Today IBM announced that it’s partnering with blockchain developer Chainyard for a new Trust Your Supplier blockchain. Apart from IBM itself, the first external participants in the supplier management blockchain include Budweiser owner Anheuser-Busch InBev, Cisco, GlaxoSmithKline, Lenovo, Nokia, Schneider Electric and Vodafone.
The blockchain aims to address the issue of managing suppliers and their qualifications. Supplier credentials need to be checked and validated, they need to be onboarded, and there’s an entire life cycle management.
Trust Your Supplier will behave like a digital passport. So suppliers can share their information with multiple permissioned buyers in the network. Hence it should save time for both buyers and suppliers. The announcements states that third-party validators and auditors are participating in the network including Dun & Bradstreet, Ecovadis and RapidRating.
An example of the challenges companies face with suppliers was previously articulated to Ledger Insights by Novartis (which is not part of this project). “We want to ensure that the labor practices, that the environmental practices, the quality standards and things like this for all our suppliers, and our suppliers’ suppliers in a multi-tier supplier network are meeting our standards. It’s hard to create this transparency when you have to rely on your own audits.”
In the case of pharma companies, you can imagine the same company enduring audits for all its customers. In fact, the pharmaceuticals industry has a Pharma Supply Chain Initiative (not blockchain) to share audits reports.
The Trust Your Supplier platform can be integrated with the cloud-based IBM Supply Chain Business Network. IBM plans to use the platform itself onboarding 4,000 North American suppliers in the coming months. It is anticipating a 50 percent time-saving in onboarding suppliers.
The new blockchain is currently in limited availability with plans for a full roll out in the third quarter.
Last year, the Asian Development Bank explored creating a blockchain-based e-Government procurement platform. The idea was to create a global database of suppliers with a shared authenticated log of work experience certificates.
Several verification companies have also invested in blockchain. For example, DNV GL has invested in VeChain and testing laboratory SGS is a participant in commodity trade finance platform Komgo.
Other solutions are targeting this and related areas. For example, Icertis, the contract lifecycle management company has a blockchain. And Deutsche Bahn is also using blockchain for supplier contracts.
