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© 2017 BM Corporation 1 #IBMBlockchain Future of Automotive Supply Chain Senthil Virthachalam IBM Global Automotive Center of Competence

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Page 1: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation1 #IBMBlockchain

Future of Automotive Supply Chain Senthil VirthachalamIBM Global Automotive Center of Competence

Page 2: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation2 #IBMBlockchain

Introduction

Senthil Virthachalam Senior Managing ConsultantIBM, Global Business [email protected]+1 248 635 2810

Over 20 years of experience in automotive. My industry experience includes most of global automotive OEMs, Tier I suppliers, electronics and high-tech. My previous work experience includes program management at Tenneco Inc., supplier management, product development at Daimler Chrysler and product development at AshokLeyland (India). I graduated from Michigan State (MBA) and National Institute of technology (Engineering)

Page 3: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation3 #IBMBlockchain

Agenda

§Supply Chain Future POV

§What is Blockchain?

§Use Cases

§Q&A

Page 4: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation4 #IBMBlockchain

What is Blockchain?

Page 5: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation5 #IBMBlockchain

Blockchain is…

with shared business

processes

a trusted, distributed ledger

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© 2017 BM Corporation6 #IBMBlockchain

… inefficient, expensive, vulnerable, lack of transparency

Problem with business networks today

Party C’s records

Auditor records

Party B’s records

Party D’s records

Bank records

Party A’s records

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© 2017 BM Corporation7 #IBMBlockchain

Party C’s records

Auditor records

Party B’s records

Party D’s records

Bank records

Party A’s records

Blockchain

distributed control, shared business process, single source of truth

Solution with shared, replicated, permissioned ledger

Page 8: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation8 #IBMBlockchain

Shared Business Processes

§ Add control and visibility to shared processes

§ Automate network interactions

§ Participate directly with network members

Page 9: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation9 #IBMBlockchain

Shared system of record. Permissioned

access within own network.

Immutable & Traceable

Business terms embedded in transaction database & executed with transactions

All parties agree to network verified transaction by Consensus

Ensures appropriate visibility; transactions are

secure, authenticated & verifiable

Smart contract

Privacy Trust

Shared ledger

Key concepts of Blockchain

Page 10: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation10 #IBMBlockchain

Savetime

Removecost

Createtransparency

Reducerisk

Transaction processing from days to near instantaneous

Overheads and cost intermediaries

Access to data among all

participants

Tampering, fraud & cyber crime

Blockchain benefits

Page 11: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation11 #IBMBlockchain

IBM is collaborating to transform fundamental business processes across industries

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To enable multiple parties to work together leveraging permissions and identity, to ensure data and transactions are protected and consistent

Open

Trusted

For Business

Blockchain must be built on robust technology environments providing security, confidentiality, auditability, reliability and scalability

Fundamental industry technologies, processes and communities need Open source, Open governance, Open ecosystems

IBM Blockchain Vision

Core Principles

Page 12: Blockchain Supply Chain - UMTRI · global trade solution based on Blockchain ... 90% of goods in global trade are carried by the ocean shipping industry each year. But global supply

© 2017 BM Corporation12 #IBMBlockchain

§ Linux Foundation project announced December 2015 with 17 founders

§ The Hyperledger Project is a collaborative effort to advance Blockchain technology by identifying and addressing important features for a cross-industry open standard for distributed ledgers that transform the way business transactions are conducted globally

§ Open source and open standards-based

Enable adoption of shared ledger technology at a pace and depth not achievable by any one company or industry

QUICK FACTSCompanies in Announcement: 17

Now 120+

Inquiries to Join

2,3005x more than largest in history

It takes a Community: Hyperledger Project

https://www.hyperledger.org/projects

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© 2017 BM Corporation13 #IBMBlockchain

Hyperledger Project Members

Source: https://www.hyperledger.org/about/membersUpdated June 2017

Premier General

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© 2017 BM Corporation14 #IBMBlockchain

Use Cases

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© 2017 BM Corporation15 #IBMBlockchain

Maersk and IBM announceglobal trade solution basedon Blockchain

http://www-03.ibm.com/press/us/en/pressrelease/51712.wss

90% of goods in global trade are carried by the ocean shipping industry each year.

But global supply chains are plagued by inefficiencies caused primarily by:• ineffective information sharing across organizational

boundaries• Manual, paper-based processes

https://www.youtube.com/watch?v=dcddYatMCGQ

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© 2017 BM Corporation16 #IBMBlockchain

Global Trade Digitization Network

An open, extensible platform for sharing shipping events, messages, and documents across all the actors and systems in the supply chain ecosystem.

Important principles• Detailed information remains under the control of the owner• As neutral as the Internet• Fault tolerant• Everyone can work in their own systems

Provider of interface: value-add partners

Event publishers & subscribers

GTDPlatform

Customs Dashboard

Logistic actors internal systems

Supply Chain Visibility systems

Port community systems

Transportation management.

Shippers

Authorities

Trade Associations

Carriers

Supply Chain Actors

Terminals

Supply Chain Management

Maersk collaboration video

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© 2017 BM Corporation17 #IBMBlockchain

How to accelerate traceability from weeks to minutes/seconds?

Walmart & IBM collaborate on Food Safety, traceability & transparency

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© 2017 BM Corporation18 #IBMBlockchain

PorkScalability

MangoNetwork Breadth

https://www-03.ibm.com/press/us/en/pressrelease/50816.wss https://youtu.be/MMOF0G_2H0A?t=6m3s

Walmart & IBM are working on 2 pilots in China and USA

Walmart collaboration video

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© 2017 BM Corporation19 #IBMBlockchain

Boschand IBMdevelop ParcelChain Proofof Concept

BasedonHyperledger–Opensourceandopenstandards-based–Modularandscalablearchitecture–Permissioned–Performant–Privacy&confidentialityassured

Advantages– Transparencyonproductlogistics–Potentialcostsavings– Improvedfakedetectiongranularity– Identificationofgraymarketimports– Extensibletootherbusinesscases

Blockchain Nodes

Bosch IoTCloud

Data CenterBosch

Public CloudDistr.A

DataCenterDistr.B

PublicCloudLogistic

Transactions

Description Parcel

ContainerID _cont_12345

Product ID _bosch_part12345

ProdDate 01.10.201614:45:22

Origin China

Destination DistributorA–Lissbon

Blockchain Ledger

Block1#0155fa4bee112ce467398

H

HashFunction

Ledger

CI/AD | 02/13/2017© Robert Bosch GmbH 2016. All rights reserved, also regarding any disposal, exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.

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© 2017 BM Corporation20 #IBMBlockchain

https://youtu.be/jY8HFRs6Y4s?t=17m32s

Bosch collaboration video

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© 2017 BM Corporation21 #IBMBlockchain

Q&A