By Rajesh Kandaswamy
What if a car automatically negotiated its own insurance rate, or if central banks were no longer needed to verify payments? What if neighbors could buy power directly from their respective solar panels? What would happen if a contract applied its own terms?
These scenarios may seem too futuristic, but the reality of blockchain could make them all possible. The most important question is how these changes could affect the business and how can the organization benefit from this technology?
Few companies have deployed blockchain, but this one may have a significant impact across large parts of the business. The low adoption rate of blockchain technologies has many CIOs thinking they don’t have to take action yet, but the opportunities for these technologies are huge.
Only 4% of enterprises expect blockchain to be a game-changer, according to Gartner’s 2019 CIO survey. Furthermore, only 11% of companies have deployed blockchain-inspired technologies, even minimally. CIOs need to start thinking about added value blockchain can bring to their organization and how to meet the challenges that will arise over the next five years.
Reality #1: Blockchain offers a range of possibilities that evolve over time
Blockchain is not a monolithic technology. The term “blockchain” actually encompasses a wide range of technologies, from smart contracts to tokens to consensus models that will continually evolve and become available. In turn, CIOs should plan for the gradual evolution of their own blockchain strategies.
Blockchain technologies are divided into four phases on the Gartner Spectrum:
1. The enabling blockchain: These are the building blocks of blockchain, including encryption and consensus algorithm, distributed computing infrastructure, tokens and others.
2. The Inspired Blockchain: Technologies at this stage combine some elements of blockchain, but lack two fundamental elements: decentralization and unit segmentation.
3. The complete blockchain: These solutions include the five elements of the blockchain. They are decentralized, immutable, encrypted, segmented into units and distributed.
4. The Improved Blockchain: In addition to the five blockchain elements, blockchain enhancement is combined with technologies such as Artificial Intelligence (AI) and Internet of Things (IoT) for smarter solutions.
Reality #2: Blockchain may change your operating model, but not necessarily your business model, in the next 5 years
Although blockchain will eventually change the core of a business, over the next five years it will mostly affect how the organization runs its business. Focusing solely on how blockchain is used today (i.e. efficiency and record keeping) is limiting. CIOs need to look for opportunities to take advantage of blockchain technology to drive deeper change that can drive real business value.
Start by researching areas where blockchain could strengthen the value proposition of the organization and come up with projects that could really differentiate it. Think carefully about how this technology could benefit the business, as opposed to buying a “disruptive” program.
Reality #3: Blockchain offers the opportunity to create a multi-benefit digital economy
It’s time to think creatively about unit segmentation and the numerical representation of assets in the market. For some organizations it will increase efficiency, and for others it will open up entirely new markets. Consider the utility of unit segmentation in current and future business operations, and discuss with ecosystem partners the potential and challenges of unit segmentation.
Reality #4: Blockchain Enables a New Society, But Doesn’t Solve Trust Issues at Every Level
One of the main elements of blockchain is decentralization. It removes central authorities from the process and allows a certain level of trust between two parties who have never done business together. This means that the definition of participant will expand beyond individuals and enterprises to include smart contracts, distributed ledgers, related items, and data access objects.
The blockchain will facilitate the interactions between all these participants and allow the emergence of a new society, but it cannot solve all the problems of trust. For example, any asset that is physical or not entirely digital would gain a limited trust value (if any). Create a plan that highlights potential gaps and pain points, and don’t oversell blockchain technologies to senior executives as a solution to every problem.
Reality #5: The programmable economy will set the conditions for competition in the future
The reality is that blockchain and its fundamentals will dramatically change not only the business world, but also the world in which businesses operate. Blockchain will enable autonomous e-commerce and eventually a programmable economy.
A programmable economy results from the decentralized application of distributed computing resources, such as blockchain at scale, to support exchanges of monetary and non-monetary value between people, organizations, and artificial agents that have legal status. equivalent to that of today’s societies and individuals. This situation will eventually evolve into a digital society, as consumers change their behavior and adopt new practices. Organizations will need to develop the technology, but also ethics and practices to exist in the digital society.
Rajesh Kandaswamy is Vice President of Research and Gartner Fellow. He specializes in the field of research on technology and service providers. His responsibilities include helping set the direction of research on emerging technologies and industries, as well as co-leading enterprise-scale blockchain research at Gartner. His research work within the Gartner program focuses on how technology will radically transform the concept of an organization.
Tags: Blog, blockchain, DSI, ZoneGartner
We wish to give thanks to the writer of this write-up for this outstanding content
CIOs Can’t Ignore These 5 Blockchain Realities | Informatic direction
Explore our social media profiles as well as other pages related to themhttps://metfabtech.com/related-pages/