Is Your Supply Chain Ready for Blockchain?

By: Olivia Montgomery, PMP on May 24, 2019

Blockchain is no longer an abstract business buzzword—accounting and supply chains are adopting the technology now. And even if these are the only major industries pushing the adoption, it has a major trickle down effect.

Case in point is Walmart’s mandate for all suppliers of leafy greens to upload their data to IBM’s FoodTrust, a key component of their blockchain network. Click here to read exactly how Walmart is blockchaining your lettuce.


A worker harvesting lettuce (Source)

Gartner predicts that supply chain blockchain will be a global movement with $2 trillion of goods and services processed annually by 2023. (Full reports available to Gartner clients only.)

Defining blockchain network technology for supply chain

OK, so what is supply chain blockchain? At a basic level, the step-by-step process across a supply chain is tracked on a ledger maintained on a blockchain software system, such as IBM’s FoodTrust.

Then, each user responsible for a step in the process can create a “block” or a “node” in the network that represents that their step has been completed. That user has been authenticated by other users in the system and therefore is considered a trusted source, adding accurate blocks.

The block created by the user is then distributed across multiple copies of the ledger, providing transparency across the process. Each block added is linked to its former and its predecessor, making the chain.

Here’s a simplified example using a coffee supply chain to demonstrate how each party’s step is added to the blockchain.

example-of-how-blockchain-works-in-a-coffee-supply-chain also has an excellent graphic with technical details represented here.

What’s driving the adoption? Consumers are the main driver, demanding transparency into the source of the products they are purchasing. Bernard Marr, industry expert, states “ultimately, blockchain can increase the efficiency and transparency of supply chains and positively impact everything from warehousing to delivery to payment.”

FutureProofing recommendations for supply chain blockchain

Gartner sees blockchain significantly disrupting current supply chain technology and advises businesses to prepare now “even if you don’t aggressively adopt the technologies in the next few years.” (Full reports available to Gartner clients only.)

Here’s our recommended practical approach to prepare your business for the disruption:

Evaluate your current traceability abilities

At the core of the consumer demand for transparency is the desire to know where products came from. This is just lot traceability—and thankfully it’s something you can work to implement or improve now.

Many supply chain management, inventory management, and warehouse management software systems can provide the lot traceability needed to satisfy present consumer demand. Blockchain networks will greatly improve transparency, but don’t wait for it to solve the problem when you can make strides in traceability now.

Talk with your partners about their plans for adoption

The timing of disruptions will be driven by when your upstream and downstream supply partners adopt blockchain technologies. With major retailers like Walmart, Sam’s Club, and Starbucks charging ahead with blockchain efforts, the pressure will most likely continue to come from large enterprises.

So whether you produce or ship for these retailers your business, you—along with your partners and collaborators—will likely start to feel the pressure to adopt or else lose the business. Stay on top of the messages being sent to your supply chain partners and start an open dialogue and continue to check in to avoid surprises.

Prepare for changes throughout your business through training and education

Not only will your operations team need to understand how to upload data and view recorded events on the blockchain network. But every aspect of your business will be impacted by the operational and software changes required, including accounting.

For example, the International Organization for Standardization (ISO) currently has 12 blockchain and distributed ledger standards under development on their site (ISO/TC 3017). Your entire team will need to stay up on the changes in order for you to stay compliant if you adhere to these. It’s safe to assume that more will be coming as adoption grows so it’s a good idea to keep this on your radar.

Also, we recommend keeping these changes in technology in mind when hiring new talent.


We’ve covered the importance of leveraging blockchain in your supply chain and how to prepare for these changes in the industry. A step you can take today is to evaluate your current software.

Getting that foundational software in place now will make it easier to scale new technology down the road.

Give our software advisors a call at (855) 998-8505 for a free consultation of supply chain management software options that will best suit your business needs.

About Walmart’s mandate for farmers to use blockchain

Given that Walmart also recently announced it will start its own beef supply company, they’re sending a clear message to either get on board or get replaced.

Click here to jump to my breakdown of exactly how businesses are adopting IBM’s FoodTrust blockchain network in order to be compliant. An adoption expert also weighs in with his top tips!