This is the year Blockchain gets real. After an intense period of development and disruption, Distributed Ledger Technology (DLT) solutions will start to roll out at scale in 2018, bringing cost-efficiency and risk-reduction to well-positioned enterprises. Schneider Electric and Capgemini have already partnered on proof of concept DLT projects, now is the time to start reaping the rewards. Read the article for insights into riding the third wave of Blockchain and see how far it can take you.
From disruptor to business foundation
Blockchain, or rather the broader category of Distributed Ledger Technology (DLT), is transitioning from a disruptor to a business foundation. We are still a few years away from seeing its full potential, but DLT offers new cost-efficiency and risk-reduction approaches right now, and Capgemini is already working with partners like Schneider Electric to realize these benefits in a wide range of service areas.
The three waves of Blockchain
We expect 2018 to be the year Blockchain solutions start to be deployed at scale. So far, we have seen two waves of DLT disruption, and we foresee the third making an impact this year and growing in strength over the next four-to-five years.
Wave one encompassed efforts to understand the technology and its implications. This wave has clearly been felt for some time, but we expect it to achieve maturity this year, especially for enterprises. Full-stack Blockchain as a Service (BaaS) cloud offerings are now available from IBM. Microsoft, and others, and Hyper Ledger and Fabric 1.0 show that many issues around performance, security, and network reliability have been resolved.
Wave two covers the thinking through of business scenarios and use cases. The past two years have brought a growing realization that DLT should not be approached simply as a solution looking for a problem—effective use cases need to be thought out carefully and with a sophisticated appreciation of context. Wave two will include evolution from single use cases, such as payments, to intra- and inter-company scenarios such as trade finance, farm-to-fork, and others. We are also likely to see these ideas spreading beyond financial services to a much wider range of industries. More consortia, like R3 in banking and B3i in insurance, are probable.
Wave three, which we expect to be the big Blockchain story of 2018, is enterprise transformation—the arrival of real-world business impact at scale. As this wave builds, we will see DLT deployment, post-deployment, operations, and maintenance. DLT front ends will be developed and business processes and rules will be redefined. On the back end, APIs and integration with SAP, Oracle, etc. will proliferate. Along with these advances will come an entirely new approach to data and transaction management, user authentication, and authorization areas.
Defining the challenges
With this outline of the near future in mind, Capgemini has invested considerable effort in defining the challenges that our partners wishing to take advantage of DLT will face, and how we can help answer them. Broadly speaking, these come under five categories:
- Business process redesign and how to track and measure DLT adoption
- Establishing a supportive DTL business and technology ecosystem
- Overcoming deployment barriers in regulation, compliance, security, and talent
- Integrating DLT with other digital disruptors such as AI and IoT
- Tracking business cases and ROI for DLT investment.
A strong Blockchain history
Capgemini has been heavily involved in wave one and two projects with multiple partners, including Schneider Electric, so we are in an excellent position to implement enterprise transformation. For example, in 2017 we participated in a successful proof of concept for the use of DLT in supply chain at the Schneider Electric Center for Digital Innovation (CODI), along with IBM. In 2018 the plan is to take this a step further with proof of value projects for DTL in tracking and tracing and product genealogy.
With other partners Capgemini has participated in wave one and two projects across multiple industries:
- Financial Services: Know Your Customer (KYC) and Know Your Building (KYB) projects, plus trade finance, cross-border payments, and securities projects.
- Pharma: Efficacy-based payments using Ethereum. Bringing patients, doctors, pharma enterprises, and insurance enterprises together with smart contracts.
- Telecoms: Replacing SIM cards with smart contracts that enable plan switching to suit geographies in real time. Transparency and user experience drivers. Ethereum on Azure.
- Manufacturing: Recall process operational efficiencies derived from enhanced visibility into product batch origins.
- Oil and Gas: Smart retail distribution and Quality of Service (QoS.)
- Logistics: Airlines and shipping company tracking developed in Hyper Ledger Fabric.
- Automotive: Vehicle ownership and transfer tracking through manufacturers, dealers, and customers. Parts tracking for authenticity and in conjunction with vehicle ownership.
- Retail (luxury): Authenticity certifications, warranties, etc. through Everledger.
Capgemini is not only ready to bring the benefits of Blockchain to Schneider Electric, we have already started to do so by partnering with you in very promising wave one and two projects. Our wide experience in projects of this kind across multiple verticals with multiple industry and technology partners means we have a lot more value to offer Schneider Electric in this exciting area.