Years after the first pilot projects for enterprise blockchain, it’s difficult to get a clear sense of their success
I’m trying to solve a business mystery: are private blockchains effective in addressing enterprise use cases?
This sounds like it should be easy enough to figure out.
Believe me, that’s what I thought.
But the more you look, the more confusing it gets.
Let’s start with the reasoning that would suggest the answer is “yes”:
- Walmart Canada touts a success story in leveraging a private blockchain to reduce the rate at which supplier invoices require manual reconciliation from 70% to 1%
- In 2018 BMW kicked off a pilot to leverage blockchain in managing cobalt in its supply chain; at the end of last year it announced a new blockchain project to better manage financial operations and (eventually) bolster its customer loyalty program
- Another success story comes from a blockchain implementation to better manage Microsoft Xbox’s royalty payments by cutting payment times from 45 days to 4 minutes
There are many more stories like this, but let’s look closer at these examples.
The technical lead for the Walmart Canada example now holds a C-suite position. That suggests some level of project success.
BMW is going back to the blockchain well several years after an initial pilot. Surely that wouldn’t be happening if the 2018 pilot didn’t at least show considerable promise?
And look at those numbers again:
70% error rate to 1% error rate.
45 days to 4 minutes.
That’s not just good. That’s PHENOMENAL.
Yet many blockchain enthusiasts balk hard at the suggestion that private blockchains solve real-world problems. The mere mention of the word “private” or “permissioned” can spark an impromptu struggle session aimed at cleansing impure thoughts.
If private blockchain solutions were largely successful — wouldn’t there be more alignment around them by now? Many pilots like the BMW/Cobalt example launched in 2017–2018. If such experiments tended to pay off, shouldn’t…