- The Ivey Academy
- Apr 13, 2018
The blockchain – as defined by Ivey’s Crypto Capitalism Centre – is a "decentralized public ledger that maintains a transaction history and represents a ‘single source of truth’ shared by all the network users. The first real-world application of blockchain technology, the decentralized cryptocurrency bitcoin, is powered by a special type of blockchain that is append-only (i.e. past transactions cannot be modified), permissionless (i.e. anyone can join), and transparent (i.e. anyone can examine the entire transaction history). Note that blockchain technology can be used for other applications, independently of the bitcoin currency.”
Indeed, blockchain technology has many uses and forward-thinking businesses are already extracting value from its versatile nature. Below are a few examples of how industries and sectors are using blockchain technology to improve the experience of their customers and stakeholders.
Point-of-sale debit or credit transactions require a third-party to clear and settle each transaction. The blockchain excludes the need for third parties, reducing human error, fraud, and – most importantly – transaction fees paid to intermediaries for their clearing and settling services. All financial transactions recorded on a blockchain cannot be altered and are able to be audited at any time.
Carrefour SA, a French grocery chain, has combined barcode technology with blockchain technology to allow customers to access information about every chicken it sells. Carrefour’s software provides a unique “life story” to consumers – information on each chicken can include its specific diet, whether it was raised on a free-range farm or not, and its overall health. By making this information available to socially and health-conscious customers, Carrefour SA has created a significant competitive advantage over other grocery chains.
As businesses scale-up and expand globally, payroll managers are finding it increasingly costly to send money overseas and pay employees in their preferred currencies. Cross-border payments can prove to be frustrating for employees due in large part to third-party payment processing delays and international banks that operate under different rules. Blockchain technology simplifies processes by eliminating intermediaries, allowing employees to be paid in a timely fashion. Blockchain-based payroll systems allow companies to pay employees, contractors, and vendors in their preferred currency using the bitcoin exchange rate.
Human resources professionals spend a considerable amount of time verifying the identities, employment histories, and references of job candidates. The use of blockchain technology can make it easier to spot fraud in candidate credentials by substantially increasing transparency – and increasing the efficiency of the HR function.
It was widely reported that Sierra Leone was the first nation to use blockchain to power its election. While Sierra Leone’s electoral commission pushed back on reports that it employed blockchain technology, the fact remains that recording votes on a publicly accessible ledger improves electoral efficiency, ensures voting integrity, and could eliminate costly recounts and disputes.
The World Bank estimates that 70 per cent of the world’s population lacks access to land titling. Last year Sweden’s government began recording property transactions on a blockchain to combat this problem. The blockchain-enabled solution could save Swedish taxpayers $155 million when fully-implemented by streamlining transactions, reducing fraud, and eliminating paperwork.
The Brazilian government is currently using the ethereum blockchain to verify petition signatures before they are adopted by legislators. Before the adoption of blockchain technology, petitions with as many as 145 million hand-written signatures had to be verified manually.
Food & beverage
Last year Walmart announced a partnership with IBM to utilize blockchain technology in tracking the safety, origin, and authenticity of its food and beverage offerings. Tracing the origin of food used to take Walmart between one and two weeks. With the blockchain, the task is carried out in two seconds. This means that food-borne disease outbreaks such as E. Coli, H2N2, and listeria can be contained immediately.
Data hosted by third parties – also known as “the cloud” – can be subject to breach. Famous examples of hacked third-party data include 3 billion Yahoo user accounts being compromised, Equifax’s inability to keep the social security numbers of 209,000 customers safe, and the celebrity photo leak that exposed the vulnerability of Apple’s iCloud service.
Files stored on a blockchain do not reside in a single physical location and are only accessible by those persons owning an encryption key. As a result, there is no risk of data theft or reputation-damaging leaks when data is stored on a blockchain.
While blockchain technology is still in its infancy, it represents a tremendous opportunity for early-adopting organizations. It has the potential to not only transform the banking industry, but every organization where the customer experience is critical to its success. Not all businesses may be ready to adopt blockchain technology, but the development of financial technologies opens the door for a new way of thinking about the problems they face.
Our two-day Mastering FinTech: Strategies for the Future program will help you to assess whether financial technologies – such as blockchain – are disruptors or enablers for your industry and business, and how to formulate strategies to thrive in the new digital world. Program participants learn how to leverage technology assets to protect themselves from disruption while strategically forming partnerships to offer their customers a superior customer experience at lower cost. For more information, download the Mastering FinTech: Strategies for the Future brochure.
The Ivey Academy is the Financial Times #1 ranked provider of management development programs in Canada. The Open-Enrolment portfolio comprises 19 programs focused on core leadership, business acumen, and industry-specific skills. Open programs are typically three days to three weeks in length, and are held at both our Toronto and London campuses. Our Custom Academy business unit works with corporations, governments, and other NGOs and non-profits to design and execute development and training programs tailored to the client’s specific needs. Custom Academy programs are typically multi-cohort, multi-year endeavours, supporting executive, HR and L&D objectives, and run either at our Toronto and London campuses or globally based on client preference. All Ivey Academy programs are deeply experiential in nature, concentrating as much on behaviour change as knowledge transfer.