Trust is good,...

The discussion about the vaccination certificate has shown how important technologies like blockchain are today. How does this technology work?

Basically, a blockchain is a (mostly) distributed public or private database. It is used to manage different forms of data. The name comes on the one hand from the units (blocks), in which a large amount of data is summarized in each case, and on the other hand from chain, in which the data is added in chronological order. This describes what a conventional database also does. Therefore, a blockchain only makes sense if it has further benefits.

The first is the protection against falsification. As already mentioned, the data is appended in its historical sequence. In principle, data is not deleted. As long as a block is not full, further data is stored in it, otherwise a new block is created.

Thus, a blockchain becomes longer and longer as more data is created and stored. This means that the entire history of transactions can be tracked. In addition to performance, the distribution over several blockchains ensures more security, as all blockchains would have to be changed simultaneously in the event of manipulation.

This brings us to the next advantage. The programmers define who or which groups are allowed to see which data. Any groups can be created that are allowed to see different data, e.g. manufacturer, processor, central purchasing, dealer, customer, associations or government agencies such as customs.

Let's take the example of the food industry using the FoodTrust solution based on IBM's Hyperledger Fabric. For any product, such as coffee or perishables, you can either load all relevant data directly into the respective data record on the blockchain or add data in connection with third-party systems such as SAP.

This can be a date on which certain process steps were carried out, raw materials, temperature conditions during storage and transport, or documents such as certificates and clearance certificates. In this way, every step can be actively tracked and data can be stored in the respective systems such as SAP. Appropriate processes can also be started in the event of deviations from the target.

At the end of the process chain is the customer, who scans the QR code at the shelf or directly on the product, for example, and can read out the product information relevant to him. This increases the customer's certainty of purchasing fresh, authentic and original food and can support him with (up-to-date) additional information. Manufacturers and retailers can increase their efficiency, reduce losses and improve their own ecosystem through the data obtained. By incorporating certificates and documents, information management is optimized and counterfeiting is made more difficult.

If the blockchain is read out, irregularities or a lack of plausibility can be detected. For example, that more products were purchased than the respective manufacturer can actually produce. This data can also be used to optimize the supply chain in the future.

Examples are better compliance with the cold chain, shorter storage times or optimized transport options. A blockchain is also ideal for proving compliance with standards, for example to the authorities. Onboarding new business partners and new rules is also made easy with such a solution.

Examples are so-called smart contracts, which are connected via predefined business rules and conditions. These rules are typically only visible to the business partners involved and therefore run in so-called private channels. Once introduced, such systems can be expanded at will. Also due to the low costs, I assume that such systems will become established in all areas of the B2B and B2C environment.