Mere mention of the term ‘ BlockChain ’ is enough to trigger off chatter and speculation – fueled by its rather simplistic association with cryptocurrency. With large investments in a business that’s still volatile with no real framework of governance, it’s easy to assume BitCoin to be synonymous with BlockChain.

While BlockChain is the technology that drives BitCoin – that’s nowhere close to what it is and what it promises to do. BlockChain as a concept can be simple yet incredibly complex. More and more business leaders are realising that BlockChain and its technology will impact each and every area of business – be it accounting and finance, distribution, operations and more. Twenty years ago – the Internet revolutionised the way we did business – by enabling exchange of information in a swift, efficient and transparent fashion. BlockChain promises to be as disruptive – by enabling transactions in a secure, transparent, immutable and auditable way.

Understanding BlockChain

In their piece that deconstructs what BlockChain is all about – Marco Iansiti and Karim Lakhani set a context for BlockChain and the reason for its existence and the problem that it solves. They talk about how transactions of all kinds and their records are the foundation of our economic, legal and political systems. The tools created to manage these interactions have not kept pace with the speed and quality of our digital transformation. And this is where BlockChain comes into the picture and promises to solve the problem.

So what IS BlockChain really all about ? In very simple terms – BlockChain can be described as a Ledger hosted on the Cloud. BlockChain is an open, distributed ledger that can record transactions between two parties efficiently, in real time and in a verifiable and permanent way. In this open ledger, users can add updates and reconcile accounts. Past transactions can be seen and updated – but not changed.

BlockChain Features

Broadly there are three levels of BlockChain utilisation:

Digital Records Storage : Secure storage of virtually any digital information or records that cannot be changed – ensuring authenticity

Digital Assets Exchange : Peer to peer transaction without any trusted intermediaries –ensuring transparency while reducing time and costs.

Smart Contracts Creation : Automated execution of actions based on conditions specified in the said contracts – validated by all parties – enabling auto execution and minimization of errors.

BlockChain transactions are hosted by millions of computers at once, creating a secure and decentralised system. And it is beginning to disrupt the way we live and work. According to an IBM survey, “91 percent of banks are investing in BlockChain solutions for deposit-taking by 2018 to protect against start-up non-banks.”  Harvard professors Iansiti & Lakhani visualise a BlockChain ruled world where “ … contracts are embedded in digital code and stored in transparent, shared databases, where they are protected from deletion, tampering, and revision. In this world every agreement, every process, every task, and every payment would have a digital record and signature that could be identified, validated, stored, and shared….individuals, organizations, machines, and algorithms would freely transact and interact with one another with little friction.”

The logical conclusion then – is to see the use of BlockChain technology in the financial services sector – but there are other possible applications in different sectors which are mentioned below:

Accounting & Finance Operations that are Accurate & Verified

BlockChain technology can easily manage complex rules and codes, across remote locations processing large volumes of transactions with precision and accuracy. Its permanent record of transactions enables easy and accurate audits while pulling in records from different sources.

Eliminating Fraud in Marketing & Advertising Performance

Juniper Research predicts ad fraud to reach $44 billion by 2022 across web and mobile. BlockChain technology can dramatically reduce “click fraud.” The system will enable advertisers to govern, monitor and optimise spends basis creative and publisher performance pertaining to programmatic media buying – negating the possibility of underperformance and overcharging for campaigns.

Human Resource Management Automation

BlockChain is all set to revolutionise Hiring – as technology that will enable quick screening and verification of prospects – with significantly reduced chances of fraud and misrepresentation. BlockChain is also beginning to automate standard HR functions such as Payroll, Leave Management, Performance Appraisals and more.

Highest Level & Most Effective Cyber-Security

Given that data is the new oil – and its accumulation, validation and protection is paramount for enterprises – there is increasing emphasis on protecting networks, hardware, software and data itself from attack and unauthorised access. Since BlockChain technology provides a way of recording and tracking digital transactions in a manner that is secure, transparent, outage resistant, auditable, and efficient – it can form the basis of a highly effective cyber security system,

 Quality Assurance for Production Management & Efficiency

An organisation can link every part of its manufacturing process to its supply chain, quality and performance parameters. In order to monitor production or in case there is the need for a product recall or investigation. BlockChain can immediately identify a manufacturing problem via its definitive, contiguous ledger.

 Streamlined Securities Trading Processes

BlockChain can enable quicker trading on stock exchanges – as the distributed nature of technology ensures that a process undertaken over several days, is finalised and automatically completed in minutes, thus greatly streamlining the entire experience.

Creating Smart Contracts with Efficient Data Processing 

Creating Smart Contracts using BlockChain can enable an organisation to securely handle large transaction volumes of confidential data, including those that run across supply chains, automatically.

.Enabling Transparency in Voting 

Votes can be moved along a BlockChain in an accurate and secure fashion – in order to support a transparent democracy and ensure validation of election results. In Japan – the system verifies voters’ credentials before securing the vote from being falsified or accessed through decentralised blockchain technology, while citizens vote for social development programmes.

Safeguarding Intellectual Property Rights

BlockChain can eliminate intellectual property theft and piracy in the business of original content. For example – storing cryptographic hash of original music, linking it to digital identities of its users and ensuring compensation for its use by consumers – with use of smart contracts.

Authenticating Land Ownership

State Governments in India are building a land registry using BlockChain to validate ownership of a piece of land by creating an immutable history of past transactions, that are authentic and always available.

Looking Ahead with BlockChain

To conclude – the BlockChain market is expected to touch US$ 16.3 billion by 2025 . In terms of business impact -Gartner has predicted that distributed ledger technology’s business value-add will grow to $176 billion by 2025 , while expressing confidence that it is on the way to broad adoption, with use cases of increasing scope, scale and complexity.

Secure, authentic, operational efficiencies are being created with its use in both developed and developing markets. Domain experts advise caution with regard to adopting BlockChain – on account of the time taken to implement, barriers to adoption and the complexity – especially when it comes to being a pioneer in one’s area of business.  They recommend starting small in order to develop the know-how and experience to think bigger.

In the long run – we know that BlockChain will affect and change businesses. It’s just that we are still not sure when.