IBM: five principles to build trust and value in blockchain
In the May edition of Supply Chain Digital, we examined blockchain’s influence on the supply chain and the opportunities that have come to the fore.
In this article, we examine IBM’s report ‘Blockchain as a force for good: Five principles to build trust and value’, and take a closer look at their blockchain principles that work.
1. Open is better - blockchain networks should harvest diverse communities of open source contributors and organisations. This will allow for open innovation as well as strengthen the overall quality of code. Wherever possible, developers should avoid proprietary technologies in favour of open source frameworks with defined approaches for sharing contributions. If done correctly, this can accelerate innovation, decrease time to maturity and reduce cost.
2. Permissioned doesn’t mean private - blockchains should be designed around the principle of permissioned and trusted access. Permissioned blockchains have an access control layer to allow certain actions to be performed only by certain identifiable participants. Most organisations require the necessity to know exactly what business they’re conducting business with as well as ensuring no illegal activity is being transacted over the network.
In blockchain we trust: knowing the source of our daily bread
3. Governance is a team sport - enterprise blockchains should embrace distributed and transparent governance to enable networks to serve the requirements of participants and prevent undue concentrations of influence. Enterprises should decide on a platform that automatically provides a democratic structure hardwired into the network, with built-in privacy and ‘permissioning’ features. Rules governing who can join the blockchain network and how should be clearly described, in addition to guidelines on how participants can play key roles.
4. Common standards are common sense - enterprise blockchains should be centred around common standards with interoperability in mind. This will enable “future-proof” networks, prevent vendor lock-in and encourage a robust ecosystem of innovators. It is important that interoperability includes cloud platforms: vendors should meet participants where their data already is. With most blockchain networks currently sitting in silos, it is deemed acceptable that the technology is evolving to support a network of networks.
5. Privacy is paramount - participants on an enterprise blockchain must be able to control who can access data and under what circumstances. This is vital on a platform that distributes data widely across multiple nodes. Despite no single participant owning a blockchain network, the rights to the data that resides on it should always belong to the creator. Any APIs should extend the same permissioned access programmatically. Blockchain platforms should also abide by privacy regulations, such as General Data Protection Regulation (GDPR). This means that in most cases, personal data should be kept off-chain.
For more information on procurement, supply chain and logistics topics - please take a look at the latest edition of Supply Chain Digital magazine.