There’s an old piece of stock market wisdom that says: “they don’t ring a bell at the top or bottom of a market”. In other words, make your own judgement about the right time to make a move.
There is a risk in 2019 that some enterprises will fail to look beyond the hype and skepticism about blockchain and Distributed Ledger Technology (DLT) and conclude there is “nothing to see here” and miss the opportunity to achieve meaningful benefits.
It wouldn’t be a surprise – because of all the hype – but it would be a mistake. Now is the moment when your competitors are gearing up or moving towards genuine blockchain use cases. And, as both businesses and their technology suppliers gain valuable experience, the success rate for deployments will increase at the same rate too.
As Fujitsu has always predicted, what’s enabling this forward momentum is a new, pragmatic emphasis on leveraging blockchain and other DLTs to optimize efficiency and use it in those business processes where it makes sense. That means we’re likely to see the technology applied as part of a wider-reaching optimization of processes – particularly in the supply chain – rather than in more radical ways.
This comes across clearly during the many conversations we are having with customers. They are really starting to understand that the underlying technical principles and discussions today are, as they should be, 80 percent about business benefits and only 20 percent about the actual technology stack.
Blockchain as-a-service platforms
Another fundamental difference is the support now available to enterprises from Fujitsu for blockchain-as-a-service platforms and proof of business rapid-prototyping frameworks. Unless you are working in a greenfield situation, which is highly unlikely for existing businesses, blockchain and DLT solutions are currently a supplementary platform, not an end-to-end solution: integration with the existing business fabric is an obligation which was often ignored by the blockchain purists.
The new Fujitsu Flow suite of blockchain-as-a-service offerings is a practical example of how blockchain and DLT are ready to bring real benefits to businesses. The first offering in the suite is Fujitsu InvoiceFlow. This enables enterprises and government agencies to avoid – and frequently eliminate – the very real issue of accidental data error and the increasing problem of invoice fraud.
Procurement fraud is estimated to cost businesses in the UK alone some £127 billion a year, with the use of so-called “crime-as-a-service” gangs on the rise. Today, an invoice scam can be set up in less than a day, and cyber-criminals accept a percentage of the gains as their fee – a new way of looking at payment on results.
Fujitsu InvoiceFlow greatly reduces the threat of fraud by cryptographically joining a buyer’s purchase order, any related payments and all related invoice data from the seller, and doing this for the entire lifecycle of the account.
It’s easy to use – buyers and sellers can automate processes that prove invoices are genuine and reconcile them with sellers’ data. And it does not create a new island of technology – the cryptographic power of InvoiceFlow is integrated via REST APIs to standard Enterprise Resource Planning systems, such as SAP, Microsoft Dynamics and Oracle Financials.
This kind of integration with APIs is helping to lift blockchain into the mainstream of usable technology.
InvoiceFlow is the first in suite of as-a-service DLT platforms Fujitsu is currently launching. Watch this space for the next announcements. (If you would like to be notified via email, please contact us.)
In coming months, we are also going to see the further convergence of public and private blockchains, culminating in a move towards hybrid models whose existing systems are exposed via APIs. This will become more important than ever in 2019, with the rapid evolution of various blockchain frameworks and the increased drive towards standardization.
A suite of ready-to-use blockchain platforms
Looking further ahead, Fujitsu is taking a leading role in the development of truly smart DLT contracts – as opposed to pieces of code that just trigger a specific action if certain conditions are met.
True ‘smart’ contracts – where machine-to-machine data or transactions are automatically validated – require the use of data analytics and Artificial Intelligence prior to introducing data on to ledgers.
This is the only way to ensure accurate, validated data enters the ledger in the first place. Fujitsu is a global leader in both data analytics and AI, and is applying them to prepare, manage and automatically enforce elements of smart contracts.
If AI redefines the business engagement and blockchain resets how we treat matters of record, then together these technologies will realign and change organizational boundaries.
In our current world, we tend to think of vertical boundaries around an organization. The combination of AI and blockchain changes that model to a more horizontal alignment, where complex processes can operate more efficiently between organizations, releasing large amounts of currently trapped value in the process.
“No” is an answer too
It might be self-evident, but is worth stating, none-the-less, that often there are solutions that are more reasonable or smarter than using DLTs. We always point customers to the best option, which might be something other than blockchain, or recommend the use of blockchain only in steps where it makes sense.
However, we believe that there are business processes, or parts of processes where significant benefits are achievable today.
To stay relevant and compete, companies must face head-on and embrace the challenges set by digital transformation, while still operating cost-effectively and integrating with existing systems and solutions. Blockchain and ledger technology is one of the ‘tools’ to help face that challenge and even to get in front – if executed wisely, of course.