Coca Cola, the global soda giant is now using a blockchain supply chain solution, which is from SAP, the global technology giant. Coke One North America (CONA), the technology company that manages the IT operations for Coca Cola has started to use this solution recently.
This recent development confirms the growing clout of blockchain in supply chain management. At the same time, it also shows how technology giants are pushing ahead with blockchain to solve key business problems.
The global supply chain market is massive, however, supply chain management is complex. Market research reports state that 69% of the businesses didn’t have the complete visibility of their supply chains in 2017.
The supply chain management function faces multiple challenges globally, and these are as follows:
- Cost escalation;
- High complexity;
- The increased demand for improved speed, quality, and service;
- Higher risk due to the growing complexity;
- Supply chain volatility.
Blockchain can make a difference here with its decentralization, distributed ledger, and security features. Digital signatures, data encryption, and consensus algorithms are the key security features of blockchain that protect data against tampering.
Its distributed ledger makes information sharing easy, moreover, it promotes transparency. Smart contracts running on blockchain networks are transparent and tamper-proof, moreover, they execute autonomously. They can improve contract administration, thereby improving efficiency further.
Blockchain supply chain management – making a difference
Blockchain can improve supply chain management in various ways, e.g.:
- Provenance tracking;
- Cost reduction;
- Eliminating fraud;
- Establishing trust;
- Improving inventory management.
It’s no surprise then that the global market for blockchain supply chain solutions is growing. This market was worth $85.7 million in 2018, however, as market research reports state, it will reach $2.675 million in 2024.
Coke One North America (CONA) manages massive transaction volumes involving manufacturing, bottling, and shipping. The company manages over 160,000 orders of various Coca-Cola products per day, therefore, it’s no wonder that it’s looking for efficiency.
CONA has analyzed and concluded that many of the transactions involve multiple companies, moreover, many steps involve intermediaries. With the blockchain solution from SAP, CONA intends to bring in the much-needed efficiency.
CONA will now get real-time insights into transactions involving different stakeholders, thanks to the inter-organizational blockchain network they have implemented for Coca Cola. The expected benefits are impressive, e.g., CONA expects to reduce the duration of the order-reconciliation process from 50 days to only a few days.
Coca Cola isn’t the only global giant to turn to blockchain for improving their supply chain management. Walmart has joined a blockchain-powered pharma supply chain project, moreover, it will use blockchain for shrimp supply chain management.
SAP: A player to watch for in the blockchain space
SAP already has considerable blockchain capability, and the company is already working with Lufthansa to use blockchain in the aviation industry. The foray by SAP into blockchain supply chain management augurs well for the industry.
