7 Ways Blockchain Enables Business Transformation

Can you imagine an industry untouched by technology? No right? Businesses would struggle to survive without new technology and innovations in the fast-paced and highly competitive landscape. As competition grows globally, businesses must be more vigilant than ever to stay relevant and cut through the competition.

Historically, companies that embrace innovation and technological advancement have zoomed past their competitors and risen above the rest. Therefore, companies should be on the lookout for game-changing and disruptive technologies that help them gain a competitive edge. For these reasons, many businesses have prioritized digital transformation, which involves the streamlined adoption of new technologies to improve performance, internal processes and more.

Artificial intelligence (AI), machine learning, augmented reality (AR), virtual reality (VR), industrial automation and blockchain are some of the latest cutting-edge technologies paving the way for through-and-through digital transformation in many businesses.

The hype around blockchain is only growing. A large number of companies have stated that they are “actively involved” with blockchain technology. A PwC report states that around 84% of companies intend to use or are already using blockchain [1].

In this article, we will examine the role of blockchain in business and how this innovative technology facilitates business transformation. The technology that has been the driving force behind cryptocurrencies has spread its wings across other walks of life.

Let’s start by understanding what blockchain is. We will then move on to understand the use of blockchain in business and what lies ahead on this path in the future.

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Understand blockchain technology and the hype surrounding it

Often used interchangeably with Bitcoin, blockchain is the technology behind cryptocurrencies. While the adoption of blockchain technology saw a steady increase as cryptocurrencies became increasingly popular, businesses are aligning and gradually discovering the benefits.

So, what exactly is a blockchain and how can blockchain help businesses?

Let’s find out.

Blockchain is a decentralized, irreversible database that makes it easier to track assets and record transactions in a corporate network. An asset can be physical (such as a home, car, money or land) or intangible (intellectual property, patents, copyrights, branding). Practically everything of value can be recorded and traded on a blockchain network, reducing risk and increasing efficiency for all parties.

Many industrialists and business owners believe blockchain is one of the key technologies that will accelerate business transformation in the future. Although blockchain gained remarkable momentum during the rise of crypto, today blockchain in business is gaining popularity due to a myriad of reasons.

It is important to understand that blockchain for business applications is largely built on a distributed ledger that is shared between trusted partners. The technology’s peer-to-peer topology plays a crucial role in driving data resilience, transparency and security while minimizing the costs associated with running a business.

Businesses that want to advance to the next level must first take advantage of the benefits of blockchain with a clear mindset. The companies now have the responsibility to find out how blockchain can help with business transformation.

Use of blockchain in business

Now that we have a good understanding of blockchain technology, let’s look at how blockchain can help businesses flourish. Blockchain has all the ingredients to overcome all the barriers facing businesses today. Thus, it is only a matter of time before blockchain will gain mainstream acceptance by businesses from around the world.

Here are a few areas within a business where blockchain can work its magic and turn things around.

1. Blockchain for business will introduce smart contracts

While discussing blockchain for business transformation, it is impossible not to mention smart contracts. Arguably, the concept of smart contracts is one of the most notable blockchain applications that will aid in business transformation.

But what do we mean by smart contracts?

As the name suggests, smart contracts are digital contracts where the terms and conditions of all parties are written in code. All codes are secured on a decentralized blockchain system, which ensures optimal security. In other words, the code is tamper-proof.

Thus, when the agreed conditions are fulfilled by both parties, the corresponding conditions are executed. If either party defaults on the contract, the agreement is canceled immediately. Therefore, the introduction of smart contracts enables firms to take legal action without the help of a regulatory lawyer, a government representative or other intermediaries who charge a fee to resolve disputes.

2. Blockchain for business will streamline digital payments

We are excited about this one. The marriage of blockchain and digital payments was on the cards for a while now. Now it has become a reality. Digital payments made on the decentralized blockchain networks will be one of the key opportunities for business transformation in the future. How?

The entry of blockchain into the digital payment area will bring about some exciting changes. One, the need for third parties will disappear. Second, businesses don’t need to handle various documents, including invoices, bills and more. Lastly, blockchain has streamlined cash flow across multiple businesses so far, and going by current trends, that won’t change anytime soon.

3. Blockchain will strengthen security

Introducing robust security measures into the environment is another important application of blockchain in business.

The technology’s decentralization and transparency capabilities incentivize network customers to store and verify some or all of the data stored on the network. The main difference between conventional and blockchain databases is their decentralization. The blockchain network’s increased complexity and security measures reduce the likelihood of cyber attacks.

The functionality for users to preserve and retain their identity, as well as understand how they can access and use their information for any reason, is made possible by the use of blockchain in the digital identity business.

4. Blockchain will make financial management more efficient

Companies are currently spending a lot of money on upgrading existing infrastructure. Therefore, more and more businesses are leaning towards finding cost-effective solutions that reduce these expenses, towards lowering expenses and existing processes because of this. With blockchain entering the fray, companies can save a lot of capital that they usually pay to third-party vendors.

Since blockchain technology excludes a hereditary centralized person involved, you do not pay the provider fees associated with the respective blockchain development company. When authenticating a transaction, there is significantly less need for interaction, which frees up time for other tasks. This is how blockchain technology can help businesses march towards better, financial and organized financial management.

5. Blockchain to improve supply chain management

Here’s how blockchain can help businesses facilitate agile supply chain management. The technology makes it possible for small and medium-sized businesses to track their goods/services in all phases of the process, from production to delivery to the customer. With this transparency and immutability, companies can deal with counterfeiting, track delays in product delivery and be confident that security is not compromised at any stage.

6. Build a dream team with blockchain

Who would have thought that blockchain would play a role in how companies recruit employees? Yes, you read that right. Blockchain technology is playing an important role in transforming how companies build a workforce. This is how.

We have all heard about how a few unethical people change a few important details to create fake yet professional looking documents. From creating fake university certificates to waving fake experience letters, recruitment teams have to deal with all kinds of petty and serious crimes. Blockchain puts an end to this and that is precisely why it will play an important role in improving the overall hiring process along with the credibility of the resources on board.

This helps companies reduce the overall time needed to hire candidates and review paperwork. As a result, companies are working tirelessly to tie up with reputable blockchain development firms and work on blockchain applications that will help their hiring process.

7. Can blockchain improve customer engagement?

Blockchain technology also helps businesses find new ways to engage with a larger customer base.

The combination of blockchain technology and customer engagement opens up more opportunities and benefits. We can achieve this by choosing the best Blockchain-as-a-Service company. This involves empowering users to manage their personal information, introducing transparency into business models, encouraging fast transactions and helping business owners and marketers recognize and nurture a loyal following.

Go blockchain or go home – blockchain is staring at a bright future

As seen in this article, blockchain has all the features to facilitate fast, secure and reliable business transformation. We expect companies that want to jump to the next level to stay abreast of the latest developments in blockchain and the blockchain ecosystem. As global spending on blockchain solutions continues to rise, now is a good time to incorporate this innovative technology into core business processes.

Businesses need to get in touch with trusted blockchain development companies if they are wondering where to start their business transformation journey.

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Feature image source: Image by Davidstankiewicz used under the Attribution-Share Alike 4.0 International license

Image 1 Source: rawpixel.com

Image 2 Source: Photo by Norbert Kundrak on Unsplash

Sources:

[1] Rooney. K (2018) “84% of Companies Are Using Blockchain, New Survey Says” CNBC [online] Access [December 2022]