How is DP World using blockchain to optimise supply chain?
Jayakrishna Alwar, Senior Software Development Engineer
While COVID-19 showed us how vital the global supply chain is for the world economy and our day-to-day life, it also exposed us to the fragility of the supply chain. It could take over 10 organisations across different industry segments to move a shipment from origin to destination, including importers, exporters, carriers, warehouses, custom authorities, and port operators. These organisations vary significantly in size, credibility and technological sophistication, creating data and communication challenges for the beneficiary cargo owners.
Despite continuous technology advances and business process improvements, today's supply chains are too complicated and broken in many ways. Inconsistent information across organisational boundaries and blind spots throughout the supply chain hinder the efficient flow of goods. Shipments are delayed, damaged, or lost too often because of the confusion in the chain of custody. Let’s take a look at some more problems that come with this broken supply chain:
- Complex, cumbersome, and costly peer-to-peer messaging.
- Manual, time-consuming, paper-based data collection and verification processes. It is difficult to trace the edit history and reasons behind doing them on documents. Processing and administration costs have also risen to 20% of overall transportation costs.
- Lack of sufficient information to assess risks and expedite the clearance processes. It can be tough to investigate illegal or unethical practices when enough information is not available.
- Lack of reliable visibility into the logistics milestones. It is challenging for the customers to gain valid information on the context, location, timing, and condition of their shipments and make informed business decisions.
DP World is a leading enabler of global trade and one of the world’s premier data-driven smart logistics service providers. We at DP World are adopting distributed ledger technology (blockchain) to solve the above problems mentioned above. Our goal is to create trust among the business partners and optimise the value chain, through enhanced security and distributed and immutable nature, with the following three solutions.
1. Secure and tamper-evident data sharing
This solution enables one organisation to securely share data, including shipping documents, with other organisations in the private blockchain network. The process takes place in near real-time and tracks all the changes as revisions on a distributed ledger, saving time and effort in peer-to-peer messaging. Additionally, the use of digital signatures ensures that the data is authentic and verifiable.
2. Product provenance
We can track every shipping milestone event, from the origin to the destination, with this feature. All the blockchain network participants see the same tracing history along the timeline as a single source of truth from the immutable distributed ledger.
3. Digital asset tracking
Through this solution, documents of title can be turned into digital assets on the immutable ledger to track the changes in ownership along its lifecycle. This enables transparency through a verifiable and auditable document history.
For example, the Bill of Lading (BOL) cargo document changes multiple hands, starting from the carrier to the importer. Many parties mean much chaos. Digitalising such documents and tracking the changes on an immutable ledger would give all these parties visibility into the lifecycle in an auditable and streamlined manner. The below swim lane diagram shows a glimpse into the lifecycle of the BOL document.
State transition flow for the BOL document shows the document’s ownership transfer from the carrier to the importer.
Blockchain-based solutions are the best fit for problems involving multiple untrusted parties willing to come together to form a consortium for the use cases. However, there are various barriers to adopting this technology. These include the complexity involved in setting up the infrastructure for blockchain nodes, having the technical know-how on distributed communication and the associated costs.
In the upcoming articles, we will discuss the technological platform that DP World created for the trade logistics community, powered by Hyperledger Fabric. This modular blockchain framework enables secure, transparent and trustful data sharing among cross-border trading partners and their logistics service providers. Stay tuned!
Technology at DP World is the powerhouse of tech innovations in India. We aim at revolutionising technology in the world of logistics and trade. We invest in new technologies and disruptive innovation, always seeking the edge to lead the future in world trade.
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