21 Jan 2020

How Disruptive will Blockchain be for Project Management?

Guest writer, Steve Wilson, Blockchain
How Disruptive will Blockchain be for Project Management?


Blockchain has been around for some time. It has made in-roads into select financial services and supply chains among other areas. Conventional functions like government are now sitting up and looking at Blockchain with greater interest.  Let’s peek at what Blockchain means in the project management space.


THE STARTING POINT

The earliest and still most prominent use of blockchain was for creating electronic cash. Blockchain originally worked as a public ledger for Bitcoin (a simple electronic cash system). It was highly distributed, available and mostly free. Transactions were visible forever, linked and cryptographically sealed, with crowd-sourced overseeing of all spends. Gradually blockchain technology evolved to handle more complex financial services and other use cases. Today blockchain is starting to simplify administration, speed up transactions and make select financial networks more resilient to outages and fraud.
 

EVOLUTION

Blockchain currently exists in multiple forms. The most prominent classification is Public versus Private.
Public – This is the original version of blockchain that is a decentralised peer to peer network, open and accessible to all. It is the form in which Bitcoin and Ethereum deploy blockchain technology.
Private – This is a permissioned system that places restrictions on who participates in the network and in which transactions. They tend to be run as managed services and can offer a range of secondary services such as confidentiality. Examples include R3 Corda, Hyperledger Fabric, Sovrin, Hedera Hashgraph, and Quorum.
 

SITUATIONS WHERE BLOCKCHAIN DOES NOT WORK

While Blockchain is becoming impactful in several industries, there are situations where it’s best to avoid it:

  1. The primary goal of public blockchains is not to promote efficiency but to crowd-source oversight of a ledger, in order to remove centralised administration
  2. These are not databases but a way to establish very particular data properties. The blockchain is more of a write-once read-many transaction log than a database
  3. Since Blockchain is an immutable public ledger it doesn’t usually work well for private enterprises. 


BLOCKCHAIN IN PROJECTS

Here’s a list of areas where blockchain could be used for projects
 
Supply chain: Pharmaceutical and medical device industries are exploring supply chain applications of blockchain. Using private blockchains organisations can share and coordinate facts and figures about components, test results and distribution history reliably.
 
Shipping manifests: Blockchain records all shipping manifests and incorporates real time updates made by various parties involved. This way blockchain can synchronise multiple versions of a shipping manifest thereby bringing down costs and expediting dispute resolution.
 
Asset management: There are cases where public blockchain has been used for recording physical assets like for land titles and luxury goods. Each item is represented symbolically or ‘tokenised’ in ledger entries with external third parties vouching for them. There aren’t many benefits of using public blockchain for asset management over a standard database.
 
E-voting: Blockchain’s extreme tamper resistance and auditability can benefit e-voting in theory. Voting however involves strict registration processes to ensure that each voter has a single vote. This kind of central management doesn’t sit well with blockchain’s decentralised approach.
 
Back-office processes: Stock exchanges and big trading banks are experimenting with blockchain for back-office tasks where there are disparate financial institutions collaborating with fewer intermediaries and oversight processes.
 

THINGS TO KEEP IN MIND WHILE TAKING UP PROJECTS WITH BLOCKCHAIN

 While blockchain has helped resolving certain issues for different industries, it doesn’t work for all problems. It’s important to evaluate each project and correctly assess the potential of blockchain. For starters, blockchain can’t do much in an environment that mandates central administration. There also isn’t a lot in terms of use case studies and industry best practices for blockchain since its adoption has been slow.
 

IN A NUTSHELL…

  • Be selective with blockchain implementation. Blockchain works well in situations that involve shared data across organisational boundaries.
  • Let deep-pocketed cloud and managed service providers do the heavy lifting of blockchaindevelopment
  • Experiment with small trials (and be prepared to fail)
  • Focus on your business, not on blockchains.
 
 


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WRITTEN BY STEVE WILSON

Steve Wilson is an independent researcher and adviser in data protection. He specialises in blockchain technology applications, advising clients and developers around the world. Lockstep.com.au