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SMT007-Aug2020

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AUGUST 2020 I SMT007 MAGAZINE 13 example, or the status of those different events, you would go to the blockchain to reconstruct the history of what happened. We are not replacing the existing business systems; we are adding a layer of connectivity through the way they relate to each other from the point of view of a single transaction. Johnson: Does blockchain in the supply chain require head-to-tail use, all at once, to be effec- tive? Begue: No. For most of our cases, we focus on one particular aspect, such as international ship- ping or data exchange. You focus where it makes more sense to you. The start- ing point is there are multi- ple parties, and they work together in some ways; there is some sort of inefficiency in that process. Another assumption is that if I could view these set of transactions as they relate to each other, it would help me either sim- plify or go faster, and remove inefficiency. Where do I want to focus? Maybe it's invoice reconciliation, international shipping or customs declara- tion. You start there. Lam: I don't view blockchain differently from any other emerging technology. It's almost like all other data-related projects or analytical data proj- ects; they all need to have data input into a certain platform and layer, and that depends on the pain point you want to solve in your business. You further figure out how to utilize the data that you put into that platform and monetize it, or apply it to solve your problem. The only one that's additionally important is the specific need to have more than one party input the data. Otherwise, you really don't need that technology because the point of it is to improve security and then increase trust between the entities that are part of the stake- holder of that problem you're trying to solve. ous answer is that I have a supplier organiza- tion and a buying organization, but there are probably four or five other institutions or orga- nizations involved. I would have the supplier freight forwarder, a transportation agency— maybe FedEx or an airline—and maybe a cus- toms agency in China. I would have another customs agency in the U.S., possibly another freight forwarder in the U.S., and then one or two more logistic companies. They all see part of that simple supply chain transaction. You could reconstruct the life of that transaction for all the different parties. There is an electronic or paper-based set of transactions, but there is not a single system where, if you wanted to see the history of a simple sup- ply buy transaction, you could see all these differ- ent parties coming together. If you look at the extended supply chain—with all the outsourcing, contract man- ufacturing, complex sub- assemblies, and so on— the electronics industry is full of these very complex multi-party processes. There is no SAP system for that. Each one has its own set of transaction systems, but it doesn't amount to the entire end-to-end solution. With blockchain, we're trying to build that cross-participant, multi-party view of every connection in the transaction. Johnson: What happens if the blockchain con- tinuity through the supply chain is interrupted? Begue: The blockchain is going to be the record; it's not necessarily where you're going to ini- tiate the transaction. If a freight forwarder is contacting FedEx or is working with a customs agency in Shenzhen, China, they will continue to use their existing ERP or other logistics sys- tem to initiate that transaction, but it would be recorded on the blockchain. If you are in the U.S. and want to see where my stuff is, for Christophe Begue

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