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If there were an award for the most revolutionary technology of the decade, blockchain technology would win for its sheer scope of application and for revolutionizing data management and recording. It has been touted as an invention almost as significant as the internet itself.
Blockchain technology gained its reputation mainly because of the colossal rise in the popularity of the cryptocurrency, Bitcoin, which spawned a whole new class of digital assets. Blockchain technology is at the base of all these cryptocurrencies.
However, there is more to the technology than just cryptocurrencies and it is absolutely mind boggling as to how quickly this technology is assuming a role of importance in many areas of the global economy. With every passing day, more and more corporations and individuals are realizing the worth of its awesome capabilities and are investing in this technology in one way or the other.
Blockchain technology explained in general terms is that it is a way of recording data in an immutable manner in a decentralized and democratic network of computers. It ensures the permanency and authenticity of the data, which means that any data recorded on the blockchain becomes permanent in the truest sense and that the data hasn’t been manipulated and falsely recorded. Also, blockchain technology brings a vast scope of applications with it. From simple record keeping to identity management to facilitating funding, this technology can be applied to almost all aspects of human endeavor.
Large-scale applications of blockchain technology are being developed for many sectors and industries, which could do away with the obsolete manner of record management which primarily uses a central database stored in a server requiring additional layers of encryption which can still be hacked and tampered with, along with the possibility of data theft and loss due to mechanical difficulties or errors.
The blockchain in manufacturing market is expected to be worth USD 30.0 million by 2020 and USD 566.2 million by 2025, growing at a CAGR of 80.0% from 2020 to 2025.
The one manufacturing area that could immensely benefit from blockchain technology is supply chain management, with its endless line of paperwork and continuous auditing and tracking. The chain of custody of both raw materials and the finished products is handled through supply chain management which involves the use of a lot of workforce to handle the work in progress, track the finished products, prepare the necessary documents, ensure timely payments, and whatnot.
Supply chain management is a vital function of modern management which ensures the generation and transfer of value in the form of goods in the global market to enable competitiveness and survival. Blockchain technology can be integrated into the supply chain management, reducing errors and faults. A blockchain-powered platform can involve all parties in the supply chain. The specifications of the raw materials sent by the supplier can be recorded on the blockchain, which can be directly viewed by the manufacturer as soon as it is recorded. The manufacturer can cross-check all the details upon receiving the raw materials to ensure that the correct type of goods have been sent and there hasn’t been any loss during the transit.
The blockchain can also incorporate intelligent contracts, which would make the payments almost instantaneous as soon as the manufacturer records the receipt of the goods on the blockchain. Tracking the goods through blockchain supply chain will become more accessible, and the need for physical updating will be reduced to a bare minimum. Blockchain will reduce the repetitive nature of the activities that must be performed, and it will most definitely lead to cost benefits for all the parties involved.
Companies are moving toward adopting blockchain and IoT as these technologies can enable real-time data analyses, detect the movement of high-value equipment, quickly deploy solutions, and monitor customer purchase behavior. These solutions also provide product manufacturing and leasing companies business insights to assess the performance of their equipment and compare product usage across various regions. Moreover, real-time analytics tools help align to dynamically changing industrial equipment requirements.
One other avenue of manufacturing that has gained a lot of traction in recent times is 3D printing. 3D printing is an excellent way of manufacturing products using a ‘printer’ which prints the product with all three dimensions, layer by layer, based on the design uploaded on the computer. Blockchain technology can ensure robust IP rights protection. It can also protect the design from being tampered with and provide access to only authorized devices (3D printers) and individuals. The 3D file can be sent through smart contracts to the authorized printer, and printing can be done without the need for manual intermediaries in the process or involving the threat of intellectual property theft.
The technology can also help deploy what is known as “distributed manufacturing,” a type of decentralized manufacturing in which geographically disparate manufacturing facilities are connected and coordinated through an IT infrastructure on the blockchain.
The internet of things (IoT) has been around for a while now. The idea of connecting all the devices/machines to enable smooth and quick information sharing among the machines to facilitate seamless production and reduce wastage of time is roughly what the internet of things is about. Experts in the manufacturing industry believe IoT technology can significantly impact the sector. However, there are still a few associated with the IoT, including identification problems of the IoT devices and the scalability of the same. Blockchain technology can play a significant role in driving IoT in manufacturing.
All the devices or machines can be registered on the blockchain so that a digital identity of the devices can be created, and the need to verify them will be eliminated. The information regarding the devices on the blockchain could then be sent to all the involved parties to ensure complete transparency and verification of manufacturing information. It will also enable dynamic updating of information on the devices without re-integrating them into the IoT.
These are only some of how blockchain technology can transform the manufacturing industry. The true potential of this technology is still being unearthed, with newer applications being introduced to streamline the sector's processes.
Challenges, however, remain, like a lack of awareness about uses of blockchain technology and it’s potential among manufacturers, concerns regarding security, privacy, control, inconsistent business semantics and conflicts related to data ownership, and, more importantly, an uncertain regulatory landscape and the absence of a common set of standards. That does not stop innovators from developing blockchain-powered solutions within the manufacturing sector to improve efficiencies.
If you wish to understand how this revolutionary technology can help transform your business, contact an expert blockchain development company like 500x Tech Labs today.