What exactly is 'blockchain' technology? And how could it have a positive impact for your business?
Blockchain, or ‘distributed ledger technology’, works by splitting up information into discrete blocks or ledgers, and saves these blocks across multiple servers. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data, creating a chain of data that can only be accessed by those with the correct authority.
So, how could this innovation help your small business?
A secure, digital way to manage transactions
Blockchain is still an emerging technology, but there are already real-world examples of blockchain in action – for example, Bitcoin and cryptocurrencies are one key area that’s already driven by the principles of distributed ledger technology.
The banking and financial services sectors are starting to explore blockchain functionality and the practical use of the technology has the potential to revolutionise the way you run your finances, operations, and data systems as a small business.
The inherently secure nature of blockchain lends itself to many areas of your business:
- Making and receiving payments – By 2018, exploration of blockchain technology had been started by about 90 percent of USA and European banks and financial institutions. And once these payment gateways are fully available it will greatly increase the efficiency, transparency, and security of your accounts payable and receivable functions, moving away from traditional financial data storage to a blockchain model.
- Managing your supply chain – staying in control of each element of a complex supply chain, and the paperwork that drives this, is a challenge for any company. Distributed ledger technology allows you to create a seamless chain of digital transactions, with a completely transparent audit trail of the entire process. This has the potential to reduce the complexity of supply chain management and the productivity of your business.
- Storing sensitive data and customer information – storing documents, customer data and sensitive business-critical information via a distributed ledger model greatly adds to the safety and security of this information. Only those individuals with the correct authority and rights can access the data that’s locked up in the chain, making it a far more secure storage medium than traditional drives or online cloud storage.
83 percent of executive teams believe there's a compelling business case for blockchain, according to recent research by Deloitte. Blockchain may still be in its infancy as a business technology, but the potential applications are growing year on year – and it’s the early adopters that are most likely to feel the benefit of blockchain’s competitive advantage.
Distributed ledger technology can add value for your company
If you’re interested in exploring the business benefits of new technologies in your company, come and talk to us. Whether it's blockchain or other technology developments, there are a number of tools that can help you run a more efficient and profitable business.