Blockchain based traceability system increases efficientcy and reduces manual labour for all companies in the manufacturing or food manufacturing supply chain network.
The problem with implementing traceability, especially for the small manufacturing and food companies, is the amount of time and paperwork it requires. And even if the company puts it's best effort into the traceability program, it is impossible to trace the final product back to its origin through the multiple supply chain partners and their internal isolated traceability systems.
Combination of mobile and blockchain technologies solves this problem. Mobile data collection allows companies to easily collect data and track products on the shop floor in real time. Blockchain technology allow all supply chain partners to record and review traceability information in one system. Traceability information for each component, product batch and assembly is added by the respective companies as product progresses through the supply chain, and the entire supply chain network has an immediate access to this information and can act on it.
Blockchain Technology And What Can It Do To Improve Manufacturing And Food TraceabilityWhat is blockchain and why it is described as a technology that is transforming supply chain management
In the simplest terms, blockchain is the collection of the linked blocks of encrypted transaction data, which are immutable and are very hard to tamper with.
Each new block is cryptographically linked to the previous one, so it is impossible to change transaction data after the fact without breaking the chain and render the altered block invalid.
Manufacturing and food production process is naturally aligned with the linked blockchain transactions. Each time product batch is created, is moved to the next production step, combined with the other components to form an assembly, or transferred to the next supply chain partner, a transaction is created and added to the blockchain. All supply chain parners who are allowed access to this blockchain channel can trace each product batch back to the origin and access all traceability information based on the recorded blockchain transactions.
This is the reason why supply chain management and traceability are the most prominent use cases among business applications of the blockchain technology.
Public, private and consortium blockchain networks.
The original digital currency blockchain networks are public - meaning that any person can join it. Blockchain networks for business (practically all of which are based on one of the Hyperledger frameworks) are usually private or consortium. Each network defines it's rules on who can submit the transactions. Different blockchain frameworks have different access control, but all of them can ensure that only authorized users can submit and access blockchain data. Unlike traditional business software, which is used by a single company, business blockchain network are often formed by consortium - a network of companies that are doing business together and are recording business transactions within a network.
How does blockchain work and what makes it secure and tamper-proof?
Transactions on the blockchain are organized in blocks. Each block has its own unique digital signature, which is calculated based on the data in the block. This signature is added as data to the next block, and is included in this block signature calculation, etc. In other words, each subsequent block contains a signature of the previous one - that's how the blocks of transactions data in a blockchain are linked.
If data are changed in any of the blocks, this block signature changes as well, and it is no longer linked to the rest of the chain. In order to change the data and preserve linking of the blocks, each subsequent block and data should be changed, which makes this task practically impossible.
How does blockchain network defines what is included in the transaction and what happens after transaction is submitted?
How does it all help manufacturing and food companies with the supply chain management and traceability?
The supply chain is by definition a network of companies who collectively work on a product, starting from raw materials end ending with the finished product sold to the end customer. Through various stages of production components and intermediate products are transferred from one supply chain link (company) to the next. The production process, including product movement through the manufacturing process steps, and from one company to the next is naturally aligned with the linked blockchain transactions.
Currently, all companies in a supply chain network are using their own internal ERP software systems, so there is no transparency and traceability across the entire network. Blockchain technology can solve this problem by enabling end to end product traceability, where each company can enter its own data and access an entire traceability trail.
Many companies are concerned about integrity of the system that is not entirely under their control, and therefore can be skeptical towards implementing a single traceability system for the entire supply chain network. Immutability and tamper-proof nature of the blockchain alleviates this concern.
Using Blockchain Technology For Manufacturing And Food Traceability: Positives And NegativesWhat are the best traceability technologies for the small to medium size manufacturers and food manufacturers, and how does blockchain fits in
Blockchain has been discussed as a breakthrough technology for business in general, and for the supply chain and traceability specifically, for some time now (at least since 2016). However, as of now (fall of 2019) blockchain technology is still perceived as a technology for the large corporations, rather than something that can be used by medium or small size manufacturing or food-related business. Is this assessment correct, and will small / medium businesses benefit from using blockchain based traceability solution? The reality is, blockchain technology has its positives and negatives. The idea is to take the positives, try to mitigate the negatives and combine blockchain with other modern technologies for an optimal traceability solution.
Blockchain Technology -- Pluses
These are the main positive aspects of blockchain technology as related to the supply chain management and traceability:
- Ability to track product batches and serialized inventory through the entire supply chain network, across corporate boundaries
- Immutable and secure nature of the blockchain, so that transaction records cannot be altered by any of the parties or falsified
- Ability to track any data and establish rules of accepting / rejecting transactions
- Ability (optional) to present a "product story" to the end customer
Blockchain Technology -- Minuses
Blockchain technology by itself is not very usable due to the following limitations:
- Very limited search and data look up capabilities
- Search and data retrieval is rather slow
In other words, for the functional business application blockchain should be combined with the "off-chain" data storage for fast and easy data retrieval and look up. Off-chain storage is usually done in NoSQL database, as these databases allow storage of flexible data and can grow as needed. This way all supply chain network companies can submit data, search and retrieve data as needed, and there is a secure, tamper-proof immutable chain of all recorded transactions.
Using Mobile Technology For Traceability
Blockchain technology solves the problem of products tracking and traceability across corporate boundaries. However it does nothing to eliminate amount of the physical paperwork and manual entries that are required to track each product lot and serialized inventory through the manufacturing process, and collect data. Not only such manual, paper and pencil or spreadsheet process is very inefficient, it also produces a lot of errors and makes it very hard to find required information when needed. The answer to this problem is mobile technology.
Mobile data collection and mobile forms solutions allow company employees to track product batches through the manufacturing process and collect all required information on the shop floor, in real time using mobile devices (smartphones or tablets). Mobile devices are used for barcode scanning, tracking product batches movement through the process, collecting data and observations using mobile forms.
Collecting traceability data on the mobile devices makes the process much faster, error-free, ensures that your employees can easily do it without being distracted from their main responsibilities, and provides real time information to all authorized users.
Combining blockchain, mobile and cloud technologies for an optimal traceability solution
Here, at AHG, we have been working with manufacturing and food processing clients on implementing inventory management and traceability solutions for over five years. We realize the need for a simple and flexible traceability solution, that employees could use on the shop floor or warehouse in real time and that won't distract them from their main job tasks. In real life, multiple companies are involved in building a product while it progresses from raw materials through intermediate products to the final product that ends up in the consumer hands. Therefore, it is also important that traceability information could be collectively accumulated and accessed by all companies that are involved in the product building, transportation, delivery and selling to the end client.
Our new traceability solution, Shared Traceability, is done with these ideas in mind. It is a simple solution that requires no setup, allows employees to collect any required data on the shop floor using mobile devices, and uses blockchain technology to allow sharing of traceability information with supply chain partners. Here is what you will be able to do using Shared Traceability:
- Record everything that happens with the product batch, serialized inventory or an asset as blockchain transaction
- Record producing or receiving components and raw material batches
- Record product movement through the production process
- Record building of assemblies, generic and serialized
- Record products conversions and splitting during the manufacturing process
- Record observations during the process stages (various measurements, what was done, etc.)
- Enter any information you need into the system
- Do all tracking on the shop floor, using mobile devices for barcode / QR code scanning and data entry
- All information submitted from the mobile devices is immediately available to all authorized users
- Review details and the entire history of each product batch by scanning QR code, or via the web dashboard
- Review composition of each product batch, drill down through sub-assemblies to individual products, review all history and data for each with one click
- Quickly find where a specific product lot had been used, and where it was distributed
- Invite downstream and upstream supply chain partners to join the network, and share traceability information across the entire supply chain channel
- Optionally let an end user to scan QR code and review a "product story"
- Use together with QR Inventory for more comprehensive internal inventory management and traceability, or as a stand alone traceability solution.
If you are interested in implementing Shared Traceability and would like to get more information or try it out please let us know.