By Muhammad Saad Sajid
Block chain originated on the dark web, where those who wanted to conduct transactions in complete anonymity used crypto currency. During its early phases, block chain had a bad reputation. Block chain technology now has the ability to alter the dynamics of all major businesses throughout the world, including supply chain management.
When two parties commence a transaction, the block chain gives them an encryption, then verifies the transaction and creates a block, which is then added to the block chain. Finally, the transaction is completed and the ledger is updated.
A ledger is essentially a collection of data blocks, thus when some of them are combined, they constitute a ledger. Every user involved in the transaction has access to the complete collection of data, which cannot be changed until the majority agrees, making the entire process decentralized.
The ability to move large amounts of data saves money and time because it eliminates the need for intermediaries such as accountants, lawyers, or paperwork because all participants use a common ledger to gain access to the data, which is also un-hackable because it takes a majority to change the data.
The common ledger creates more transparency Because everyone engaged has access to information, they can trace consignments, every transaction is recorded, security is not compromised, and supply chain managers can see where their items are in the supply chain process, there is increased collaboration at every level of the process. Assets such as inventory units, orders, loans, and bills of shipping are assigned unique IDs that serve as digital tokens when block chain record keeping is implemented.
With the induction of block chain technology regular supply chain management can easily be converted into global supply chain management because it creates a more secure and transparent information pathway from a shipments origin to its destination as it is widely applicable to many problems in the supply chain management industry because the inventory flows, inventory flows and financial flows are included in the ledger.
The use of block chain in the supply chain industry means faster processes, lower transaction costs, and more secure and reliable data exchanges with no intervention from previously involved third parties; this is why major corporations such as IBM, FedEx, Wall Mart, Ford, and UPS are incorporating block chain technology into their operations.
As the world grows more globalized, many firms will continue to acquire their raw materials and products from diverse regions of the globe, and block chain may one day become a catalyst for global supply chain operations.
Pakistan must develop trade policies and strategic frameworks that are aligned with emerging technologies. For example, by incorporating block chain technology into Pakistan’s supply chain practices, there will be fewer restrictions between partners, resulting in shorter lead times, fewer redundancies, fewer delays, and less red tape. Pakistan will be able to attract the attention of numerous markets throughout the world with a fast-paced supply chain network, resulting in increased economic success for Pakistan.
Pakistan must invest heavily in researching and implementing new technologies; in the case of block chain technology, more research and regulations are required before it can be properly integrated into supply chain management systems in Pakistan; however, industries that rely heavily on a strong supply chain network in Pakistan will undoubtedly benefit and improve their performance and operations. Block chain technology will definitely be adopted by a variety of enterprises in Pakistan, but the country must accelerate the process and take steps to ensure that commercial activities are conducted in a timely and effective manner both domestically and internationally.
These emerging technologies have the potential to change the way various businesses operate in Pakistan, the government and business community should research and implement block chain technology in their respective supply chain management systems as soon as possible. This will give Pakistan a competitive advantage over its global competitors.