Internet of Things (IoT) and Blockchain Essay Example

Introduction

Supply chain describes all the links found within the development and distribution of the product from the raw materials to the end products which exist in possession of the customers. Presently, supply chains consist of numerous phases and heaps of geographical locations, making the tracking of events to be hard. The customers find it difficult to determine the origin of the services and products they buy come from so that the amount of money paid for the goods and services offered do not replicate the value of manufacture. Additionally, with the lack of transparency in supply chains, it becomes difficult to hold people accountable for the illegal things that happened along the supply chains. Thereby, showing the reasons why there are numerous cases of forced labor, and scam that makes numerous involved organizations to lose more money. However, with the existence of the current technology inform of the Internet of Things and Blockchain, most organizations have benefited a lot by improving supply chains.

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Supply Chain management risks

Numerous challenges have been experienced by various organizations due to the supply chains. One of the major challenges that have been created to the organizations is that the industries find it difficult to manage the abrupt organizational changes that are made through information flow (Sikorski, Haughton, & Kraft, 2017). This occurs since the organizations to not apply transparency throughout the supply chains when they when they outsource for the commercial leverages. Additionally, since the organizations do not have end-to-end reflectiveness, they are likely to experience fraud and violations of the conduct codes which in turn affects the general performance of the organizations.

The improved tools of supply chain management are at times seen as challenges to the organizations since they require more investments in continuous processes. Another existing issue created by the supply chains within organizations is the ripple effect. The ripple effect occurs as a result of the supply chain expansion which later leads to the problems of variability. This risk is majorly created by the suppliers, distributors, clients, and the entire management of the organizations (Vermesan et al., 2017). This also indicates that there is no trust between the stakeholders, distributors and the customers of the organization since true information is not communicated.

Significance for the Internet of Things (IoT) and blockchain Application for supply chain management

Internet of Things (IoT) and blockchain are some of the new technologies that have since impacted the performance of various organizations in the present world of business. Blockchain describes the system by which the distributed ledgers are maintained with a demand for features such as cooperation in a safe fashion, traceability, and auditability (Saberi et al., 2018). IoT is currently viewed as a network of intellectual, physical substances and things that are capable of network connection to have the capability of sending and receiving information. Some of the primary application cases of the Internet of Things (IoT) consists of extrapolative maintenance of assets, checking of plant operations and fleet observation. Both internets of Things and Blockchain can be of importance within the Universe of supply chain whereby, they would be of use to the producers, logistic service suppliers, and providers.

A combination of both Internets of Things and Blockchain is important in improving worldwide supply chain funding. Worldwide supply chains consist of cross-border trades which demand bureaucracy and large works. This, therefore, develops a substantial effect on the period taken for international payments, since numerous parties are involved and are also seen to be the focus of the local banking rules (English, Auer & Domingue, 2016). Payment clearings can at times delay due to duplicate invoices. However, the combination of the Internet of Things and Blockchain can increase the pace at which the products are moved across the borders, thus promoting cheaper and secure businesses that avert fraud via the provision of a distributed register that is difficult to manipulate (Korpela, Hallikas & Dahlberg, 2017). The action is advanced in blockchain through the application of small charts that act as the computer programs whereby, the terms of the agreement between the involved individuals are programmed and executed

The combination of the Internet of Things (IoT) and Blockchain also regulate the reliability of the supply chains. In most regulated organizations, the transportation of the products to different locations needs to be conducted in with firmly precise temperatures ranges. The providers and producers of such organizations should be able to offer an indication of adherence to the intervals (Kuzmin, 2017). However, when they fail to comply, it can lead to their transported products to be seized for investigations. Capturing of the temperature feeds from the sensors has since become possible whereby, they can be transmitted to the Internet of Things platform. The structure of the blockchain is imperative since it promotes the consistency and security of the data that has been captured (Figorilli et al., 2018). The combination would also become of importance to the suppliers especially in small contracts since they will be able to obtain the agreement conditions.

Internet of Things and Blockchain are also important to the supply chains since they promote secure sharing of information between the partners within the ecosystem of supply chains. Investors can apply the advanced machine-acquired skills on the general dataset, frequently in a grouping with data sources, to develop innovative insights through the supply chains (Christidis & Devetsikiotis, 2016). This shows that both the Internet of Things and Blockchain can be applied together to help solve some of the primary issues that are experienced in supply chains in the present world. Once the problems have been solved, it will create value for the organizations that are involved in productions (Zheng et al., 2016). Additionally, the application of the Internet of Things and Blockchain are important since they increase the production rate of the organizations. Internet of Things and Blockchains are also crucial in supply chains management since they promote the reduction of the costs encountered by the companies (Bahga & Madisetti, 2016). This indicates that with the application of the Internet of Things and Blockchains, industries do not have to use the middlemen but instead involve their partners which therefore reduces the cost of production and marketing.

Conclusion

Conclusively, the emergence of new technology has assisted various organizations in supply chains management. Internet of Things and Blockchains have currently been used by organizations to promote effective supply chain management. Companies can now create networks with other organizations and make effective progress in manufacturing. In other words, the Internet of Things and Blockchains are believed to be connected since they both promote tracking of the business operations. Fraud which has been a major issue affecting companies has now been solved through the use of Internet of Things and Blockchains since organizations can now verify the flow of the products from the providers by implementing high control. Additionally, the Internet of Things and Blockchains have become of importance to the organizations since they speed up the processes used by the organizations in transporting goods and receiving payments.

References

Bahga, A., & Madisetti, V. K. (2016). Blockchain platform for industrial internet of things. Journal of Software Engineering and Applications, 9(10), 533.

Christidis, K., & Devetsikiotis, M. (2016). Blockchains and smart contracts for the internet of things. Ieee Access, 4, 2292-2303.

English, M., Auer, S., & Domingue, J. (2016, May). Block chain technologies & the semantic web: a framework for symbiotic development. In Computer Science Conference for University of Bonn Students, J. Lehmann, H. Thakkar, L. Halilaj, and R. Asmat, Eds (pp. 47-61).

Figorilli, S., Antonucci, F., Costa, C., Pallottino, F., Raso, L., Castiglione, M., & Sperandio, G. (2018). A Blockchain Implementation Prototype for the Electronic Open Source Traceability of Wood along the Whole Supply Chain. Sensors, 18(9), 3133.

Korpela, K., Hallikas, J., & Dahlberg, T. (2017, January). Digital supply chain transformation toward blockchain integration. In Proceedings of the 50th Hawaii international conference on system sciences.

Kuzmin, A. (2017, November). Blockchain-based structures for a secure and operate IoT. In the Internet of Things Business Models, Users, and Networks, 2017 (pp. 1-7). IEEE.

Saberi, S., Kouhizadeh, M., Sarkis, J., & Shen, L. (2018). Blockchain technology and its relationships to sustainable supply chain management. International Journal of Production Research, 1-19.

Sikorski, J. J., Haughton, J., & Kraft, M. (2017). Blockchain technology in the chemical industry: Machine-to-machine electricity market. Applied Energy, 195, 234-246.

Vermesan, O., Eisenhauer, M., Sundmaeker, H., Guillemin, P., Serrano, M., Tragos, E. Z., & Bahr, R. (2017). Internet of things cognitive transformation technology research trends and applications. Cognitive Hyperconnected Digital Transformation: Internet of Things Intelligence Evolution.

Zheng, Z., Xie, S., Dai, H. N., & Wang, H. (2016). Blockchain challenges and opportunities: A survey. International Journal of Web and Grid Services, 1, 1-25.