Cointelegraph (New York, USA)Insolar Technologies GmbH (Zug, Switzerland)

Empowering Supply Chain Digital Transformation with Distributed Ledgers

Date: November 12, 2019 Version: 1.0 Status: Approved for Private Dissemination Copyrights: Cointelegraph, Inc @ 2019

Outline1. Executive summary

2. Challenges in today’s supply chain process 2.1. Problem highlights

2.2. Why current technological solutions (ERPs, traditional databases, etc.) are unsuitable for contemporary supply chain issues

3. Solutions3.1. How emerging technologies will change the supply chain (IoT, AI, robotics, blockchain)3.2. Blockchain technology in detail. Key attributes of ready-to-implement enterprise blockchains3.3. Introduction to Insolar Blockchain Platform

4. Enterprise blockchain in action4.1. Over-the-counter trading and settlement. How a leading mining company can boost trade efficiency by 30%4.2. Paperless customs clearance. How an international manufacturer can streamline customs clearance4.3. Inbound supply chain predictability. How an international automotive company can improve inbound supply chain predictability4.4. Accounting productivity. How a large retailer can save >$100 in each

reconciliation4.5. Provenance tracking. How a leading automotive company tracks ethical and sustainable material sourcing

5. Providers and solutions breakdown5.1. Blockchain vs. a non-blockchain-based solution5.2. Blockchain usage overview

6. Blockchain adoption challenges7. Roadmap to implementing blockchain solutions

7.1. Approach of Cointelegraph consulting7.2. Approach of Insolar

8. Contacts9. References

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Executive summaryThis report has been prepared by a joint team of Cointelegraph Consulting and Insolar experts,who analyzed Business-to-Business (B2B) blockchain case studies at five leading international companies representing the automotive, retail, mining and manufacturing industries to assess today’s state of blockchain adoption in supply chains.

Key findingsCurrent processes are unable to provide the visibility and transparency required to trace goods throughout the supply chain, from origin to the point of sale. This exposes counter-parties to various costly risks such as late delivery, fraud, poor quality, accountability for environmental and social responsibilities, and lost sales.

Blockchain fitting into supply chains is agreed by the market. Blockchain is a shared, permissioned ledger of records used for data storage and enforced with a smart contract system, providing a new level of business process automation. Business benefits include:

ConclusionsDespite the significant investments made in IT by companies, their existing IT systems are not designed for multi-enterprise business network management, failing to provide visibility, trust between counterparties and data immutability.

Blockchain can extensively transform the physical product supply chain, with net cost savings of up to 0.8% of revenues.1

However, several challenges are preventing wider adoption of blockchain technology:

End-to-end connectivity between each stage of the supply chain, providing traceability across the production line

Immutability of data stored in blockchain enables instant regulatory compliance

Return-on-Investment uncertainty

Lack of legislation and standards

Lack of in-house capabilities, cultural and IT skills

Blockchain platforms ready for the supply chain have the following common traits:

High performance in terms of data processing speeds, which can be achieved via advanced data processing and storage techniques

Cost-effective data storage within the platform and keeping the storage decentralized

A team with extensive experience in building enterprise-grade solutions

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Challenges in today’s supply chain process

of the world’s corporate data currently resides in silos and prone to integrity decay2

80%

of companies report working with twice as many partners than they were 2 years ago (suppliers, logistics providers, other counterparties)3

30%

of companies do not use tech solutions to monitor their supply chain performance4

60%

of CEOs believe that gaining and maintaining trust is more difficult today than previously5

70%

of documents are processed manually6

90%

of disputes can be resolved automatically with the proper documentation verified beforehand7

80%

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Problem highlightsToday’s supply chain process is becoming increasingly complicated, as business interac-tions are becoming more complex while corporate data is siloed. Today, any enterprise from any sector is connected to a supply chain network (e.g., as a client, logistics provider or supplier). Why are supply chain issues so significant to businesses? Global companies face up to 90% of total expenditures that are directly related to their supply chain.8

Even if a company’s internal operations are running at near-optimal efficiency via existing IT solutions such as Enterprise Resource Plan-ning (ERP) tools, external interactions are most certainly not. Key supply chain challeng-es related to the issue of trust are described below:

70% supply chain visibility gap between initial suppliers and internal clients’ systems.9

The current supply chain process utilized by companies cannot provide complete visibility and transparency to trace goods from source to the end consumption, both from internal and external perspectives. This exposes counterparties to different costly risks such as late delivery, fraud, poor quality, failure to bear environmental and social responsibilities, and lost sales.

Poor traceability

90% of retailers inaccurately forecast demand.10

Lack of visibility in the delivery process, trust between counterparties, and semi-manual tools related to document exchange all lead to inefficient demand and inventory management, including running out of stock, failing to meet customer expectations, and selecting inefficient order and delivery channels with counterparties.

Poor automation

45% of supply chain executives say that they are experiencing increased pressure for regulatory compliance and internal compliance to contracts.12

Regulators are increasingly scrutinizing the compliance level of commercial enterprises in the supply chain, which can result in costly audits and fines. An illustrative case is “conflict mineral” traceability according to the Dodd-Frank act. According to the act, the “conflict minerals” disclosure addresses the link between armed groups in conflict zones and mineral resources, for which these groups loot, rape and kill civilians. The act requires companies to disclose their use of minerals, such as cobalt, and make their supply chains “conflict free.”13

Ineffective engagement with existing and potential partners by a single business may delay normal business operations for others within the same ecosystem. This can be caused by the costly and time-consuming practice of establishing goodwill between buyer and supplier via letters of credit, long and inaccurate qualification of new suppliers, failure to support product compliance with automated GDSN-activities, slow customs clearance and more.

Regulatory compliance burden

60% of companies regularly overpay their supply chain vendors.11

Providing effective data governance and enabling transparent communication, risk reduction and trust among complex multi-party supply chains is difficult to achieve. This leads to paying extra charges to vendors due to inaccurate and duplicated invoices, hiring a dedicated team for resolving numerous disputes with counterparties at different supply chain stages, and missing out on early-payment discounts.

Poor relations across multiple counterparties

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Why current technological solutions(ERPs, traditional databases, etc.)

are unsuitable for contemporary supply chain issues

overall supply chain technology market projected

to reach by 202114

$19 Billions

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Most companies worldwide run ERP and supply chain management software, with the overall supply chain technology market projected to reach $19 billion by 2021. However, despite the significant investments from enterprises in the IT sector thus far, there is still limited visibility and insight into where a company’s products are at any given moment. Can this be treated within a database? Several aspects of multi-party database management are considered below:

Inability to provide transparent data synchronization The database approach fails to provide an inherent share of data related to the supply chain, which is crucial for counterparties that do not trust each other to obtain information about a certain product, its price, delivery conditions, etc. The information is not always up to date from some parties, and some data may be hidden.

For instance, a counterparty may make changes to freight documentation regarding delivery dates, but the other party may fail to track such changes because of divergent data and poor, cumbersome and manual communication.

Unclear delegation of rights about changes in data raditional databases can be shared across the network, in which each participant trusts a central authority or database owner, which does not provide a single source of truth for the whole supply chain, as there is a risk that somebody could maliciously change the data to their own benefit.

Inefficient central data ownership Traditional databases fail to establish joint ownership. A central owner orchestrates the process, which poses a risk for other parties involved in the supply chain. The counterparties that own a database about their operations can limit access to crucial data, leading to opacity. Moreover, whether any data loss or other unintentional failures occur fully depends on the data management performance of the database owner.

In sum, current technological solutions are reliant on a traditional database approach that is unable to address actual business challenges related to transparent ownership, data management and having an auditable source of data which counterparties can trust

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In the transition to industry 4.0, industrial business can expect a 25% gross increase in ROCE by 2035.

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SolutionsHow emerging technologies (IoT, AI, robotics, blockchain) will change the supply chain

$310MILLIONSis the estimated global blockchain

supply chain market size

of supply chain leaders say digital transformation will fundamentally alter supply chain management.15 In the transition to industry 4.0, industrial business can expect a 25% gross increase in ROCE by 2035.

A potential $450 billion of capital employed and net profits will become available through its introduction in Western Europe alone.16

94%

$1.1BILLIONS

overall supply chain technology market projected to reach by 2021

$4.7BILLIONS

is the estimated global robotization supply chain market size

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BlockchainBlockchain (or distributed led-ger) technology concerns three technological innovations. The

of a shared, replicated and per-missioned ledger used for data storage. The second is the con-cept of smart contracts that can automate business processes using the data stored in the ledger. The third is asset tokeni-

are also migrated to blockchain and serve as fuel for “on-chain” business processes. These new

several ways:

• Data ownership inherentlyshared; no arbitrary dele-tion

• Single source of truth

• All changes are tracked andauditable

• Data is distributed across asecure network

RobotizationRobotic process automation (RPA) takes over high-volume

.snamuh morf sksat elbataeperIt frees up costs, speed up pro-cesses and links applications.

-tive in simple use cases, mainly where there is no automated data integration with a third party in the supply chain. Robot-ization of multi-party processes requires a trusted data integra-tion bus between parties.

$4.7+ billion is the estimated global robotization supply chain market size, and is projected to reach up to $19 billion by 2026.19

Internet of ThingsThe adoption of IoT is growing in select supply chain domains, but rarely as part of a complete end-to-end supply chain pro-cess. Logistics groups already use sensors to track assets or containers. Some manufactur-ers are assessing the business value of expanding beyond dig-itized devices. IoT could have a broad and profound impact on the supply chain in areas such as improved asset utilization and higher uptimes, better cus-tomer service, improved end-to-end supply chain performance and availability.

However, IoT systems often have closed or proprietary connec-tivity, creating interoperability challenges. Isolated IoT ecosys-tems need a trusted framework to communicate with each oth-er. IoT device security and au-thenticity are other major chal-lenges. Although IoT data can be a valuable asset, there is no well-established practice as to

$71 billion is the estimated amount spent on IoT for trans-portation in 2019, mainly on

management. The global IoT market is expected to reach $135 billion by 2025.18

-tion vision. Through self-learning and natural language processing, AI solutions can help automate various supply chain processes such as demand forecasting, production planning and predictive mainte-

in use as a proactive security feature. Along with automation comes augmented human decision-making, whereby the human is no longer involved in the decision-making process. Advanced analytics are in-creasingly being deployed in real time or near-real time in areas such as dynamic rates, supply assurance and dynamic replenishment. The availability of comprehensive validated supply chain data, such as Internet of Things (IoT) data, dynamic sales data and weather, GPS,

models and advanced analytics.

$1.1+ billion is the estimated size of the global AI supply chain and logistics market, and that number is expected to reach $10 billion by 2025.17

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-mational change is in the physical product supply chain. It can cre-ate end-to-end connectivity between supply chain participants, thus

stakeholder at every stage of the chain. Smart contracts can deliver fundamentally new ways of automation and bring visibility and control to each supply chain, which is simply not achievable in centralized

next. Immutability of the data stored in a blockchain allows instant

goods as well as verify and control the status throughout the trans-portation process by checking the data stored in the shared ledger. Moreover, the information about the product is transparent from its origins to end-customer.

$310+ million is the estimated global blockchain supply chain market size, and is projected to reach up to $10 billion by 2025.20

The technologies described above are potentially transformative on their own, but exponentially more powerful when combined. For ex-ample, AI provides process automation and advanced analytics, IoT and robotics enable new data streams, while blockchain plays the role of a trusted and immutable ledger to guarantee integrity and security of data management across the entire supply chain and related pro-cesses. Together, net cost savings from blockchain combined with IoT can be up to 0.8% of revenues.21

Blockchain technology in detail. Key attributes ofready-to-implement enterprise blockchainsWhile blockchain still has a path to travel before wider adoption, it is also important to recognize the way in which the technology has evolved over the last decade. This evolution can be split into four groups:

• Bitcoin and other cryptocurrencies

• Smart contracts

• Decentralized applications

• Enterprise blockchain solution

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Cryptocurrencies were the first application based on blockchain to attract broad attention. Second-generation blockchains came about with the application of smart contracts and enabled the implementation of public and permissioned models. The next step was connected with decentralized applications (DApps), which are based on decentralized infrastructure and whose code runs on a public peer-to-peer network. These DApps demonstrated better scalability and a higher capacity for transaction speed.

The evolution to enterprise blockchains is about usability in a real business environment, particularly in the case of digitized contexts. An enterprise environment includes IoT sensors, robotic automation, ERP, data management, and digitization of other business areas. Increasing task automation means an increasing need for safeguards — and this is where blockchain stands apart from other technologies.

It strengthens business integration and provides for shared environments for business processes: machine learning-based predictive maintenance, supply chain management, document flows and industrial IoT data collection are all examples of areas that can be empowered by enterprise blockchain.

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Introduction toInsolar Blockchain Platform

The Insolar Blockchain Platform is designed to enable the efficient formation, management and reconfiguration of business networks, providing a list of particular benefits for the clients:

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High scalability. Enterprise clients running multi-ple applications with data sources should be able to transact and record data to blockchain as needed. Insolar Blockchain Platform provides scalability to support any amount of supply chain participants and is capable of processing and recording vast quantities of transactions at once.

Proxy re-encryption. Businesses work with confidential, permissioned and public data simulta-neously, and confidential data needs to be securely protected from third-party access. Blockchain is a decentralized storage solution. With Insolar, data security is provided through proxy re-encryption technology, so that no participant can access confidential data of their network partners.

Low latency. Any business application that interacts with end-users or works with rapidly changing data sources needs to interact instantly with smart contracts. Insolar Blockchain Platform has low latency, which eliminates delays in interact-ing with the network.

No node required. Following implementation, business network onboarding and participation are simplified, as business network participants are not required to own or run their own nodes.

Custom contracts. Having custom contracts in common programming languages, Insolar simplifies client-side application development.

On-chain data storage. In order to have data integrity and trust, it is important to keep all data related to a certain cross-enterprise business process within a blockchain, without external data storages. Enterprise blockchain solutions allow companies to store all data, including large documents “on-chain.”

Predictable total cost of ownership. The Insolar Blockchain Platform also has a dynamic consensus that allows businesses to strike the right balance between transaction value and processing costs. The network consensus is adjustable to balance transaction value versus risk, thereby allowing enterprises to have a predictable total cost of ownership in place.

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Enterprise blockchain in action

Over-the-counter trading and settlement. How a leading mining company can boost

trade efficiency by 30%

ScenarioAn international mining company trades a rare commodity on a highly regulated, low-liquidity, over-the-counter market.

ProblemOver-the-counter (OTC) commodity trading is a siloed process. Each transaction is bespoke, as all interactions are conducted via telephone and/or email. There is no spot trading or exchange responsi-ble for defining market prices. Important data is fragmented and resides in unstructured docu-ments, leading to inefficiencies.

SolutionAn over-the-counter trading and settlement solution that creates a decentralized exchange for the OTC market for producers and buyers with trusted contract negotia-tion and execution functionality. It securely stores all conversations and documents while providing transparent and auditable market analytics.

Blockchain’s benefitsThe solution is >30% more efficient and offers trade finance savings. Parties rely on a secure negotiation environment with a single source of truth and automation of docu-ment exchange. Overall, these factors accelerate deal lifecycles by 100%. Moreover, dispute resolution times are eliminated completely or significantly shortened.

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Over-the-countercommodity

trading

Supplier Carrier Orign customs

Orign port Ocean/Aircarrier

Destination port

Inboundcustoms

Carrier Purchaser

Paperlesscustoms

clearance

Inboundsupply chainpredictability

SUPPLY CHAIN POWERED BY BLOCKCHAIN

Accountingproductivity

Provenancetracking

ProblemPaper-based customs clearance can cause delays up to 45 days23, leading to production plan failure. Despite the fact that the large compa-ny may have an established process with customs, more than 10 people are needed to manage the customs clearance processes manually. These processes, such as amending docu-mentation or tax management, are manual and paper-intensive.

SolutionA blockchain of data. The enterprise’s solution registers data, which is uploaded to the ledger manually or through gateways to customs software, the buyer’s enter-prise resource planning (ERP) and seller’s treasury management systems (TMS). The company has real-time visibility into the clearance status and automated docu-ment updates. In addition to storage are digital contracts to orchestrate the customs clearance process.

Blockchain’s benefitsThe company gets real-time visibility throughout the clearance process, as well as the ability to prevent delays and/or additional requests from customs through proactive checklists and data provided by multiple parties.

ScenarioA leading international manufacturer has its factories in Asia and imports materials from European OEMs.

Paperless customs clearance. How an international manufacturer can streamline customs clearance.

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ProblemScattered communications with freight carriers. Commu-nications with freight carriers are conducted via a multi-tude of channels such as emails, calls, excel spread-sheets, etc., and involves dozens of people from the company to stay up to date. Given the lack of real-time visibility into the location and expected time of arrival of the vessels, any disruption due to weather or other reasons puts the company’s inbound supply chain at risk. The company is interested in linking these vessel updates to the actual orders, with all information in one place. Ideally, this should happen in a touchless way.

SolutionThe blockchain of data registers messages from vessels and IoT sensors placed on the freight, as well as documents uploaded from ERP, TMS and electronic data interchange (EDI) systems. The company has real-time visibility into vessel status and is proactively informed about any freight delay.

Blockchain’s benefitsThis solution can reduce overhead costs to manage inbound logistics by >30%, improve max margin of error in predicting freight arrival by >50%, as well as reduce disruptions to opera-tions due to unexpected delays by up to 80%.

ScenarioA leading international manufacturer has its factories in Asia and imports materials from European OEMs.

Inbound supply chain predictability. How an international automotive company can improve inbound supply chain predictability.

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ProblemCurrent invoice management is plagued by manual three-way reconciliations — a pains-taking and resource-intensive process. Over, short & damaged (OS&D) deliveries have to be agreed upon between supplier and buyer, while supply agreement terms and conditions must be applied to validate the data on the invoice received. Reconciling business docu-ments typically starts from the moment the invoice is received. At that point in time, the data from different systems and parties has to be collated, compared, and necessary adjustments made.

It is a manual, expensive and error-prone process. Over $10024 is paid in extra reconcili-ation costs per invoice in labor and other overheads.

SolutionThe three-way reconciliation solution optimizes invoice processing through automation of the reconciliation process and provides visibility into the workflow along with powerful automation:

Order documents are matched to ensure their consistency

Automatic workflows representing business rules can be configured

Discounts available for early payment are monitored to optimize costs

Blockchain’s benefitsThis blockchain solution facilitate reconciliation by providing both the client and vendor with a single source of truth and the ability to efficiently interact. As a result, there is an increase in productivity of invoice manage-ment and up to a 100% elimination of all duplication and wrong payments, leading to more than $100 saved with each reconciliation.

ScenarioA large retail company has its fleet, which services its stores and distribution center. A distribution center stores goods from many small and medium-size suppliers. The suppliers have their own fleets that are responsible for transporting goods to the distribution center.

Accounting productivity. How a large retailer can save $100+ in each reconciliatio.

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ScenarioA car manufacturer uses a diverse portfolio of materials from different parts of the world. There is only partial visibility into the tier-1 supplier, independent of whether the supply chain includes an average of 10 stages.

Provenance tracking. How a leading automotive company tracks ethical and sustainable material- sourcing.

ProblemSustainability and ethical sourcing are critical to the public image of most brands and required from the market, as consumer expectations becoming more specific and complex. A recent study by Oracle in 2017 found that25:

However, current processes in the supply chain fail to provide manufacturers with essential information. Today, supply chain is managed in silos and processed via manual tools, leading to a 70% gap in visibility from initial suppliers to final assembly26:

41% want assurance the food they purchase has been responsibly sourced

35% would shop more with retailers they consider ethical

23% of shoppers have abandoned a purchase due to lack of information

50% of consumers are willing to pay up to 10% more for locally grown or produced foods, and nearly one in three are willing to pay 25% more

SolutionA provenance book is a blockchain-based database connected to all supply chain participants’ IT systems (ERP, TMS) with a gateway to a personal mobile application for car owners.

See a full list of interior car materials on a mobile applica-tion that is also available to clients

Get access to detailed information about the quality, origin, ethical sourcing and sustainability of each material

Receive up-to-date information in case of maintenance or replacements

Blockchain’s benefitsA transparent sourcing process of raw materials with new features for car owners and dealers. The provenance book allows supply chain participants to:

Poor information transparency results in a lack of awareness of the regulations, standards and proce-dures governing all stages of production in the value chain: from sourcing to the car’s assembly

Lack of identification and traceability of raw materi-als does not facilitate tracking throughout all stages

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Providers and solutions breakdownBlockchain vs. a non-blockchain-based solutionBlockchain technology has two unique differentiators compared to non-blockchain solutions.

First, distributed data storing provides trust in data due to its feature of immutability. It eliminates the need for historic data revali-dation, making data collection and usage more efficient. It expands visibility to external environments with the same level of trust.

The second feature is trust in operations, based on a single source of truth. With trusted data, any claim about a business process can be resolved in a fully-automated way. The process becomes fully automated, and, for example, a situation in which one party is able to shut down the system or disconnect another party by forcing data loss cannot happen. There should be a collective decision of all network participants.

Regulators can use the same single source of truth with other counterparties. Exchanges can be designed in a decentralized fashion. In cases where there are no exchanges, such as over-the-counter markets, a decentralized network can come to serve as an exchange.

Blockchain differentiators convert into solu-tions’ benefits. The solution provides a single source of truth that is used to store and pro-cess shared documentation, rather than manual document exchange in the case of cen-tralization. A blockchain-based solution has self-governance and is decentralized. Solution stores corporate data, making it always audit-ready for enterprises or regulatory authorities.

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Blockchain usage overview

About 20 various protocols are being used by a vast majority of blockchain providers. These protocols can be divided into four groups:

Below is a table comparing these four groups by key business requirements:

There are several key advantages of hybrid enterprise platforms based on business requirements. Network setup provides a low operating cost as well as a flexible transaction cost. Low latency allows instant interactions with external IT systems. They are easy to use and secure for enterprise due to support of widely used and any deployment scenario support including nodeless.

1.Decentralized applications running on public business-to-customer(B2C) networks

2.Decentralized applications on permissioned blockchain networks

3.Private enterprise platforms

4.Hybrid enterprise platforms

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Blockchain adoption challenges

30% of senior executives at large companies feel that regulatory issues are still one of the main barriers to wider blockchain adoption.27

Governmental and regulatory authorities fear loss of control due to direct B2B transactions. Some blockchain use cases are to be “approved” by regulatory authorities (e.g., digital supply chain contracts, compliance documents, asset tokenization, etc.). These factors reduce adoption speed and enterprise interest.

There is a strong argument that blockchains should be compliant with the existing regulatory environment, while regulators will analyze economic value and proceed with necessary amendments. However, some enterprise blockchain solutions can already be compliant with regulations such as the General Data Protection Regulation (GDPR), Electronic Health Record (EHR) standards, Health Insurance Portability and Accountability Act (HIPAA). Several neutral associations are developing standards for the blockchain space, such as Blockchain in Transport Alliance (BiTA)28 for transportation and Mobility Open Blockchain Initiative (MOBi)29 for mobility.

Regulation and governance

29% of senior executives at large companies feel that potential security threats issues is one of the main barriers to greater investment in blockchain.31

Corporations worry about losing control over their data systems, and this leads to enterprise leaders raising questions about the potential security and privacy of any data stored and accessible on a decentralized ledger. Companies are not willing to have any data leaving the border of their organisation. However, there are many cases in which a company needs to join a network with its competitors. Advanced data security technologies, such as proxy re-encryption can enable complete security.

Potential security threats

Due to the novelty of blockchain technology, there is a lack of standardization of approaches and tools, meaning it is difficult for enterprises to easily and efficiently implement blockchain initiatives and integrate them with existing IT solutions and legacy systems. Nevertheless, service and message-oriented design approach of blockchain solutions can enable complete interoperability with conventional systems and across enterprise blockchain solutions.

Costly implementation and no interoperability with existing IT systems30% of senior executives at large companies feel that practical implementation issues is one of the main barriers to greater investment in blockchain.30

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As noted in the previous point, corporations, more often than not, are against delegating any control to a decentralized network. Moreover, most corporate developers do not have blockchain-related development skills, which makes engineer-to-engineer interaction slow and cumbersome. Furthermore, corporate development team leaders often do not have a strong skill set or experience in blockchain system design. However, an environment that is easy to deploy and use can leverage existing IT personnel for blockchain solution designs and implementation.

Lack of in-house capabilities (skills and understanding)28% of senior executives at large companies feel that lack of in-house capabilities (skills and understanding) is one of the main barriers to greater investment in blockchain.32

Most blockchain providers do not have a predictable total cost of ownership for blockchain solutions. In public blockchain networks, there is a dependence on highly volatile transaction fees. For existing public blockchains, total running costs are estimated to be over $500 million a year and rising. In private or permissioned blockchain networks, there are high operational costs related to expensive system maintenance. A direct comparison between decentralized and centralized approaches shows >20% higher costs of blockchain in the most advanced installments. Nevertheless, a multi-step approach can show benefits early on, with limited investment and flexible deployment.

Return-on-Investment uncertainty28% of senior executives at large companies feel that uncertainty of return on investment (ROI) is one of the main barriers to greater investments in blockchain.33

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Roadmap to implementing blockchain solutions

Our work scope of cooperation with enterprises:

If you want to externalize innovative blockchain technologies in your business process, we have an offer for you. For enterprises we propose 2 options of consulting.

The power of today’s new digital capabilities is vast and growing. We are delighted to design and collaborate on innovations with clients who are interested in technology and its potential prospects.

We see a huge potential in using the Cointelegraph network for delivering blockchain innovations to an enterprise’s ecosystem. As for now, low embracement of blockchain technology is mostly caused by poor coverage of its advantages, lack of established interaction mechanisms and mistrust in the market. We believe that this inefficiency can be avoided through an unbiased and transparent network based on our experience.

Firms that want to seize the potential of blockchain need a companion with appropriate expertise in the blockchain space and industry integration. We want to implement progressive technologies by educating enterprises as well as assisting in the selection of provider and solutions deployment.

By connecting with solution providers, corporations will receive the ideal technologies for optimizing their business processes in a cost-effective manner, while providers will obtain superior opportunities to reach a global scale.

Approach of Cointelegraph consulting

Cointelegraph Approach

General consulting services

BASIC, BASED ON FIXED RATE: SPECIALIZED, BASED ON HOURLY PAYMENT RATE:

Custom market research and analytics

Technical assistance

Scouting projects for additional business directions

Advanced assistance in solution launch

Monitoring and inspection of the provide

Provide edifying materials and industry analytics

Pinpoint inefficiencies , develop technical optimization strategies

Scout providers to execute solutions for particular business units

Safe and transparent handling of the tender

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Insolar has developed a pragmatic approach to blockchain implementation via close collaboration with clients. It offers enterprises the opportunity to pilot a blockchain solution to evaluate ROI with minimal investment. This takes place without costly integrations or having to overhaul existing practices. The pragmatism is possible through Insolar’s capability to store documents on-chain without clogging up the distributed ledger while still keeping the data decentralized. This enables the practical implementation within the enterprise and shows the benefits at an earlier phase.

Within the supply chain, Insolar’s approach to blockchain implementation is staggered and takes place in the following steps:

Approach of Insolar

1. Use case discovery

Insolar starts with validation of the most promising areas within the client’s supply chain process to pick the potential use case. Insolar conducts a one-day workshop as well as several interviews with the client’s departments in order to form a comprehensive view of the client’s business processes. As a result, Insolar and the client formulate a joint vision on the why, the what and the how of the solution with quantifiable benefits, as well as taking into account key potential risks and establishing ways to mitigate them.

2. Pilot design and software development

When the joint vision is agreed upon, Insolar designs the supply chain solution architecture and roadmap for the first stage of blockchain implementation — the so-called “ledger of documents”. The solution records electronic copies of the physical or digital documents and, as such, captures each status change at each step of the supply chain. The ledger makes any docu-ment visible to all involved participants and notifies them about any change in the status of a particular order.

High end-to-end VISIBILITY

Low end-to-end VISIBILITY

Today:

Ledger of documents

Ledger of data

Low AUTOMATION

siloed

High AUTOMATION

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3. Pilot launch

When the software is developed for the scenario, Insolar and the client launch a practical testing of the solution’s technological performance, security and stability, in addition to preliminary validation of expected benefits in the real supply chain case.

4. Scaling and support

When the pilot results are validated, Insolar scales the solution to the final commercial product that has capabilities to cover more business scenarios, connect more different stakeholders to the system and be closely integrated with Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) and other existing IT systems for business process automation. Insolar also provides premium, instant support and maintenance services.

5. Moving forward to “ledger of data”

Only after the solution based on “ledger of docu-ments” has proven its worth as an effective tool to optimize operations and this has been expanded to scale, the next stage can begin. The “ledger of data” allows for automation of data transactions. Here, in addition to registering the electronic copies of physi-cal documents, structured data from sensors and other sources is captured. This enables digital (smart) contracts to act upon these data points (e.g., prices, delivery/payment dates, etc.), increasing the level of automation. Blockchain in effect becomes the “orchestrating layer” and keeps all record systems across all supply chain participants in constant sync. The end state is a highly visible and automated supply chain that only requires human intervention in excep-tional situations.

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Contacts

Peter FedchenkovFounder and Chief Revenue Officer

+1 646.991.6840

peter.fedchenkov@insolar.io

Consulting@cointelegraph.com

Dr. Lesley CzumaDirector of Sales Development and Media Relations

+1 646.583.2002

lesley.czuma@insolar.io

Wilfred RuijschEnterprise Project Director

+1 646.397.7913

wilfred.ruijsch@insolar.io

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http://image-src.bcg.com/Images/BCG-Pairing-Blockchain-with-IoT-to-Cut-Supply-Chain-Costs-Dec-2018_ tcm9-209846.pdf

https://hbr.org/2016/12/breaking-down-data-silos

http://go.impact.com/rs/280-XQP-994/images/PDFdownload-PC-AW-InvestinPartnerships.pdf

https://insider.zurich.co.uk/industry-spotlight/supply-chain-resilience-2018/

http://www.pharmatimes.com/web_exclusives/trust_in_the_supply_chain_1198084

https://www.billentis.com/einvoicing_ebilling_market_report_2017.pdf

Cyberlaw: Management and Entrepreneurship By Margo E. K. Reder, Jonathan J. Darrow, Sean P. Melvin, Kabrina K. Chang

https://www.logisticsbureau.com/7-reasons-why-the-supply-chain-matters-to-business-success/

Insolar research

https://curve.tech/inventory-demand-prediction-data/

The e-invoicing journey 2019-2025, Bruno Koch Billentis

“The Value of Strategic Supplier Data Management,” The Aberdeen Group Report

https://africasacountry.com/2018/09/cobalt-isnt-a-conflict-mineral

Gartner predictions for Supply Chain Management market

https://www.forbes.com/sites/louiscolumbus/2018/01/15/analyt-ics-will-revolutionize-supply-chains-in-2018/#688018656127

https://www.rolandberger.com/en/Publications/The-Industrie-4.0-transition-quantified.html

https://www.marketwatch.com/press-release/ai-in-sup-ply-chain-logistics-market-key-vendors-trends-analysis-segmentation-forecast-to-2017-2025-2019-10-03

https://www.ey.com/Publication/vwLUAssets/EY_-_Future_of_IoT/$FILE/EY-future-of-lot.pdf

https://www.globenewswire.com/news-re-lease/2019/07/29/1892951/0/en/Logistics-Robots-Market-To-Reach-USD-18-58-Billion-By-2026-Reports-And-Data.html

https://www.alliedmarketresearch.com/blockchain-supply-chain-market

https://www.bcg.com/en-ru/publications/2018/pairing-blockchain-with-iot-to-cut-supply-chain-costs.aspx

Insolar Technical paper

https://bizfluent.com/how-8761146-track-usps-parcel-customs.html

Insolar client interviews

Beyond Retail, Oracle, 2017

Insolar Research

https://www2.deloitte.com/content/dam/Deloitte/se/Documents/risk/DI_2019-global-blockchain-survey.pdf

https://www.bita.studio/

https://dlt.mobi/

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https://www2.deloitte.com/content/dam/Deloitte/se/Documents/risk/DI_2019-global-blockchain-survey.pdf

https://www2.deloitte.com/content/dam/Deloitte/se/Documents/risk/DI_2019-global-blockchain-survey.pdf

https://www2.deloitte.com/content/dam/Deloitte/se/Documents/risk/DI_2019-global-blockchain-survey.pdf

https://www2.deloitte.com/content/dam/Deloitte/se/Documents/risk/DI_2019-global-blockchain-survey.pdf

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Date: November 12, 2019 Version: 1.0 Status: Approved for Private Dissemination Copyrights: Cointelegraph, Inc @ 2019