, without being able to see the transaction itself. However, if they can see the digital signature (known as the hash), they can figure out exactly which transaction happened in the chain and what was in the chain’s final result.
The most commonly seen example of a digital signature is when someone sends an email with a link attached, where in that email they state the hash is X.X.X. Therefore, the user knows that the hash is true and can trust it because the user knows X.X.X.
This same concept can be applied to digital signatures that occur on the physical level. Suppose for example that two entities wish to sign a contract. If a third party knows the exact signature, then he can verify that the signature is real and can verify that the other two parties know the hash.
Blockchains in the supply chain can also help with the creation of smart contracts. This means a system that allows two or more entities to make promises, without ever having to see the actual transaction itself.
This allows the parties to get a feeling for the trustworthiness of each other by signing a smart contract. If one party signs it and the other one are not convinced, then they can go ahead with the transaction without ever seeing the other party. Once they sign, then it becomes irreversible. They will be forced to prove they are serious in order to have access to the funds in question.
This is used to ensure that all parties get their share of the money in the contract without losing the entire contract. The contract is stored in a “chain” that keeps the transaction alive until all the parties involved in the contract sign the chain have been convinced they want to continue.
Also, this is used to create accountability between entities. Say for example a vendor offers a discount to a customer. The company can use the digital signature in the contract to make sure they get their fair share of the discount, and not the customer. If they don’t get the discount, then they can go to the vendor and get a refund for the price they paid.
This type of contract is very similar to what happens in business, where they would be forced to sign if they don’t want to. However, instead of going through the legal process, the chain can help them get their money back.
The blockchain is a great way to save time as well as energy. When a person signs the smart contract, they are only required to enter into it once, while the network ensures the contract is there long after it was signed.
With this type of system, it can take less than an hour for transactions to happen, and in most cases, the chain is completely secure before it is even put into place. The only time the network requires to process the transaction is when a third party wants to check on it.
A main benefit of the system is that it can help to avoid mistakes. It can help to prevent someone from using the wrong information, or committing frauds. The chain can also help to make sure that all transactions go smoothly. Even though the chain cannot stop anything from happening, it can give people confidence that all transactions are legitimate and legal.