Just four years ago, the mere mention of the word blockchain could spark an endless conversation. Blockchain is a distributed ledger technology where blocks (records) are added, transaction data is captured, and timestamps remain. A timestamp is proof that a transaction took place and indicates when a block was created. 2018 saw the formation of the Food Trust Group, the world’s largest cluster of food companies, including Walmart Inc., Nestlé SA, Dole Food Co., Golden State Foods, Kroger Co and Driscoll’s Inc. The goal was to use blockchain to improve recalls, identify stubborn bottlenecks in real time, and improve the overall customer experience.
At the time, major players in various industries were using blockchain, excited by its ability to eliminate the costly middle layer and its apparent impossibility of manipulation or counterfeiting. IBM and Walmart are most famous for working together to track agricultural products via blockchain. The two decided on leafy greens as a starting point, but only his one item (bell peppers) was added four years later. The technology that was trying to revolutionize his chain of supplies has stalled. What is behind the delay?
Gartner Inc., a consulting and technology research firm, has a theory, and it’s not overly complicated. In other words, most companies rely on a large number of partners who need a common “operating language.” Many non-Fortune 500 companies are reluctant to adopt blockchain due to its complexity and cost. AP Moller-Maersk A/S knows this very well. Also working with IBM, Maersk said in 2018 he launched TradeLens, a global tracking platform that has finally digitized container shipping. But like any new system, the success of TradeLens hinged on cooperation between Maersk partners and many countries. Since this never happened, Maersk plans to scrap the platform by the end of the first quarter of 2023.
At this point, blockchain should become simpler and more affordable. The learning curve is steep, especially for companies that rely on small and medium-sized suppliers who aren’t necessarily tech-savvy. Back at Walmart, many of its partners are producers and farmers, and blockchain is outside their scope for now. For example, the state of Jharkhand in eastern India is using blockchain to track the distribution of seed sales to farmers. The chain only tracks seeds that come directly from the state, and the process is pretty straightforward.
Part of the incentive to use the chain, however, is that farmers want the seeds and are more willing to participate. Perhaps we need better incentives.