Blockchain and supply chain management integration: a systematic review of the

literature: Purpose – This paper aims to identify, analyse and organise the
literature about blockchains in supply chain management (SCM) context (blockchain–
SCM integration) and proposes an agenda for future research. This study aims to
shed light on what the main current blockchain applications in SCM are, what the
main disruptions and challenges are in SCM because of blockchain adoption and what
the future of blockchains holds in SCM.
Design/methodology/approach – This study followed the systematic review approach to
analyse and synthesise the extant literature on blockchain–SCM integration. The
review analysed 27 papers between 2008 and 2018 in peer-reviewed journals.
Findings – Blockchain–SCM integration is still in its infancy. Scholars and
practitioners are not fully aware of the potential of blockchain technology to
disrupt traditional business models. However, the electric power industry seems to
have a relatively mature understanding of blockchain–SCM integration, demonstrated
by the use of smart contracts. Additionally, the disintermediation provided by
blockchain applications has the potential to disrupt traditional industries (e.g.
health care, transportation and retail).
Research limitations/implications – The limitations of this study are represented
mainly by the scarcity of studies on blockchain–SCM integration in leading journals
and databases.
Practical implications – This study highlights examples of blockchain–SCM
integration, emphasising the need to rethink business models to incorporate
blockchain technology.
Originality/value – This study is the first attempt to synthesise existing
publications about the blockchain–SCM integration, shedding light on the disruption
caused by, and the necessity of, the SCM reconfigurations.
Blockchain and Supply Chain Management: A New Paradigm for Supply Chain Integration
and Collaboration: Despite there are some arguments about blockchain, it has been
highlighted as an important distributed secure technology in the 21st century. It
is an incorruptible digital ledger of economic transactions that can be programmed
to record not just financial transactions but virtually everything of value.
Dobrovnik et al. (2018) suggest that blockchain is a revolutionising technology
that would change industries at an international level, add values to firms and
supply chain networks, improve commerce, and drive economy. Although blockchain has
attracted attentions, very few blockchain studies have been focussed on supply
chain integration and collaboration areas. This study illustrates the possibilities
of applying blockchain technology in the coordination of activities for effective
and efficient supply chain management. The study takes a closer look at the use of
blockchain in supply chains beyond cryptocurrency, payment, and finance via the use
of smart contract and consensus algorithm (i.e., imposing constraints). The key
attributes of blockchain are discussed and potential questions were identified in
New Zealand. The expected outcome of this study will advance the understanding of
the blockchain and supply chain literature, besides inspire both researchers and
practitioners to consider the use of blockchain in different context-aware future
studies.
Blockchain in supply chain management: a review, bibliometric, and network
analysis: Blockchain is a distributed ledger technology that has attracted both
practitioners and academics attention in recent years. Several
conceptual and few empirical studies have been published focusing on addressing
current issues and recommending the future
research directions of supply chain management. To identify how blockchain can
contribute to supply chain management, this
paper conducts a systematic review through bibliometric and network analysis. We
determined the key authors, significant
studies, and the collaboration patterns that were not considered by the previous
publications on this angel of supply chain
management. Using citation and co-citation analysis, key supply chain areas that
blockchain could contribute are pinpointed
as supply chain management, finance, logistics, and security. Furthermore, it
revealed that Internet of Things (IoT) and smart
contracts are the leading emerging technologies in this field. The results of
highly cited and co-cited articles demonstrate that
blockchain could enhance transparency, traceability, efficiency, and information
security in supply chain management. The
analysis also revealed that empirical research is scarce in this field. Therefore,
implementing blockchain in the real-world supply
chain is a considerable future research opportunity
Blockchain technology: implications for operations and supply chain management:
Purpose – This paper aims to encourage the study of blockchain technology from an
operations and supply chain management (OSCM) perspective, identifying potential
areas of application, and to provide an agenda for future research.
Design/methodology/approach – An explanation and analysis of blockchain technology
is provided to identify implications for the field of OSCM. Findings – The hype
around the opportunities that digital ledger technologies offer is high. For OSCM,
a myriad of ways in which blockchain could transform practice are identified,
including enhancing product safety and security; improving quality management;
reducing illegal counterfeiting; improving sustainable supply chain management;
advancing inventory management and replenishment; reducing the need for
intermediaries; impacting new product design and development; and reducing the cost
of supply chain transactions. The immature state of practice and research
surrounding blockchain means there is an opportunity for OSCM researchers to study
the technology in its early stages and shape its adoption. Research
limitations/implications – The paper provides a platform for new research that
addresses gaps in knowledge and advances the field of OSCM. A research agenda is
developed around six key themes. Practical implications – There are many
opportunities for organisations to obtain an advantage by making use of blockchain
technology ahead of the competition, enabling them to enhance their market
position. But it is important that managers examine the characteristics of their
products, services and supply chains to determine whether they need or would
benefit sufficiently from the adoption of blockchain. Moreover, it is important
that organisations build human capital expertise that allows them to develop,
implement and exploit applications of this technology to maximum reward.
Originality/value – This is one of the first papers in a leading international OSCM
journal to analyse blockchain technology, thereby complementing a recent article on
digital supply chains that omitted blockchain.
Blockchain Technology in Supply Chain Management: An Application Perspective: Given
the hype around the cryptocurrency Bitcoin, blockchain technology (BCT) has also
received considerable attention outside the financial sector. Multiple applications
of BCT in supply chain management (SCM) are discussed in business practice and
there is increasing interest in this topic within the academic community. In this
paper, we intend to combine these two perspectives on BCT in SCM to summarize a
current state of the art and to derive avenues for further research. For this
purpose, a comprehensive framework of use case clusters of BCT in SCM is developed
according to the distinctive features of BCT. The framework is used to analyze 53
applications of BCT in SCM which are derived from a systematic literature review
and a secondary dataset of blockchain-driven innovations in SCM. We identify five
emerging use case clusters of BCT in SCM which clearly extend the scope beyond
frequently mentioned applications such as product tracking and tracing
Blockchain technology and its relationships to sustainable supply chain management:
Globalisation of supply chains makes their management and control more difficult.
Blockchain technology, as a distributed digital ledger technology which ensures
transparency, traceability, and security, is showing promise for easing some global
supply chain management problems. In this paper, blockchain technology and smart
contracts are critically examined with potential application to supply chain
management. Local and global government, community, and consumer pressures to meet
sustainability goals prompt us to further investigate how blockchain can address
and aid supply chain sustainability. Part of this critical examination is how
blockchains, a potentially disruptive technology that is early in its evolution,
can overcome many potential barriers. Four blockchain technology adoption barriers
categories are introduced; inter-organisational, intra- organisational, technical,
and external barriers. True blockchain-led transformation of business and supply
chain is still in progress and in its early stages; we propose future research
propositions and directions that can provide insights into overcoming barriers and
adoption of blockchain technology for supply chain management.
BLOCKCHAIN AND SUPPLY CHAIN MANAGEMENT: AIRCRAFTS’ PARTS’ BUSINESS CASE: To serve
target customers better than their competitors, supply chain management (SCM) teams
today look into new technologies such as Big Data, Internet of Things (IoT) and
Blockchain. These new technologies allow managers to develop and provide complex
supply chain services and products faster with improved reliabilities. With these
technologies, SCM teams can build complex models of a supply chain or systems of
supply chains using a data-driven approach. With the growth of aviation domain
across the world, there has been increasing demand in aircraft for airlines and
other customers. In this domain, SCM teams deal with complex networked supply
chains for aircraft’s spare part purchase and delivery for aircraft’s maintenance
and repair. Aircraft’s spare parts are shipped to single assembly hubs, located
globally. All parts come with certain life expectancy, specific requirements and
maintenance attributes. With thousands of spare parts, hundreds of parameters, and
number of manufactures distributed globally, SCM team need to deal with very large
amount of data. In this paper, we use an industrial scenario of aviation industry
SCM to demonstrate the necessity of having decentralized system based on
distributed data-driven application technologies such as Blockchain, not only to
assist in maintaining inventory of the aircraft’s parts but also to monitor the
performance, usage, etc. This will help to achieve a transparent network of supply
chain for aircraft’s parts and reduce the risk of availability of aircraft’s parts
in black market. These new data-driven technologies when embedded into SCM
scenarios will help the SCM managers to analyse the supply, demands, source of
availability of spare parts and provide methods to procure them from the right
sources.
When Blockchain Meets Supply Chain: A Systematic Literature Review on Current
Development and Potential Applications: This study aims to explore the current
status, potential applications, and future directions of blockchain technology in
supply chain management. A literature survey, along with an analytical
review, of blockchain-based supply chain research was conducted to better
understand the trajectory of related research and shed light on the benefits,
issues, and challenges in the blockchain-supply-chain paradigm. A selected corpus
comprising 106 review articles was analyzed to provide an overview of the use of
blockchain and smart contracts in supply chain management. The diverse industrial
applications of these technologies in various sectors have increasingly received
attention by researchers, engineers, and practitioners. Four major issues:
traceability and transparency, stakeholder involvement and collaboration, supply
chain integration and digitalization, and common frameworks on blockchain-based
platforms, are critical for future orientation. Traditional supply chain activities
involve several intermediaries, trust, and performance issues. The potential of
blockchain can be leveraged to disrupt supply chain operations for better
performance, distributed governance, and process automation. This study contributes
to the comprehension of blockchain applications in supply chain management and
provides a blueprint for these applications from the perspective of literature
analysis. Future efforts regarding technical adoption/diffusion, block-supply chain
integration, and their social impacts were highlighted to enrich the research
scope.
The power of a blockchain-based supply chain: A supply chain is a system of
organizations, people, activities, information and resources involved in moving a
product or service from supplier to customer. It is designed to maintain the
quality of sensitive goods during the whole shipment. Centralized supply chain
management systems expose the supply chain to corruption, fraud, and tampering.
Blockchain has emerged as a new distributed information technology; it represents a
new ap- proach in supply chain area, where visibility and transparency of product
flows are the principal challenges. This paper describes how the blockchain can be
integrated into the supply chain architecture to create a reliable, transparent,
authentic and secure system. To reach this goal, we studied the benefits of
introducing the block- chain to the supply chain and the challenges encountered in
a blockchain-based supply chain management ecosystem. We combined theoretical and
real-world application studies to build our theory about the require- ments for an
efficient blockchain-based supply chain.
Blockchain and Supply Chain Management: Many authors have explored the potential
impact of blockchain on supply chain management, and indeed, many articles in the
popular press extol the potential of blockchain to impact the supply chain. In this
white paper, we argue that while blockchain does have some potential to impact
supply chains in the short term, many of the potential blockchain-enabled supply
chain impacts will require signif- icant research advances. We identify four
categories of issues that researchers must address in order for many of the
interesting proposed blockchain-enabled supply chain use cases to be feasible. If
these issues are addressed, we have little doubt that the potential of blockchain-
enabled supply chain is enormous.
An analysis of Blockchain in Supply Chain Management: System Perspective in Current
and Future Research: Purpose: This study aims to review the current academic
research on blockchain, especially in the fields of business and economics. Based
on a systematic review of literature retrieved from the Web of Science service, the
researchers explore the top-cited articles, the most productive countries, and the
most common keywords. Methodology: This research conducts a clustering analysis and
identifies the following five research themes: “economic benefit,” “blockchain
technology,” “initial coin offerings,” “fine tech revolution,” and “sharing
economy.” Findings: It showed that the most common subject area is Computer
Science, following research by Engineering, Telecommunications, and Business and
Economics. With regard to Business and Economics, several key nodes have been
identified in the literature, such as the top-cited articles, most productive
countries.
Blockchain for the future of sustainable supply chain management in Industry 4.0:
The objective of this study is to provide an overview of Blockchain technology and
Industry 4.0 for advancing supply chains towards sustainability. First, extracted
from the existing literature, we evaluate the capabilities of Industry 4.0 for
sustainability under three main topics of (1) Internet of things (IoT)-enabled
energy management in smart factories; (2) smart logistics and transportation; and
(3) smart business models. We expand beyond Industry 4.0 with unfolding the
capabilities that Blockchain offers for increasing sustainability, under four main
areas: (1) design of incentive mechanisms and tokenization to promote consumer
green behavior; (2) enhance visibility across the entire product lifecycle; (3)
increase systems efficiency while decreasing development and operational costs; and
(4) foster sustainability monitoring and reporting performance across supply chain
networks. Furthermore, Blockchain technology capabilities for contributing to
social and environmental sustainability, research gaps, adversary effects of
Blockchain, and future research directions are discussed.
How Blockchain Enhances Supply Chain Management: A Survey: Providing transparency
and trust among participants and stakeholders and ensuring an efficient operation
are current supply chain challenges. These challenges are difficult to resolve
because the records of supply chains may be exposed to alterations by participants.
Blockchain technology has been identified as a promising solution to resolve these
challenges. In this paper, we introduce blockchain and survey recent blockchain
frameworks that address some of the supply chain challenges. We describe the
components and operation of these blockchain frameworks. We identify the objectives
and motivation in each of the surveyed use cases and highlight the advantages and
disadvantages of each adopted framework. We analyze how the reported blockchain
frameworks address different supply chain challenges. We present a comparative
summary of existing literature on blockchain for supply chain. We also summarize
the properties of a blockchain framework for its successful adoption in future
supply chains and discuss several remaining challenges and opportunities.
An exploration of blockchain technology in supply chain management: Day by day new
technologies are applied to the business environment. Since the start of the fourth
industrial revolution, the digital tools allow productivity improvement. Different
kinds of technologies have been used to support companies in tasks of sending and
receiving information. The information exchanged between companies has always being
a concern when having in mind trust, speed, and safety. During few decades, EDI
(electronic data exchange) was the main technology supply chain professionals used
to send and receive information. Recently, with the rise of the fourth industrial
revolution and the Internet of Things (IoT), many aspects of the business
environment have changed. Individuals and organizations are required to be more
productive. One of the mainstreams for the business environment is blockchain. Some
researches argued that bitcoin is the pioneer of blockchain technology. Financial
companies joined forces to build a technological infrastructure to use the
cryptocurrency on the market. The first blockchain conceived in 2008, in the wake
of the global financial crisis and it has never been hacked. Supply chains are
complex networks of distant, separate entities that exchange goods, payments, and
data across a dynamic, continuously evolving landscape. Blockchain technology
allows visibility providing the customer the opportunity to understand how the
supply chain works and how to get more information about products traceability.
However, there are some challenges to implement blockchain in logistic and supply
chain. The paper presents a theoretical review including the principles of the
blockchain operations and the required infrastructure to implement it. The paper
does not cover the technology architecture applied to the blockchain. The potential
benefit of the blockchain will be covered to understand how to apply it in
logistics and in the supply chain environment, presenting some examples already
implemented or identified.
Leveraging the Internet of Things and Blockchain Technology in Supply Chain
Management: Modern supply chains have evolved into highly complex value networks
and turned into a vital source of competitive advantage. However, it has become
increasingly challenging to verify the source of raw materials and maintain
visibility of products and merchandise while they are moving through the value
chain network. The application of the Internet of Things (IoT) can help companies
to observe, track, and monitor products, activities, and processes within their
respective value chain networks. Other applications of IoT include product
monitoring to optimize operations in warehousing‚ manufacturing, and
transportation. In combination with IoT, Blockchain technology can enable a broad
range of different application scenarios to enhance value chain transparency and to
increase B2B trust. When combined, IoT and Blockchain technology have the potential
to increase the effectiveness and efficiency of modern supply chains. The
contribution of this paper is twofold. First, we illustrate how the deployment of
Blockchain technology in combination with IoT infrastructure can streamline and
benefit modern supply chains and enhance value chain networks. Second, we derive
six research propositions outlining how Blockchain technology can impact key
features of the IoT (i.e., scalability, security, immutability and auditing,
information flows, traceability and interoperability, quality) and thus lay the
foundation for future research projects.
Potential of blockchain technology in supply chain management: a literature review
Purpose – The purpose of this paper is to review the existing literature on
blockchain technology, present some trends and consider its potential value in
supply chain management (SCM).
Design/methodology/approach – Papers that contained the word “blockchain” in their
titles, keywords or abstracts were selected for conducting trend analyses.
Findings – The blockchain technology is rapidly making inroads in many industries
and there is tremendous potential to eliminate intermediaries and to make SCM more
efficient.
Research limitations/implications – This analysis is limited to 299 papers from the
EBSCO database through December 2018.
Practical implications – This paper highlights the imperative role of blockchain
technology that has created a discourse in the world of innovation and technology.
This work will help academics to further the understanding of blockchain
technology.
Social implications – Blockchain technology will provide transparency to consumers.
Originality/value – This paper presents the first review of blockchain technology
and delves into its value in SCM. This work will help researchers in identifying
the areas where blockchain is the most desirable and can be implemented.
Keywords Blockchain, Smart contract, E-commerce, Global sourcing, Supply-chain
management,
Logistics management, Disruptive technology Paper type Literature review
Blockchain as the “trust-building machine” for supply chain management
This paper aims to investigate the impact of blockchain application on trust levels
in supply
chains. Through the systematic review of the relevant literature, three dimensions
of trust,
i.e., the trustor–trustee perspective, forms of trust, and time orientation, are
investigated. Our
findings show that, first, there are three pairs of trustors and trustees involved
in blockchain
implementation: (a) the user and the blockchain, (b) two supply chain partners, and
(c) the
consumer/public and a supply chain unit. Second, the two forms of trust, namely
cognition based and institution-based trust, are likely to be enhanced by
blockchain execution, while
affect-based trust may not be directly impacted by the technology. Third, the
presence of
blockchain technology would facilitate swift trust-building between unknown supply
chain
partners under specific circumstances. Moreover, we also find contradicting
assertions among
scholars on the implications of blockchain for trust in supply chains. While some
studies pointed out that blockchain will enable a trustless trusted scheme, others
expected the
reinforcement of interorganizational trust. To test these assertions, we develop
the blockchain entrusted supply chain models to present the three-step process of
how trust is developed
through the blockchain and diffused to supply chain partners and external
stakeholders.
Critical success factor analysis of blockchain technology in agri-food supply chain
management: A circular economy perspective
In the sustainability system, which gives importance to the availability of
resources, recycling, renewal, and reproduction strategies can be handled under the
name of the circular economy. While there are many stages to be followed from food
production to consumption and even recycling, one of the technologies that will
contribute to the circular economy that can take an active role in these stages is
blockchain technology. In this study, which is about the circular economy in
sustainable supply chain management, the contribution of blockchain technology to
agri-food supply chain management is discussed. The aim of the study is to
research, analyze and prioritize the critical success factors of the use of
blockchain technology for the agri-food sector on the way to the circular economy.
As a first step, with the help of PESTEL analysis approach, 12 critical success
factors for agri-food supply chain management under the political, economic,
social, technological, environ- mental, and legal dimensions of blockchain
technology within the scope of circular economy are determined. Analytic Network
Process (ANP) and MultiAtributive Ideal-Real Comparative Analysis (MAIRCA) methods
are used in an integrated way to consider the degree of influence between the
factors and to determine the ideal optimal factor. In the results, it is determined
that the political and technological sub-criteria of blockchain technology is
determined, and it is observed that the criteria handled in line with the
sustainability system are compatible with the perspective of reducing the waste of
resources of the circular economy. If blockchain technology is used in the agri-
food sector, it has been determined that it will contribute to the circular economy
with the success factors in this study. “Ability to prevent food waste”; “Increased
food security”; “Product life- cycle tracking” factors take priority in their
ranking.

Uncovering dimensions of the impact of blockchain technology in supply chain

management
Supply chains around the globe are faced with difficulties and disruptions due to
the worldwide pandemic situation and digital solutions are needed. There is
significant research interest in the implementation of blockchain technology (BCT)
for supply chain management (SCM). A challenge that remains is analyzing the
interactions of BCT in different areas of SCM. This study aims to identify the
influential dimensions of the impact of BCT adoption in SCM and to discuss the
synergetic and counter-synergetic effects between these dimensions. Advantages,
disadvantages, and constraints of adopting BCT in the SCM context are explored
through a systematic literature review, which provides the foundation for
identifying the dimen- sions of impact. The interactions between these dimensions
are conceptually discussed. This study introduces three dimensions of the impact of
implementing BCT in SCM: ‘operations and processes’, ‘supply chain relationships’,
and ‘innovation and data access’. These dimensions are interrelated and have
overlapping areas within them, which leads to synergetic and counter-synergetic
effects. The overlaps and synergies of the three dimensions of impact are
illustrated, and the virtuous and vicious cycles of BCT adoption in SCM cases are
highlighted. This study assists scholars and practitioners by clarifying the
synergetic relationships within the dimensions of the impact of BCT in SCM and by
providing considerations to prevent undesirable effects and expand desired ones.

Blockchain in supply chain management: A review of efficiency, transparency, and

innovation
As global supply chains become increasingly complex, traditional systems face
challenges in ensuring efficiency, transparency, and innovation. Block chain
technology has emerged as a transformative force in addressing these issues,
offering a decentralized and secure framework for supply chain management. This
paper presents a comprehensive review of the impact of block chain on supply
chains, focusing on its potential to enhance efficiency, transparency, and foster
innovation. The efficiency gains facilitated by block chain in supply chain
management are examined through the elimination of intermediaries, reduction of
paperwork, and real-time visibility into the entire process. These improvements
result in streamlined operations, reduced costs, and enhanced responsiveness to
market dynamics. Moreover, block chain’s decentralized nature ensures data
integrity, mitigating the risk of fraud and errors in the supply chain.
Transparency is a critical aspect of modern supply chains, and block chain provides
an immutable and transparent ledger that enables end-to-end visibility. The
technology ensures traceability and accountability, allowing stakeholders to access
real-time information about the origin, movement, and status of products. This
transparency not only enhances trust among supply chain participants but also
facilitates compliance with regulatory requirements. The role of block chain in
fostering innovation within supply chains is explored, emphasizing its potential to
enable new business models, collaborative ecosystems, and the integration of
emerging technologies such as the Internet of Things (IoT) and Artificial
Intelligence (AI). The paper highlights case studies and pilot projects where block
chain has been successfully applied to drive innovation in supply chain processes.
Challenges and considerations related to the implementation of block chain in
supply chain management are also discussed, including interoperability,
scalability, and regulatory issues. The paper concludes by outlining future
research directions and emphasizing the need for industry-wide collaboration to
unlock the full potential of block chain in revolutionizing supply chain
management. Overall, this review contributes to the understanding of how block
chain can serve as a catalyst for efficiency, transparency, and innovation in
contemporary supply chains

An IoT and Blockchain-Based Secure and Transparent Supply Chain Management

Framework in Smart Cities Using Optimal Queue Model
The process of controlling the flow of products and services from a company by
encompassing each stage involved in transforming raw materials and parts into
finished items, also delivering them to the final consumer is known as Supply Chain
Management (SCM). The development of numerous smart city applications including
smart grids, smart homes, smart supply chains, and smart healthcare has drawn
attention to the Internet of Things (IoT). Nowadays, researchers are considering
the smart healthcare system’s role as a Public Emergency Service (PES) to treat
patients promptly. A distributed smart fire brigade system receives little
attention like PES to save lives and property from catastrophic fire damage. The
conventional PES methods are created using a centralized method that needs a lot of
processing power and doesn’t offer timely services. The traditional systems
developed for managing the supply chain have drawbacks like single- point failure
issues, data integrity, transparency, and lack of trust. To alleviate the existing
issues, in this paper, a Blockchain and IoT Enable Secure and Transparent Supply
Chain Management framework is utilized for PES in the smart city environment.
Further, two edge computing servers, like a service controller and an IoT
controller are adapted. The local storage is handled by the service and IoT
controller. Thus, it enhances the data processing speed of PES requests and PES
fulfillment. The service controller utilizes the Optimal Queue Model to manage the
PES requests based on the minimum service queue length. The efficiency of the
network is improved by fine-tuning the parameters from the Queue model with the aid
of a Revised Fitness-based Political Optimizer (RF-PO). The multi-objective
constraints like queue length, utilization, actual arrival time, expected arrival
time, and end-to-end delay are utilized for the efficient supply chain system.
These stimulated results show the feasibility and effectiveness of the supply chain
framework.

Utilizing blockchain technology in enhancing supply chain efficiency and export

performance, and its implications on the financial performance of SMEs
This study examines the intricate relationships among Blockchain Technology
utilization, Supply Chain Efficiency, Export Performance, and the Financial
Performance of Small and Medium-sized Enterprises (SMEs). The research aims to
elucidate the impact of technology adoption on various operational and financial
aspects within the SME context. Employing a quantitative research design, data was
collected from a diverse sample of SMEs across industries. The relationships were
analyzed using statistical techniques, and the hypotheses were tested to uncover
the implications of Blockchain Technology integration on SMEs' performance
dimensions. The findings reveal that the adoption of Blockchain Technology
significantly enhances Supply Chain Efficiency, underscoring its potential for
optimizing operational workflows. However, the direct impact of technology on SME
Financial Performance is not established, suggesting the importance of a holistic
approach to financial growth. Moreover, the positive association between Blockchain
Technology and Export Performance highlights the pivotal role of technology in
fostering international trade success. Theoretical implications underscore the
intricate interplay between technology adoption, operational efficiencies, and
financial outcomes in SMEs. Managerially, the study advocates for SMEs to
strategically integrate technology within their supply chain management practices
to achieve enhanced efficiency and market competitiveness. Limitations include the
potential for contextual variations and measurement biases. Future research can
delve deeper into the moderating factors that influence the relationship between
technology and financial performance in SMEs. The novelty of this study lies in its
comprehensive examination of the interrelationships between these factors within
the SME context.
Impact of Blockchain Technology on Supply Chain Management Efficiency and
Transparency in Pakistan
Pre- to post-adoption of blockchain technology in supply chain management:
Influencing factors and the role of firm size
Blockchain technology (BT) provides secure, fast, and confidential distributed
systems that can solve many complex issues in supply chain management (SCM).
Drawing on the technology, organization, and environment framework, institutional
theory, and information system success model, this study proposes a pre- to post-
adoption framework for BT in SCM. Data were collected online from 272 upper-level
management of Chinese supply chain organizations. The results reveal that pre-
adoption factors, including traceability, transparency, organizational readiness,
coercive pressure, and normative pressure, positively influence BT adoption,
whereas security concerns negatively affect it. The findings further indicate the
positive impact of actual use on infusion and performance, and information
technology alignment moderates these associations in the post-adoption stage.
Interestingly, the moderating results of firm size demonstrate a significant
difference in security concerns and organizational readiness, where large
organizations have higher readiness and lower security concerns than smaller firms.

Leveraging Blockchain for Maritime Port Supply Chain Management through

Multicriteria Decision Making
This research investigates the optimal integration of Blockchain Technology (BT) in
Supply
Chain Management (SCM) within Chile’s maritime ports. Utilizing fuzzy Logarithmic
Methodology
of Additive Weights (LMAW) and Double Normalization-based Multiple Aggregation
Methods
(DNMA), the study systematically identifies, prioritizes, and ranks key factors
influencing BT adop-
tion in SCM. The study’s findings highlight crucial factors like enhanced
transaction security, good
supply chain practices, and risk management. Furthermore, it ranks the application
of ports as prime
candidates for BT integration. The research contributes theoretically by developing
a hybrid model
combining MCDA methods, and practically by guiding the strategic application of BT
in the maritime
logistics sector, aligning with the principles of Industry 5.0. This paper presents
a novel approach
that explores the utilization of BT in maritime supply chain management,
incorporating MCDA in a
vague environment. The research gap of this study lies in defining new contexts in
both theoretical
and practical literature reviews for extending the use of BT in SCM in the ports of
Chile, according to
Industry 5.0, to increase the efficiency and effectiveness of all aspects of
operations in these places.
The contribution of this research is applying hybrid MCDA methods in an uncertain
environment
to assist decision-makers (DMs) in better implementing BT in SCM in Chilean ports,
according to
Industry 5.0.

Integrating blockchain technology in supply chain management – a process model with

evidence from current implementation projects
In this paper, process models for the integration of information technologies in
supply chains are evaluated and utilized for the development of a blockchain-
specific model. Case studies are conducted to validate the model based on several
implementation projects with the purpose to refine the model’s phases and through
focus group interviews and workshops. Even though most of the studied projects
demonstrate a clear added value of their blockchain solutions, only few of them
make it to the step of running a productive system and integrate the solution in
their business processes. The outcome of this paper delivers a practice-oriented
process model for integrating blockchain solutions in supply chains. It meets all
developed requirements and is validated by interdisciplinary experts that consider
a variety of use cases and supply chain application areas.

Blockchain adoption in agri-food supply chain management: an empirical study of the

main drivers using extended UTAUT
Purpose – Blockchain technology can overcome many complicated problems related to
confidentiality, integrity and availability of fast and secure distributed systems
in the agri-food supply chain. In emerging economies like India, blockchain
application in the agri-food supply chain is still new, and their adoption is
underdeveloped. This paper aims to investigate the drivers of blockchain technology
adoption and their effect on the behavioral intention of stakeholders in adopting
blockchain technology among various stakeholders in the agri-food supply chain. The
study also develops a framework to enhance understanding of blockchain adoption in
the agri-food supply chain as well as the stakeholders’ motivation in seeking
blockchain solutions.
Design/methodology/approach – Considering the most significant aspects of
blockchain adoption in the agri-food supply chain, this study attempts to develop
an adoption model by using the extended unified theory of acceptance and technology
model with interfirm trust and transparency as additional factors. Data was
collected from a sample of 200 stakeholders in the North Indian state of Punjab.
The empirical analysis was carried out using structural equation modeling in Smart
PLS3.
Findings – The findings supported the developed framework and the results of SEM
indicate that all the paths are supported. In particular, the findings of the study
reveal that performance expectancy, effort expectancy, social influence,
facilitating conditions, interfirm trust and transparency are the drivers of
blockchain adoption and have a significant impact on the behavioral intention of
stakeholders. Cumulatively, the results positively impact the performance of agri-
food supply chain. From this study, it is found that the adoption of blockchain
technology in agri-food supply chain enhances their performance.
Originality/value – The originality of the study lies in the developed framework,
technology adoption will help them focus in the right direction by eliminating
manual methods and converting the agri-food supply chain into a digitalization
system.

The Impact of Perceived Benefits on Blockchain Adoption in Supply Chain Management

Abstract: Globalization has prompted enterprises worldwide to increasingly seek the
optimal supply
chain configuration. However, outsourcing, shortened product life cycles, and a
reduced supply
base severely weaken supply chain risk tolerance. With the emergence of blockchain,
enterprises
see an opportunity to mitigate supply chain risks. The purpose of our research is
to explore supply
chain managers’ intention to adopt blockchain technology from the perspective of
supply chain risk
management. Using a survey sample of 203 managers in China and the USA, we explored
the impact
of four perceived benefits of blockchain technology on supply chain risk resistance
by extending
the technology acceptance model. The results show that the traceability,
transparency, information
sharing, and decentralization of blockchain can enhance the perceived usefulness of
blockchain in
supply chain resilience and responsiveness, and the ability to withstand disruption
risks and supply
and demand coordination risks encountered in the supply chain, thus promoting the
adoption of the
technology. In addition, the relationships between supply chain resilience and
blockchain technology
adoption and between supply chain responsiveness and blockchain technology adoption
are more
salient for managers with high levels of uncertainty avoidance.

Exploring Blockchain Research in Supply Chain Management: A Latent Dirichlet

Allocation-Driven Systematic Review
Blockchain technology has emerged as a tool with the potential to enhance
transparency,
trust, security, and decentralization in supply chain management (SCM). This study
presents a
comprehensive review of the interplay between blockchain technology and SCM. By
analyzing an
extensive dataset of 943 articles, our exploration utilizes the Latent Dirichlet
Allocation (LDA) method
to delve deep into the thematic structure of the discourse. This investigation
revealed ten central topics
ranging from blockchain’s transformative role in supply chain finance and e-
commerce operations to
its application in specialized areas, such as the halal food supply chain and
humanitarian contexts.
Particularly pronounced were discussions on the challenges and transformations of
blockchain
integration in supply chains and its impact on pricing strategies and decision-
making. Visualization
tools, including PyLDAvis, further illuminated the interconnectedness of these
themes, highlighting
the intertwined nature of blockchain adoption challenges with aspects such as
traceability and pricing.
Despite the breadth of topics covered, the paper acknowledges its limitations due
to the fast-evolving
nature of blockchain developments during and after our analysis period. Ultimately,
this review
provides a holistic academic snapshot, emphasizing both well-developed and nascent
research areas
and guiding future research in the evolving domain of blockchain in SCM.
Privacy-Preserving Blockchain Framework for Supply Chain Management: Perceptive
Craving Game Search Optimization (PCGSO): The fierce competition in international
markets and the rapid advancements in information technology result in shorter lead
times, lower transportation capacity, and higher demand. The supply chain network
is one of the most crucial areas of concentration in the majority of business
circumstances. Blockchain technology is a promising option for safe information
exchange in the supply chain network. Although preserving security at every level
of the blockchain is somewhat important, cryptographic methodologies are frequently
used in the existing works. The novel perceptive craving game search (PCGS)
optimization algorithm is used to optimally generate the key for data sanitization,
which assures the privacy of logistics data. Here, the original logistics data
obtained from the manufacturer is sanitized with an optimal key generated by using
the PCGS optimization algorithm, avoiding the risk of unauthorized access and data
swarm that causes the system to lag. Moreover, the sanitized data obtained from the
manufacturer is transmitted to the allowed parties via different sub-chains. The
same generated key is used on the receiving customer side for reconstructing the
original information from the sanitized data. The performance and results of the
proposed blockchain-based privacy preservation model are validated using various
parameters.
Blockchain in Supply Chain Management: A Synthesis of Barriers and Enablers for
Managers: Blockchain is an emerging and disruptive technology and has the potential
to change how supply chains manage their information. However, Blockchain is
accompanied by challenges, such as increased information technology complexity,
issues of scalability, incompatibility with existing laws and regulations, and a
lack of awareness among organisations and customers. This research conducts a
bibliometric analysis based on a sample of 68 papers which address the barriers and
enablers of blockchain adoption in supply chain management. A recurring theme in
the papers was managers’ lack of understanding of Blockchain, which acted as a
barrier to adoption. This study proposes a possible explanation by arguing that the
academic models used in literature are too obscure from a manager’s perspective and
that there is a need to synthesise literature into a framework which is easily
understood and familiar. Therefore, the barriers and enablers identified in this
study were grouped into the robust Political, Economic, Social, Technological,
Legal, and Environment (PESTLE) framework. A key finding from this framework was
the absence of political barriers or enablers, which is surprising since blockchain
adoption challenges the current status quo in multiple ways. Furthermore, the
environmental enablers and barriers were scarcely discussed, with little empirical
evidence.
Resilient Reverse Logistics with Blockchain Technology in Sustainable Food Supply
Chain Management during COVID-19: COVID-19, which is a global problem affects the
all supply chains throughout the world. One of the supply chains most affected by
COVID-19 is food supply chains. Since the sustainable food supply chain processes
are complex and vulnerable in terms of product variety, it has been negatively
affected by the operational effects of COVID- 19. While the problems experienced in
the supply chain processes and raw material constraints caused stops in production,
the importance of new business models and production approaches came to the fore.
One of the issues of increasing importance is the adoption of reverse logistics
activities in sustainable food supply chains and increasing the resilience of food
supply chains by integrating blockchain technology into processes. However,
adapting blockchain technology to increase the resilience of reverse logistics
activities in the food supply chain has advantages as well as risks that need to be
considered. Therefore, it is aimed to determine these risks by using Fuzzy
Synthetic Evaluation method for eliminating the risks of blockchain adaptation for
flexible reverse logistics in food supply chains to increase resiliency. The
novelty of this study is that besides discussing about the benefits of BC-T, it is
to identify the risks it can create, to eliminate these risks and to guide the
establishment of resilience in reverse logistics activities of SFSCs. According to
results, the risks with the highest value among the sub risks is determined as data
security risks. Data Management risks is calculated as the risk with the highest
value.
The Supply Chain Has No Clothes: Technology Adoption of Blockchain for Supply Chain
Transparency: Blockchain technology, popularized by Bitcoin cryptocurrency, is
characterized as an open-source, decentralized, distributed database for storing
transaction information. Rather than relying on centralized intermediaries (e.g.,
banks) this technology allows two parties to transact directly using duplicate,
linked ledgers called blockchains. This makes transactions considerably more
transparent than those provided by centralized systems. As a result, transactions
are executed without relying on explicit trust [of a third party], but on the
distributed trust based on the consensus of the network (i.e., other blockchain
users). Applying this technology to improve supply chain transparency has many
possibilities. Every product has a long and storied history. However, much of this
history is presently obscured. Often, when negative practices are exposed, they
quickly escalate to scandalous, and financially crippling proportions. There are
many recent examples, such as the exposure of child labor upstream in the
manufacturing process and the unethical use of rainforest resources. Blockchain may
bring supply chain transparency to a new level, but presently academic and
managerial adoption of blockchain technologies is limited by our understanding. To
address this issue, this research uses the Unified Theory of Acceptance and Use of
Technology (UTAUT) and the concept of technology innovation adoption as a
foundational framework for supply chain traceability. A conceptual model is
developed and the research culminates with supply chain implications of blockchain
that are inspired by theory and literature review.
Blockchain-enabled supply chain: An experimental study: Despite Information and
Communication Technologies (ICT) have reduced the information asymmetry and
increased the degree of interorganizational collaboration, the companies
participating a supply chain are less inclined to share data when information is
sensible and partners cannot be fully trusted. In such a context, Blockchain is a
decentralized certificate authority that may provide economic and operational
benefits but companies operating in a supply chain claim to have little knowledge
about Blockchain due to its novelty and to the lack of use cases and application
studies.
In this work, a software connector has been designed and developed to connect an
Ethereum-like blockchain with the enterprises’ information systems to allow
companies to share information with their partners with different levels of
visibility and to check data authenticity, integrity and invariability over time
through the blockchain, thus building trust. In order to explore the potential of
deploying the blockchain in a supply chain, a simulation model has been developed
to recreate the supply chain operations and integrated with the blockchain through
the same software connector to carry out a scenario statistical analysis.
Application results shows how blockchain technology is a convenient instrument to
overcome collaboration and trust issues in a supply chain, to increase the supply
chain overall performance, to minimize the negative consequences of information
asymmetry over the echelons of a supply chain but also to discourage companies from
any misconduct (e.g. counterfeiting data or low data accuracy).
Blockchain and sustainable supply chain management in developing countries:
Theoretical, empirical and anecdotal evidence suggests that there are more
violations of sustainability principles in supply chains in developing countries
than in developed countries. Recent research has demonstrated that blockchain can
play an important role in promoting supply chain sustainability. In this paper we
argue that blockchain’s characteristics are especially important for enforcing
sustainability standards in developing countries. We analyze multiple case studies
of blockchain projects implemented in supply chains in developing countries to
assess product quality, environmental accounting and social impact measurement. We
have developed seven propositions, which describe how blockchain can help address a
number of challenges various stakeholders face in promoting sustainable supply
chains in developing countries. The challenges that the propositions deal with
include those associated with an unfavorable institutional environment, high costs,
technological limitations, unequal power distribution among supply chain partners
and porosity and opacity of value delivery networks.
Blockchain technology in supply chain management: an empirical study of the factors
affecting user adoption/acceptance: Blockchain overcomes numerous complicated
problems related to confidentiality, integrity, availability of fast and secure
distributed systems. Using data from a cross-sectoral survey of 449 industries, we
investigate factors that hinder or facilitate blockchain adoption in supply chains.
To capture the most vital aspects of blockchain adoption in supply chains, our
conceptual model integrates the unified theory of acceptance and use of technology
(UTAUT) model with the task-technology fit (TTF) and information system success
(ISS) models, with trust-based information technology innovation adoption
constructs. Using structural equation modelling, we find that the ISS, TTF, and
UTAUT models positively influence the key factors affecting supply chain employees’
willingness to adopt blockchain. Our results show that the UTAUT’s social influence
factor has no significant effect on the intention to adopt blockchain, while inter-
organisational trust has a significant effect on the relationship between the UTAUT
dimension and intention to adopt blockchain.
Blockchain technology in supply chain operations: Applications, challenges and
research opportunities: Blockchain is a technology with unique combination of
features such as decentralized structure, distributed notes and storage mechanism,
consensus algorithm, smart contracting, and asymmetric encryption to ensure network
security, transparency and visibility. Blockchain has immense potential to
transform supply chain (SC) functions, from SC provenance, business process
reengineering to security enhancement. More and more studies exploring the use of
blockchain in SCs have appeared in recent years. In this paper, we consider a total
of 178 articles and examine all the relevant research done in the field associated
with the use of blockchain integration in SC operations. We highlight the
corresponding opportunities, possible societal impacts, current state-of-the-art
technologies along with major trends and challenges. We examine several industrial
sectors such as shipping, manufacturing, automotive, aviation, finance, technology,
energy, healthcare, agriculture and food, e-commerce, and education among others
that can be successfully revamped with blockchain based technologies through
enhanced visibility and business process management. A future research agenda is
established which lays the solid foundation for further studies on this important
emerging research area.
Blockchain Applications in Supply Chain: Blockchain is a technological concept
which evolves from the first cryptocurrency, Bitcoin, and disrupts constantly
enlarging areas of economy. The concept of blockchain is developing, and while the
future of Bitcoin remains unclear (as it is for the most elements of the economy)
it is evident that the blockchain holds enormous potential for large-scale
improvements. However, being a technology that could decrease significance many of
today’s large global corporations, institutions and power structures which have
keen interest in preserving established hierarchies, its potential could well
remain unexploited. This paper aims to introduce and present the concept of
blockchain and its current applications in logistics and supply networks.
Blockchain technology promises overpowering trust issues and allowing trustless,
secure and authenticated system of logistics and supply chain information exchange
in supply networks. The new implementations within supply chain are shifting from
blockchain to a wider notion of distributed ledger technologies. Paper presents
description and rationale behind current and possible future applications of
blockchain in logistics and supply chain.
Analysing the impact of blockchain-technology for operations and supply chain
management: An explanatory model drawn from multiple case studies: Blockchain
technology is said to have a high disruptive potential and can do without an
intermediary. Numerous contributions deal with its impact on and possibilities for
logistics and supply chains. In this article, we use a multiple case analysis to
develop an explanatory model for the interaction of actors in an operational supply
chain involving blockchain technology. In addition, we show which intermediary
tasks the blockchain could replace and what impact this would have on the industry
logic. For this purpose, we analyze the status quo in practice based on a multiple
case study with real use cases and find answers to our research questions. The
findings of the paper include (1) insights into the impact of blockchain technology
on the logistics industry, and (2) the implications and research questions related
to blockchain technology and the impact of blockchain technology on business
models.
1 Blockchain’s roles in meeting key supply chain management objectives: Arrival of
blockchain is set to transform supply chain activities. Scholars have barely begun
to systematically assess the effects of blockchain on various organizational
activities. This paper examines how blockchain is likely to affect key supply chain
management objectives such as cost, quality, speed, dependability, risk reduction,
sustainability and flexibility. We present early evidence linking the use of
blockchain in supply chain activities to increase transparency and accountability.
Case studies of blockchain projects at various phases of development for diverse
purposes are discussed. This study illustrates the various mechanisms by which
blockchain help achieve the above supply chain objectives. Special emphasis has
been placed on the roles of the incorporation of the IoT in blockchain-based
solutions and the degree of deployment of blockchain to validate individuals’ and
assets’ identities.
The Effect of Blockchain Technology on Supply Chain Sustainability Performances:
Improving supply chain sustainability is an essential part of achieving the UN’s
sustainable goals. Digitalization, such as blockchain technology, shows the
potential to reshape supply chain management. Using distributed ledger technology,
the blockchain platform provides a digital system and database to record the
transactions along the supply chain. This decentralized database of transactions
brings transparency, reliability, traceability, and efficiency to the supply chain
management. This paper focuses on such novel blockchain-based supply chain
management and its sustainability performances in the areas of environmental
protection, social equity, and governance efficiency. Using a systematic literature
review and two case studies, we evaluate whether the three sustainability
indicators can be improved indirectly along supply chains based on blockchain
technology. Our study shows that blockchain technology has the potential to improve
supply chain sustainability performance, and we expect blockchain technology to
rise in popularity in supply chain management.
Blockchain for sustainable supply chain management: trends and ways forward:
Blockchain operates on a highly secured framework, and its decentralized consensus
has benefits for supply chain sustainability. Scholars have recognized the growing
importance of sustainability in supply chains and studied the potential of
blockchain for sustainable supply chain management. However, no study has taken
stock of high-quality research in this area. To address this gap, this paper aims
to provide a state-of-the-art overview of high-quality research on blockchain for
sustainable supply chain management. To do so, this paper conducts a systematic
literature review using a bibliometric analysis of 146 high-quality articles on
blockchain for sustainable supply chain management that have been published in
journals ranked “A*”, “A”, and “B” by the Australian Business Deans Council and
retrieved from the Scopus database. In doing so, this paper unpacks the most
prominent journals, authors, institutions, and countries that have contributed to
three major themes in the field, namely blockchain for sustainable business
activities, decision support systems using blockchain, and blockchain for
intelligent transportation system. This paper also reveals the use of blockchain
for sustainable supply chain management across four major sectors, namely food,
healthcare, manufacturing, and infrastructure, and concludes with suggestions for
future research in each sector
Supply Chain Management based on Blockchain: A Systematic Mapping Study:
Groundbreakingly, blockchain technology (BCT) has gained widespread acceptance and
importance in the last few years. Implemented in different areas of applications
such as social and legal industries, finance, smart property, and supply chain
networks. This technology assures immutability and integrity of data without the
need of a third trusted party. Furthermore, BCT could guarantee a transparent and
decentralized transaction system in businesses and industries. Even though general
research has been done in the BCT, however, there is a lack of systematic analysis
on current research challenges regarding how BCT is effectively applicable in
supply chain management (SCM). A systematic literature review (SLR) of SCM based on
blockchain does not exist yet. This work aims to explore and analyse the state-
ofthe-art on the BCT applications for SCM. We synthesize existing evidence, and
identify gaps, available in the literature. The survey uses a systematic mapping
study (SMS) method to examine 40 extracted primary studies from scientific
databases.
Implications of Blockchain Technology in Supply Chain Management: Abstract. Due to
rapid developments in technology, the supply chain becomesa bright area of interest
among up-and-coming careers in various industries.People with careers in this field
oversee such activities as product development,production, information systems,
transportation, and day-to-day logistics. But, therapidly evolving environments of
an easy and comfortable life, the demand forproduct visibility and end-to-end
traceability have grown. The existing supply chain is inefficient, unadaptable,
intractable and costly as compared to innovativeand advanced technology. Blockchain
is the emerging and revolutionarytechnology that impacts the supply chain networks
significantly. Therefore, in thispaper, the implication of blockchain technology in
the supply chain is presented.
Application of Blockchain to Supply Chain: Flexible Blockchain Technology: It has
been ten years since Satoshi Nakamoto created bitcoin and introduced the concept of
a blockchain. The original goal was to propose a solution to the double-spending
problem using a peer-to-peer network. Now, Blockchain proves to have the capacity
to deliver a new kind of trust to a wide range of services. Applications are being
explored in healthcare (patient records), government (land registries) and
electronics (Internet of Things). The supply chain is one of the fields that
Blockchain is expected to be applied. The paper aims to combine blockchain with
distributed storage and propose blockchain for the supply chain. Blockchain is not
fit to record a lot of information. It requires both on-chain storage of the core
ledger data and off-chain storage of data required by smart contracts for
verification and documentation. The Inter Planetary File System (IPFS) is a
concrete solution. IPFS is a peer-to-peer distributed file system that seeks to
connect all computing devices with the same system of files. Participants can
address large amounts of data with IPFS and place the immutable, permanent IPFS
links into a blockchain transaction. This timestamps and secures their content,
without having to put the data itself on the chain. By combining blockchain with
distributed storage, the supply chain system is fit to the industry of the next
generation. The characteristics of Industry 4.0 meets the blockchain-based system
and the model can aid these changes.
Blockchain-based traceability in Agri-Food supply chain management: A practical
implementation: The recent, exponential rise in adoption of the most disparate
Internet of Things (IoT) devices and technologies has reached also Agriculture and
Food (Agri-Food) supply chains, drumming up substantial research and innovation
interest towards developing reliable, auditable and transparent traceability
systems. Current IoT-based traceability and provenance systems for Agri-Food supply
chains are built on top of centralized infrastructures and this leaves room for
unsolved issues and major concerns, including data integrity, tampering and single
points of failure. Blockchains, the distributed ledger technology underpinning
cryptocurrencies such as Bitcoin, represent a new and innovative technological
approach to realizing decentralized trustless systems. Indeed, the inherent
properties of this digital technology provide fault-tolerance, immutability,
transparency and full traceability of the stored transaction records, as well as
coherent digital representations of physical assets and autonomous transaction
executions. This paper presents AgriBlockIoT, a fully decentralized, blockchain-
based traceability solution for Agri-Food supply chain management, able to seamless
integrate IoT devices producing and consuming digital data along the chain. To
effectively assess AgriBlockIoT, first, we defined a classical use-case within the
given vertical domain, namely from-farm-to-fork. Then, we developed and deployed
such use-case, achieving traceability using two different blockchain
implementations, namely Ethereum and Hyperledger Sawtooth. Finally, we evaluated
and compared the performance of both the deployments, in terms of latency, CPU, and
network usage, also highlighting their main pros and cons.
A Blockchain-Based Supply Chain Quality Management Framework: Recent quality
scandals reveal the importance of quality management from a supply chain
perspective. Although there has been many related studies focusing on supply chain
quality management, the technologies used still have difficulties in resolving
problems arising from the lack of trust in supply chains. The root reason lies in
three challenges brought to the traditional centralized trust mechanism: self-
interests of supply chain members, information asymmetry in production processes,
costs and limitations of quality inspections. Blockchain is a promising technology
to address these problems. In this paper, we discuss how to improve the supply
chain quality management by adopting the blockchain technology, and propose a
framework for blockchain-based supply chain quality management.
The impact of the blockchain on the supply chain: a theory-based research framework
and a call for action: Purpose – This paper aims to strive to close the current
research gap pertaining to potential implications of the blockchain for supply
chain management (SCM) by presenting a framework built on four established economic
theories, namely, principal agent theory (PAT), transaction cost analysis (TCA),
resource-based view (RBV) and network theory (NT). These theories can be used to
derive research questions that are theory-based
as well as relevant for the industry. This paper is intended to initiate and
stimulate an academic discussion on the potential impact of the blockchainand
introduces a framework for middle-range theorizing together with several research
questions.
Blockchain adoption in operations and supply chain management: empirical evidence
from an emerging economy: The adoption of technologies by the operations and supply
chain management (OSCM) field is leading to extraordinary disruptions. And with the
rapid emergence of cutting-edge and more disruptive technologies, the OSCM is
striving to take advantage of such innovations, but they are bringing in their wake
a number of challenges. One of those disruptive technologies is blockchain, which
is increasingly accepted in virtually all industries. This study aims to
investigate the blockchain technology (BCT) adoption behaviour and possible
barriers in the Brazilian OSCM context. We developed a model drawing on the unified
theory of acceptance and use of technology (UTAUT) model, the supply chain
literature, and the emerging literature on BCT. We empirically validated the
proposed model with Brazilian operations and supply chain professionals by using
the partial least squares structural equation modelling (PLS-SEM). Our findings
revealed that facilitating conditions, trust, social influence, and effort
expectancy are the most critical constructs that directly affect BCT adoption.
Unexpectedly, performance expectancy appeared not decisive in terms of predicting
BCT adoption. This study contributes to advancing and stimulating the theory about
BCT adoption behaviour in supply chains, as well as important managerial
implications, which may be more critical for emerging economies.
How the blockchain enables and constrains supply chain performance: The purpose of
this paper is to understand the enabling and constraining roles of blockchain
technology (BCT) in managerial work practices and conceptualise the technology–
performance relationship in supply chain management (SCM).
Potentials of Blockchain Technologies in Supply Chain Management - A Conceptual
Model: Meanwhile the rapidly advancing digitisation affects almost all areas of
society and business. This development is based in particular on the omni-present
use of digital information technology. One of these technologies awarded with
special potential related to business is the distributed ledger technology. The
objective of this study is to investigate influences on the potentials of
blockchain technology, being one distributed ledger technology, in the area of
supply chain management. An empirical, qualitative data collection attained through
expert interviews forms the data basis. The conceptual model is derived by using
Grounded Theory Methodology to evaluate the interviews. Important influencing
factors (trust, efficiency, costs, control, privacy, scalability) for the potential
of blockchain technology in supply chain management and moderating effects (use
case, knowledge, collaboration, regulations) form the conceptual model in order to
deduce recommendations for business.
Blockchain Technology for Sustainable Supply Chain Management: A Systematic
Literature Review and a Classification Framework: Through a systematic review of
publications in reputed peer-reviewed journals, this paper investigates the role of
blockchain technology in sustainable supply chain management. It uses the What,
Who, Where, When, How, and Why (5W+1H) pattern to formulate research objectives and
questions. The review considers publications since 2015, and it includes 187 papers
published in 2017, 2018, 2019, and the early part of 2020, since no significant
publications were found in the year 2015 or 2016 on this subject. It proposes a
reusable classification framework—emerging technology literature classification
level (ETLCL) framework—based on grounded theory and the technology readiness level
for conducting literature reviews in various focus areas of an emerging technology.
Subsequently, the study uses ETLCL to classify the literature on our focus area.
The results show traceability and transparency as the key benefits of applying
blockchain technology. They also indicate a heightened interest in blockchain-based
information systems for sustainable supply chain management starting since 2017.
This paper offers invaluable insights for managers and leaders who envision
sustainability as an essential component of their business. The findings
demonstrate the disruptive power and role of blockchain-based information systems.
Given the relative novelty of the topic and its scattered literature, the paper
helps practitioners examining its various aspects by directing them to the right
information sources.
Understanding blockchain technology for future supply chains: a systematic
literature review and research agenda: This paper aims to investigate the way in
which blockchain technology is likely to influence future supply chain practices
and policies.
Applications of Blockchain Technology in Sustainable Manufacturing and Supply Chain
Management: A Systematic Review: Developing sustainable products and processes is
essential for the survival of manufacturers in the current competitive market and
the industry 4.0 era. The activities of manufacturers and their supply chain
partners should be aligned with sustainable development goals. Manufacturers have
faced many barriers and challenges in implementing sustainable practices along the
entire supply chain due to globalisation, outsourcing, and offshoring. Blockchain
technology has the potential to address the challenges of sustainability. This
study aims to explain the applications of blockchain technology to sustainable
manufacturing. We conducted a systematic literature review and explained the
potential contributions of blockchain technology to the economic, environmental,
and social performances of manufacturers and their supply chains. The findings of
the study extend our understanding of the blockchain applications in sustainable
manufacturing and sustainable supply chains. Furthermore, the study explains how
blockchain can influence the sustainable performance of manufacturers by creating
transparency, traceability, real-time information sharing, and security of the data
capabilities.
Blockchain Design for Supply Chain Management: Blockchain related research is still
in its infancy, and is mostly focused on security and scalability. Very little of
this research examines at its impact and design issues from management
perspectives, especially from the perspective of Supply Chain Management (SCM). To
investigate the impact of blockchain technology (BCT) on SCM and the inherent
design issues, we consider a generic stochastic model, where a firm seeks to
maximize the total expected discounted profit, by jointly managing (i) blockchain
design, (ii) production and ordering decisions, and (iii) dynamic pricing and
selling. We first show that the deployment of BCT can assist firms in reducing
order quantities, lowering selling prices and reducing target-inventory levels. It
is also shown that volatility of either supply or demand lowers the expected
profit. The analysis is robust with some major extensions, such as lost-sales of
demand and random capacity. Finally, our numerical study accumulates useful
managerial insights. For example, subject to tech-savvy customer behavior, some
types of goods (e.g., credence goods and experience goods) greatly benefit from the
adoption of BCT, but it may not prove beneficial to leverage BCT for certain others
(e.g., search goods). Considering the lifecycle of a typical good, it is
recommended to adopt BCT as early as possible and to adopt it to a higher degree at
an earlier stage.
Blockchains for Supply Chain Management: Architectural Elements and Challenges
Towards a Global Scale Deployment: Blockchains are attracting the attention of
stakeholders in many industrial domains, including the logistics and supply chain
industries. Blockchain technology can effectively contribute in recording every
single asset throughout its flow on the supply chain, contribute in tracking
orders, receipts, and payments, while track digital assets such as warranties and
licenses in a unified and transparent way. The paper provides, through its
methodology, a detailed analysis of the blockchain fit in the supply chain
industry. It defines the specific elements of blockchain that affect supply chain
such as scalability, performance, consensus mechanism, privacy considerations,
location proof and cost, and details on the impact that blockchains will have in
disrupting the supply chain industry. Discussing the tradeoff between consensus
cost, throughput and validation time it proceeds with a suggested high-level
architectural approach, and concludes as a result with a discussion on changes
needed and challenges faced for an in-vivo deployment of blockchains in the supply
chain industry. While the technological features of modern blockchains can
effectively facilitate supply chain uses cases, the various challenges that still
remain, bring in front of us a wide set of needed changes and further research
efforts for achieving a global, production level blockchain for the supply chain
industry.
Blockchain technology for enhancing supply chain resilience: With the soaring value
of bitcoin and frenzy over cryptocurrency, the blockchain technology that sparked
the bitcoin revolution has received heightened attention from both practitioners
and academics. Blockchain technology often causes controversies surrounding its
application potential and business ramifications. The blockchain is a peer-to-peer
network of information technology that keeps records of digital asset transactions
using distributed ledgers that are free from control by intermediaries such as
banks and governments. Thus, it can mitigate risks associated with intermediaries’
interventions, including hacking, compromised privacy, vulnerability to political
turmoil, costly compliance with government rules and regulation, instability of
financial institutions, and contractual disputes. This article unlocks the mystique
of blockchain technology and discusses ways to leverage blockchain technology to
enhance supply chain resilience in times of increased risks and uncertainty.
A Framework for Blockchain Technology in Rice Supply Chain Management: As rice is a
basic grain of food consumption in India, its integrityduring supply chain
processes is always a major concern for the society. With the rapid growth in the
internet, a lot emerging technologies have been appliedin the rice supply chain
system. However, all these systems being centralized creates trust problems like
fraud, tampering and falsifying information. Theblockchain technology which is
decentralized not governed by any centralauthority and distributed is the solution
for the problems arising in the ricesupply chain system. In this paper, we will
build a rice supply chain systemusing blockchain technology which will assure
safety of rice during supplychain management processes.
Architecture to Enhance Transparency in Supply Chain Management using Blockchain
Technology: Precise information flow in a supply chain (SC) improves profitability.
Distorted information in SC results in coordination and transaction issues that
diminish trust between SC partners. The prime objective of the present study is to
enhance transparency in SC for both suppliers and consumers and boost legitimate
coordination within the SC network using Blockchain Technology (BT). BT is a tool
having an open-source, decentralized, and distributed database for storing
transaction information. It allows two parties to perform direct transactions using
their distributed ledgers without the interference of a centralized third party to
achieving more transparent transactions than traditional systems. Consequently, the
architecture of BT in SC has been developed based on factors identified from the
literature review that leads to offering tracking and monitoring of entire SC.
Subsequently, the blockchain architecture has been tested considering transactions
between manufacturer, distributor, retailer, and customer to accomplish real-time
transparency. Accordingly, it has been observed that transaction errors have been
minimized, transparency has been improved in SC of the manufacturing industry using
BT. Moreover, this paper provides a productive relationship between BT and SC
management.
Examples from Blockchain Implementations in Logistics and Supply Chain Management:
Exploring the Mindful Use of a New Technology: In the context of logistics,
blockchain can help to increase end-to-end visibility along global supply chains.
Thus, it can lead to improved tracking of goods and offer tamper-proof data to
build trust among parties. Although a variety of blockchain use cases already
exists, not all of them seem to rely on blockchain-specific features, but could
rather be solved with traditional technologies. The purpose of this paper is,
therefore, to identify characteristic use cases described for blockchain in the
field of LSCM and to analyze them regarding their mindful technology use based on
five mindful technology adoption principles: engagement with the technology;
Technological novelty seeking; awareness of local context; cognizance of
alternative technologies; and anticipation of technology alteration. The authors
identified five blockchain case clusters and chose one case for each category to be
analyzed in detail. Most cases demonstrate high engagement with the technology, but
there are significant differences when it comes to the other mindful use
principles. This paper highlights the need to understand the problem and to apply
the right technology in order to solve it. When solving a problem, care should be
taken to address a technology’s unique features to ensure effectiveness and cost-
efficiency.
Blockchain Framework for Textile Supply Chain Management Improving Transparency,
Traceability, and Quality: Modern textile supply chain systems are both large and
complicated, with global sources and suppliers feeding into production lines that
can span continents. A substantial amount of defects can’t be directly traced back
to defective batches that entered the supply chain along the way, causing waste and
frustration downstream. Traceability is almost impossible due to the number of
stages the product goes through and the size of data involved. No single system is
globally utilized to record and trace the product throughout the supply chain. By
the time the root cause of the issue is discovered, no recourse is possible except
to discard the end product, resulting in losses that could reach 40% of the end
product value. Communicating quality issues cross-stream is virtually nonexistent
due to the challenges in identifying the source and recognizing that the other
systems can deal with utilizing it. While traceability is an obvious problem in
textile supply chain, transparency is a more impactful issue that is not well
addressed. Cross supply chain and lack of transparency exacerbates the problems
facing each participant and forces each entity to work locally using the localized
information. This approach is fundamentally flawed as it deals with a global
problem from a localized point of view. Not all industries are ripe for taking
advantage of blockchain technology. Blockchain requires an industry with a
complicated and widely distributed supply chain, containing an increased number of
middle stages. This cannot apply more than in one of the world’s oldest industries,
textile. In this paper, we propose a complete blockchain-based framework for
textile quality improvement that enables in near real time, cross chain information
sharing with guaranteed authenticity and accuracy allowing quality defective
batches to be identified in all systems as soon as they are detected in any few.
Insights into Blockchain Implementation in Construction: Models for Supply Chain
Management: The interest in the implementation of distributed ledger technologies
(DLTs) is on the rise in the construction sector. One specific type of DLT that
hasrecently attracted much attention is blockchain. Blockchain has been mostly
discussed conceptually for construction to date. This study presents some empirical
discussions on supply chain management (SCM) applications of blockchain for
construction by collecting feedback for three blockchain-based models for Project
Bank Accounts (PBAs) for payments, Reverse Auction-based Tendering for bidding and
Asset Tokenization for project financing. The feedback was collected from three
focus groups and a workshop. The working prototypes for the models were developed
on Ethereum. The implementation of blockchain in payment arrangements was found
simpler than in tendering and project tokenization workflows. However, the
blockchain integration of those workflows may have large-scale impacts on the
sector in the future. A broad set of general and model specific
benefits/opportunities and requirements/challenges was also identified for
blockchain in construction. Some of these include streamlined, transparent
transactions and rational trust-building, and the need for challenging the sector
culture, upscaling the legacy IT systems and compliance with the regulatory
structures.
An exploration of blockchain technology in supply chain management: Day by day new
technologies are applied to the business environment. Since the start of the fourth
industrial revolution, the digital tools allow productivity improvement. Different
kinds of technologies have been used to support companies in tasks of sending and
receiving information. The information exchanged between companies has always being
a concern when having in mind trust, speed, and safety. During few decades, EDI
(electronic data exchange) was the main technology supply chain professionals used
to send and receive information. Recently, with the rise of the fourth industrial
revolution and the Internet of Things (IoT), many aspects of the business
environment have changed. Individuals and organizations are required to be more
productive. One of the mainstreams for the business environment is blockchain. Some
researches argued that bitcoin is the pioneer of blockchain technology. Financial
companies joined forces to build a technological infrastructure to use the
cryptocurrency on the market. The first blockchain conceived in 2008, in the wake
of the global financial crisis and it has never been hacked. Supply chains are
complex networks of distant, separate entities that exchange goods, payments, and
data across a dynamic, continuously evolving landscape. Blockchain technology
allows visibility providing the customer the opportunity to understand how the
supply chain works and how to get more information about products traceability.
However, there are some challenges to implement blockchain in logistic and supply
chain. The paper presents a theoretical review including the principles of the
blockchain operations and the required infrastructure to implement it. The paper
does not cover the technology architecture applied to the blockchain. The potential
benefit of the blockchain will be covered to understand how to apply it in
logistics and in the supply chain environment, presenting some examples already
implemented or identified.
Blockchain in logistics and supply chain: Trick or treat? Blockchain is an emergent
technology concept that enables the decentralized and immutable storage of verified
data. Over the last few years, it has increasingly attracted the attention of
different industries. Especially in Fintech, Blockchain in hyped as the silver
bullet that might overthrow today’s payment handling. Slowly, the logistics and
supply chain management community realizes how profoundly Blockchain could affect
their industry. To shed light on this emerging field, we conducted an online survey
and asked logistics professionals for their opinion on use case exemplars,
barriers, facilitators, and the general prospects of Blockchain in logistics and
supply chain management. We found most of our participants are fairly positive
about this new technology and the benefits it offers. However, factors like the
hierarchical level, Blockchain experiences, and the industry sector have a
significant impact on the participants’ evaluation. We reason that the benefits
over existing IT solutions must be carved out more carefully and use cases must be
further explored to get a rather conservative industry, like logistics, more
excited about Blockchain.
Blockchain’s Roles in Meeting Key Supply Chain Management Objectives: Arrival of
blockchain is set to transform supply chain activities. Scholars have barely begun
to systematically assess the effects of blockchain on various organizational
activities. This paper examines how blockchain is likely to affect key supply chain
management objectives such as cost, quality, speed, dependability, risk reduction,
sustainability and flexibility. We present early evidence linking the use of
blockchain in supply chain activities to increase transparency and accountability.
Case studies of blockchain projects at various phases of development for diverse
purposes are discussed. This study illustrates the various mechanisms by which
blockchain help achieve the above supply chain objectives. Special emphasis has
been placed on the roles of the incorporation of the IoT in blockchain-based
solutions and the degree of deployment of blockchain to validate individuals’ and
assets’ identities.
Blockchain-based traceability in Agri-Food supply chain management: A practical
implementation: Abstract—The recent, exponential rise in adoption of the most
disparate Internet of Things (IoT) devices and technologies has reached also
Agriculture and Food (Agri-Food) supply chains, drumming up substantial research
and innovation interest to-wards developing reliable, auditable and transparent
traceability systems. Current IoT-based traceability and provenance systems for
Agri-Food supply chains are built on top of centralized infrastructures and this
leaves room for unsolved issues and major concerns, including data integrity,
tampering and single points of failure. Blockchains, the distributed ledger
technology underpinning cryptocurrencies such as Bitcoin, represent a new and
innovative technological approach to realizing decentralized trustless systems.
Indeed, the inherent properties of this digital technology provide fault-tolerance,
immutability, trans- parency and full traceability of the stored transaction
records as well as coherent digital representations of physical assets and
autonomous transaction executions. This paper presents AgriBlockIoT, a fully
decentralized, blockchain-based traceability solution for Agri-Food supply chain
management, able to seamless integrate IoT devices producing and consuming digital
data along the chain. To effectively assess AgriBlockIoT, first, we defined a
classical use-case within the given vertical domain, namely from-farm-to-fork.
Then, we developed and deployed such use-case, achieving traceability using two
different blockchain implementations, namely Ethereum and Hyperledger
Sawtooth.Finally, we evaluated and compared the performance of both the
deployments, in terms of latency, CPU, and network usage, also highlighting their
main pros and cons.
Digital Supply Chain Transformation toward Blockchain Integration: Digital supply
chain integration is becoming increasingly dynamic. Access to customer demand needs
to be shared effectively, and product and service deliveries must be tracked to
provide visibility in the supply chain. Business process integration is based on
standards and reference architectures, which should offer end-to-end integration of
product data. Companies operating in supply chains establish process and data
integration through the specialized intermediate companies, whose role is to
establish interoperability by mapping and integrating company- specific data for
various organizations and systems. This has typically caused high integration
costs, and diffusion is slow. This paper investigates the requirements and
functionalities of supply chain integration. Cloud integration can be expected to
offer a cost-effective business model for interoperable digital supply chains. We
explain how supply chain integration through the blockchain technology can achieve
disruptive transformation in digital supply chains and networks.
"The impact of the blockchain on the supply chain: a theory-based research
framework and a call for action: Purpose – This paper aims to strive to close the
current research gap pertaining to potential implications of the blockchain for
supply chain management (SCM) by presenting a framework built on four established
economic theories, namely, principal agent theory (PAT), transaction cost analysis
(TCA), resource-based view (RBV) and network theory (NT). These theories can be
used to derive research questions that are theory-based as well as relevant for the
industry. This paper is intended to initiate and stimulate an academic discussion
on the potential impact of the blockchain and introduces a framework for middle-
range theorizing together with several research questions.
Design/methodology/approach – This paper builds on previous theories that are
frequently used in SCM research and shows how they can be adapted to blockchain-
related questions.
Findings – This paper introduces a framework for middle-range theorizing together
with several research questions.
Research limitations/implications – The paper presents blockchain-related research
questions derived from four frequently used theories, namely, PAT, TCA, RBV and
(NT). These questions will guide future research pertaining to structural (PAT,
TCA) and managerial issues (RBV, NT) and will foster middle-range theory
development in SCM research. Practical implications – Blockchain technology has the
potential to significantly change SCM. Given the huge investments by industry,
academic research is needed which investigates potential implications and supports
companies. In this paper, various research questions are introduced that illustrate
how the implications of blockchain on SCM can be investigated from different
perspectives. Originality/value – To the best of the author’s knowledge, no
academic papers are published in leading academic journals that investigate the
relationship between SCM and blockchain from a theory-based perspective."
The Blockchain Application in Supply Chain Management: Opportunities, Challenges
and Outlook: Abstract—Blockchain is a game changer in nowadays information
technology and financial industry. Since Nakamoto invented the concept of
blockchain together with its first application called “Bitcoin”, the topic of
blockchain has been inundated with the booming of cryptocurrencies. People expect
this novel distributed ledger technology to bring a revolution to the entire
industry and thereby grab the opportunity to expand and strengthen their business.
The supply chain is treated as a typical use case to adopt blockchain and relevant
technologies in many previous studies. In this paper, we conduct an
interdisciplinary study on business supply chain management and the latest
distributed ledger technology. In accordance with our discussion and experiments,
we list three major benefits that the adoption of blockchain is able to bring to
contemporary supply chain management. Meanwhile, we also identify a few of
challenges that the nowadays blockchain application could not effectively excel,
and the potential mitigation to those challenges as well. Index Terms—blockchain,
business intelligence, distributed ledger, logistics, supply chain management
Blockchain for sustainable supply chain management: trends and ways forward:
Blockchain operates on a highly secured framework, and its decentralized consensus
has benefts for supply chain sustainability. Scholars have recognized the growing
importance of sustainability in supply chains and studied the potential of
blockchain for sustainable supply chain management. However, no study has taken
stock of high-quality research in this area. To address this gap, this paper aims
to provide a state-of-the-art overview of high-quality research on blockchain for
sustainable supply chain management. To do so, this paper conducts a systematic
literature review using a bibliometric analysis of 146 high-quality articles on
blockchain for sustainable supply chain management that have been published in
journals ranked “A*”,“A”, and “B” by the Australian Business Deans Council and
retrieved from the Scopus database. In doing so, this paper unpacks the most
prominent journals, authors, institutions, and countries that have contributed to
three major themes in the feld, namely blockchain for sustainable business
activities, decision support systems using blockchain, and blockchain for
intelligent transportation system. This paper also reveals the use of blockchain
for sustainable supply chain management across four major sectors, namely food,
healthcare, manufacturing, and infrastructure, and concludes with suggestions for
future research in each sector.
Information Sharing for Supply Chain Management based on Block Chain Technology:
Supply Chain Management systems provide information sharing and analysis to
companies and support their planning activities. They are not based on the real
data because there is asymmetric information between companies, then leading to
disturbance of the planning algorithms. On the other hand, sharing data between
manufacturers, suppliers and customers becomes very important to ensure reactivity
towards markets variability. Especially, double marginalization is a widespread and
serious problem in supply chain management. Decentralized systems under wholesale
price contracts are investigated, with double marginalization effects shown to lead
to supply insufficiencies, in the cases of both deterministic and random demands.
This paper proposes a blockchain based solution to address the problems of supply
chain such as Double Marginalization and Information Asymmetry etc.
Requirements for Blockchain Technology in Supply Chain Management: An Exploratory
Case Study: The aim of this research study is to look for possible research
opportunities to applying blockchain technology in supply chain management and
logistics. In addition, accompanying challenges to utilizing blockchain in supply
chain management along with possible solutions are also provided. To fulfil the
study objective, both theoretical and empirical approaches are adopted for this
study. With respect to theoretical approach, relevant literature on blockchain was
reviewed considering both technical and economic aspects, its architecture and
implementation challenges. The empirical part of the research was conducted by
studying three case companies operating in the domains of wood construction,
consulting and regional development, and technology. Three case companies were
analysed with respect to the application of blockchain in their supply chain
operations. From the study outcomes, it was noticed that blockchain technology can
be utilized successfully in supply chain management in various business domains in
order to provide, for instance, better services and transparency.
A Blockchain-based Supply Chain Quality Management Framework: Abstract—Recent
quality scandals reveal the importance of quality management from a supply chain
perspective. Although there has been many related studies focusing on supply chain
quality management, the technologies used still have difficulties in resolving
problems arising from the lack of trust in supply chains. The root reason lies in
three challenges brought to the traditional centralized trust mechanism: self-
interests of supply chain members, information asymmetry in production processes,
costs and limitations of quality inspections. Blockchain is a promising technology
to address these problems. In this paper, we discuss how to improve the supply
chain quality management by adopting the blockchain technology, and propose a
framework for blockchain-based supply chain quality management.
Blockchain Technology: Supply Chain Insights from ERP: The chapter provides a high
level understanding of how ERP system alongside Blockchain technology will be a
powerful tool to improve supply chain operations. The chapter details out how the
two technologies will complement each other in every aspect of supply chain
functions bringing in transparency, efficiency, and cost reduction. The chapter
considers every aspects of supply chain for an ERP enabled organizations and
details out use cases for master data, engineering design, sales process,
procurement process, demand and supply planning process, manufacturing process, and
logistics management processes. The chapter provides use case details and high
level understanding of technology for product provenance and how it can bring in
supply chain transparency using blockchain. The chapter illustrates theoretical and
conceptual model for use of open and permissioned blockchain in different supply
chain applica- tions with real life practical use cases as is being developed and
deployed in various industries and business functions. The chapter also emphasizes
the use of blockchain in distribution industry and how it can solve pertinent
problems as it exists today in the distribution supply chain. The chapter ends with
an outlook of blockchain how it will shape the future to come and challenges which
lies there within.
Blockchain Technology for Efficient Management of Supply Chain: Increasing global
demands in the supply chain in this fast-paced world entails more transparent and
efficient supply chain management, which can be encountered with the use of
blockchain technology combined with the Internet of Things (IoT). This study
explains the effects of blockchain technology combined with IoT in terms of
transparency, risk reduction, flexibility, speed from the customer’s demand to the
customer’s deliverable. Supply chain objectives are achieved using various
mechanisms of blockchain technology by which the customer can track the real nature
of the products getting delivered to them, which surges the value and trust of the
organization. The blockchain is a decentralized, digitized, public ledger of all
cryptocurrency transactions. By implementing blockchain, the traceability and
capacity to share information about production processes will be made easier and
trustworthy. Traceability takes center stage in organizations supply chain;
furthermore, it is a tool in fighting product counterfeiting and protecting brands.
Implementing blockchain can revolutionize the way a supply chain works. This paper
examines the case-studies on early implementation of block technology with IoT with
special importance on the degree of deployment of blockchain technology for
validation, transparency, and traceability purpose at various industries; such as
e-commerce, food, and warehousing.
Traceability Decentralization in Supply Chain Management Using Blockchain
Technologies: With the increase of web users and applications with real time
requests, the ability to identify, track and trace elements of a product as it
moves in the supply chain is deemed necessary, and for many industries is even
mandated by national or international regulations. Traceability presupposes the
integrity and transparency of data that is saved and shared. This is a problem for
current technologies, as there are many examples with tampered data and database
vulnerabilities that resulted in serious implications and data loss. A solution to
this problem can be the decentralization of the system, which will remove the
central point of failure. To that effect, blockchain or DLT technologies, an
emergent technology that enables the decentralization of a network can be used, by
implementing a trustless model to achieve it. Blockchains are tamperproof and
transparent, which means that by exploiting blockchain characteristics,
traceability can be improved. A model that describes the decentralization process
of the supply chain traceability part has been developed for this paper and is
later evaluated and compared with the traditional system.
Adoption of Blockchain Technology in Supply Chain and Logistics: This thesis was
focused on analyzing the innovative technology “Blockchain” and the potential of
blockchain-based applications. The main objectives were to define how blockchain
can change the supply chain and logistics industry. The typical challenges in these
spheres were considered and the main key features of blockchain that can solve
these difficulties were marked. After that the Head of IoT Business Development in
Kouvola Innovation Ltd. was interviewed to find out possible challenges or benefits
of blockchain- based applications. Considering the current situation in the supply
chain and logistics industry, this thesis can empower different businesses to start
working with the companies that are creating blockchain-based applications.
The outlook of blockchain technology for construction engineering management:
Current construction engineering management suffers numerous challenges in terms of
the trust, information sharing, and process automation. Blockchain which is a
decentralised transaction and data management technology, has attracted increasing
interests from both academic and industrial aspects since 2008. However, most of
the existing research and practices are focused on the blockchain itself (i.e.
technical challenges and limitations) or its applications in the finance service
sector (i.e. Bitcoin). This paper aims to investigate the potential of applying
blockchain technology in the construction sector. Three types of blockchain-enabled
applications are proposed to improve the current processes of contract management,
supply chain management, and equipment leasing, respectively. Challenges of
blockchain implementation are also discussed in this paper.
Recent technologies, mainly associated with Industry 4.0, are provoking significant
disruptions and forcing the supply chain management (SCM) field to develop new
business strategy models. One of the most promising of these technologies is
blockchains. Blockchain technology first appeared in the bitcoin context (Nakamoto,
2008). It works in a distributed data structure based on a peer-to-peer network
transaction (Christidis and Devetsikiotis, 2016; Marsal-Llacuna, 2018). Blocks are
linked by cryptographic hashes (de Leon et al., 2017) and all their nodes have a
copy (Al-Saqaf and Seidler, 2017; Scott et al., 2017). Because of these features,
the transactions records are considered virtually immutable (Adams et al., 2017a;
Cai and Zhu, 2016; Grewalet al., 2018). Although blockchain technology applications
emerged with bitcoins (Nakamoto, 2008), the current applications have the potential
to disrupt different, traditional industries (Scott et al., 2017; White, 2017).
Based on the decentralisation principle, in which intermediaries can be eliminated,
the smart contract is an essential blockchain application that works in an
automated manner to transfer assets when a determined condition is satisfied (Al-
Saqaf and Seidler, 2017). Thus, smart contracts are reconfiguring several business
models, in which producer and consumer can trade without an intermediary.
Consequently, blockchain decentralisation and disintermediation features (Scott et
al., 2017) can lead to disruption and support SCM innovation and reconfiguration in
the digital age. Despite these significant blockchain applications and their The
current issue and full text archive of this journal is available on potential to
promote changes in all types of supply chains in terms of new operation models, the
literature about blockchain technology in the SCM field is in its infancy.
Literature examining the application of blockchains in SCM, and the impact of
subsequent disruptions, is scarce. To shed some light on this hot topic, a
systematic literature review (SLR) (Denyer and Tranfield, 2009; Tranfield et al.,
2003) was used to answer the following research questions: RQ1. What are the main
current blockchain applications in SCM? RQ2. What are the main disruptions and
challenges in SCM because of blockchain adoption? RQ3. What is the future of
blockchains in SCM? Thus, this research aims to shed light on blockchain–SCM
integration, making a significant contribution to the literature and also having
implications for practitioners and decision makers interested in gaining an in-
depth understanding of this cutting-edge technology. Additionally, blockchain
technology is a multidisciplinary field, and this study intends to show the current
journals that are in the vanguard regarding this hot topic. This study brings
relevant insights to scholars and practitioners interested in advancing blockchain–
SCM integration. It is a first investigation that analyses the blockchain–SCM
integration literature from 2008 to 2018 (February). Also, the SLR revealed
important gaps in the literature, highlighting managerial implications and
providing a robust research agenda. The rest of this paper is organised as follows.
In Section 2, we introduce the basic concepts of SCM and blockchains. In Section 3,
we justify and present the main aspects of the systematic-review methodology based
on Tranfield et al. (2003) and Denyer and Tranfield (2009). Section 4 provides the
main research findings, and Section 5 provides a discussion addressing the three
RQs. In Section 6, the managerial implications based on the findings are
highlighted. Section 7 details the research implications and proposes an agenda for
future research. Section 8 presents the main contributions from the perspectives of
methodology, scope, and insights. Finally, in Section 9, final remarks and
limitations are presented.
Recent technologies, mainly associated with Industry 4.0, are provoking significant
disruptions and forcing the supply chain management (SCM) field to develop new
business strategy models. One of the most promising of these technologies is
blockchains. Blockchain technology first appeared in the bitcoin context (Nakamoto,
2008). It works in a distributed data structure based on a peer-to-peer network
transaction (Christidis and Devetsikiotis, 2016; Marsal-Llacuna, 2018). Blocks are
linked by cryptographic hashes (de Leon et al., 2017) and all their nodes have a
copy (Al-Saqaf and Seidler, 2017; Scott et al., 2017). Because of these features,
the transactions records are considered virtually immutable (Adams et al., 2017a;
Cai and Zhu, 2016; Grewalet al., 2018). Although blockchain technology applications
emerged with bitcoins (Nakamoto, 2008), the current applications have the potential
to disrupt different, traditional industries (Scott et al., 2017; White, 2017).
Based on the decentralisation principle, in which intermediaries can be eliminated,
the smart contract is an essential blockchain application that works in an
automated manner to transfer assets when a determined condition is satisfied (Al-
Saqaf and Seidler, 2017). Thus, smart contracts are reconfiguring several business
models, in which producer and consumer can trade without an intermediary.
Consequently, blockchain decentralisation and disintermediation features (Scott et
al., 2017) can lead to disruption and support SCM innovation and reconfiguration in
the digital age. Despite these significant blockchain applications and their The
current issue and full text archive of this journal is available on potential to
promote changes in all types of supply chains in Emerald Insight at:
www.emeraldinsight.com/1359-8546.htm Supply Chain Management: An International
Journal © Emerald Publishing Limited [ISSN 1359-8546] [DOI 10.1108/SCM-03-2018-
0143] Received 31 March 2018 Revised 23 August 2018 3 December 2018 Accepted 6
December 2018 Downloaded by Macquarie University At 01:20 13 February 2019 (PT)
terms of new operation models, the literature about blockchain technology in the
SCM field is in its infancy. Literature examining the application of blockchains in
SCM, and the impact of subsequent disruptions, is scarce. To shed some light on
this hot topic, a systematic literature review (SLR) (Denyer and Tranfield, 2009;
Tranfield et al., 2003) was used to answer the following research questions: RQ1.
What are the main current blockchain applications in SCM? RQ2. What are the main
disruptions and challenges in SCM because of blockchain adoption? RQ3. What is the
future of blockchains in SCM? Thus, this research aims to shed light on blockchain–
SCM integration, making a significant contribution to the literature and also
having implications for practitioners and decision makers interested in gaining an
in-depth understanding of this cutting-edge technology. Additionally, blockchain
technology is a multidisciplinary field, and this study intends to show the current
journals that are in the vanguard regarding this hot topic. This study brings
relevant insights to scholars and practitioners interested in advancing blockchain–
SCM integration. It is a first investigation that analyses the blockchain–SCM
integration literature from 2008 to 2018 (February). Also, the SLR revealed
important gaps in the literature, highlighting managerial implications and
providing a robust research agenda. The rest of this paper is organised as follows.
In Section 2, we introduce the basic concepts of SCM and blockchains. In Section 3,
we justify and present the main aspects of the systematic-review methodology based
on Tranfield et al. (2003) and Denyer and Tranfield (2009). Section 4 provides the
main research findings, and Section 5 provides a discussion addressing the three
RQs. In Section 6, the managerial implications based on the findings are
highlighted. Section 7 details the research implications and proposes an agenda for
future research. Section 8 presents the main contributions from the perspectives of
methodology, scope, and insights. Finally, in Section 9, final remarks and
limitations are presented. 2. Supply chain management and blockchains: basic
concepts 2.1 Supply chain management The Council of Supply Chain Management
Professionals (CSCMP), proposed the following definition of SCM: [SCM] encompasses
the planning and management of all activities involved in sourcing and procurement,
conversion, and all logistics management activities. Importantly, it also includes
coordination and collaboration with channel partners, which can be suppliers,
intermediaries, third party service providers, and customers. In essence, supply
chain management integrates supply and demand management within and across
companies. [Council of Supply Chain Management Professionals (CSCMP), 2018] Despite
this robust definition, there is no consensus, mainly between scholars, on a
unified definition of SCM. For instance, Stock and Boyer (2009) analysed 173 SCM
definitions and presented an all-encompassing definition for SCM as: The management
of a network of relationships within a firm and between interdependent
organizations and business units consisting of material suppliers, purchasing,
production facilities, logistics, marketing, and related systems that facilitate
the forward and reverse flow of materials, services, finances and information from
the original producer to final customer with the benefits of adding value,
maximizing profitability through efficiencies, and achieving customer satisfaction
(Stock and Boyer, 2009, p. 706) Another well-articulated and widespread SCM
definition was provided by Mentzer et al.(2001) who defined SCM as: The systemic,
strategic coordination of the traditional business functions and the tactics across
these business functions within a particular company and across businesses within
the supply chain, for the purposes of improving the long-term performance of the
individual companies and the supply chain as a whole. (Mentzer et al., 2001, p. 18)
In this study, we consider that these definitions are convergent and complementary;
while the CSCMP highlights the collaboration, integration and coordination needs
for the entire supply chain, Stock and Boyer’s (2009) definition considers the
importance of network relationships, and Mentzer et al.’s (2001) definition defines
the role of these relationships in long- term performance improvement. This study,
therefore, follows the approach provided by these definitions to understand the SCM
relationship with, and the potential disruptions caused by, blockchain technology.
2.2 Blockchain technology Blockchains emerged as a technology to support
transactions in the cryptocurrency field (Nakamoto, 2008). One formal definition of
blockchain technology, provided by Risius and Spohrer (2017), is: Blockchain
technology refers to a fully distributed system for cryptographically capturing and
storing a consistent, immutable, linear event log of transactions between networked
actors. This is functionally similar to a distributed ledger that is consensually
kept, updated, and validated by the parties involved in all the transactions within
a network. In such a network, blockchain technology enforces transparency and
guarantees eventual, system-wide consensus on the validity of an entire history of
transactions. (Risius and Spohrer, 2017, p. 386) Despite this formal definition, it
is clear that there are some other distinctive blockchain characteristics, like
data security, tamper-proof transactions and data validation among the network
members. A distributed ledger definition is also necessary. Hyperledger (a Linux
Foundation initiative for open-source blockchains) defined a distributed ledger as:
[...] a multi-party database with no central trusted authority. The differentiating
nuance is that when transactions are processed in blocks according to the ordering
of a blockchain, the result is a distributed ledger. (Hyperledger, 2018) However,
because of the novelty of this subject, blockchains face similar difficulties to
SCM in terms of generating a consensual definition. For instance, Al-Saqaf and
Seidler (2017, p. 339) provided a brief definition of a blockchain as “a
distributed digital ledger or accounting book”. Christidis and Devetsiokiotis
(2016, p. 2293) defined a blockchain as “a distributed data structure that is
replicated and shared among the members of a network”. Another recent blockchain
definition was provided by de Leon et al.(2017) as: A digital information recording
method capable of recording data using a logbook approach and with the following
essential characteristics: 1-Ordered, 2-Incremental, 3-Sound (cryptographically
verifiable up to a given block) and 4-Digital. (de Leon et al., 2017, p. 288) In
this context, it is clear that blockchain technology works as “a digital logbook of
transactions”, in which decentralisation, Blockchain and supply chain Maciel M.
Queiroz, Renato Telles and Silvia H. Bonilla Supply Chain Management: An
International Journal Downloaded by Macquarie University At 01:20 13 February 2019
(PT) disintermediation, transaction sharing and tamper-proof can be considered as
its main characteristics. Thus, the blockchain concept can be understood as
associated with transactions’ disintermediation, i.e. without a central authority
to validate and offer credibility to transactions. This feature implies some
impacts on SCM, involving aspects such as member relationships, collaboration,
trust and change in the role-based operations model for cloud agility, among other
consequences. Figure 1 depicts the main elements of blockchain technology in a
schematic form. The blocks are linked in a chain (blockchain) in which each block
has a hash of the previous blocks and a record of all transactions
(Khan and Salah, 2018). Furthermore, because the block has a copy of all
transactions and it cannot be modified, the technology ensures transparency and
enhances trust over the network (Khan and Salah, 2018; Yeoh, 2017). Thus, in Figure
1, each block has the hash of the prior block, for instance, block n 1 3 has the
hash of the block n 1 2 and so on, ensuring traceability. Consequently, this
process validates the preceding blocks’ information back to the first block that
started a process (Hou et al., 2018). 2.3 Blockchains and supply chain
relationships Blockchains, applied in a SCM context, will likely lead to disrupting
transformations in all types of industries. Hence, traditional relationship models
are already being reconfigured, mainly because of the disintermediation of the
transactions. To further understanding of blockchains and supply chain
relationships, Figure 2 illustrates a smart-contract operation. Figure 2
exemplifies the trade between a producer A and a supermarket B. After the
fulfilment of the trade conditions for both, a contract is written, coded and
“stored” in a blockchain structure. A contract is triggered when it satisfies the
conditions of the negotiation. After that, money and goods are transferred
according to the contract. This operation does not rely on an intermediary.
Therefore, it not only speeds up the transaction but also promotes costs reduction
and improves trust, since, within the network, all participants (nodes or actors)
have a copy of the ledger (Al-Saqaf and Seidler, 2017; Yeoh, 2017).
The blockchain technology is an important distributed secure technology in the
prevailing Industry 4.0 era of today and has attracted great attention from both
academia and industry (Dobrovnik et al., 2018; Swan, 2017). Blockchain is known as
distributed ledger technology (Tschorsch and Scheuermann, 2016; Zyskind et al.,
2015), which allows participants to secure the settlement of transactions, archive
the transaction, and transfer assets at a low-cost (Tschorsch and Scheuermann,
2016). It is not only a new type of internet infrastructure based on distributed
applications but also a new type of supply chain network, which may provide a new
paradigm for future business (Hackius and Petersen, 2017; Mansfield-Devine, 2017;
Swan, 2015). As an emerging technology, a lot of revolution and research have just
begun regarding this distributed technology. A growing number of products are
delivered to the customers through supply chains that are composed of independent
firms (Christopher and Peck, 2012; Wang et al., 2018). As a result, today’s
businesses do not only compete as isolated companies, but also as part of a large
supply chain network (Christopher, 2005; Wang et al., 2015). Companies face
increased uncertainty, challenges, and constraints, due to globalization, higher
customer expectation, market competition, supply chain complexity and uncertainty,
which call for coordination and cooperation across the supply chains (inter- and
intra- supply chains) and the needs Wang, et al.: Blockchain and Supply Chain
Management: A New Paradigm for Supply Chain Integration and Collaboration 112
Operations and Supply Chain Management 14(1) pp. 111 – 122 © 2021 for information
technology (Huddiniah and Er, 2019). However, supply chains often are fragmented
with internal competition, limited information exchange and price negotiations
occurring behind closed doors in New Zealand (Bezuidenhout, 2017). In addition,
these constraints directly influence the business performance and often result in
challenges and constraints, such as high operation costs or capacity shortage,
which could be resolved by the Blockchain revolution (Tapscott and Tapscott, 2016).
This paper attempts to explore blockchain applications in supply chain management
and investigate the relationship between blockchain and supply chain collaboration
and integration. Based on the Socio-Technical Theory (STT), technology is an
important variable to optimise the process, task, structure (Bostrom and Heinen,
1977). STT consists of two systems, namely the social system and the technical
system. At the time when this study started in mid-2018 to explore the use of new
technologies in the New Zealand industry 4.0 era, there was a paucity of blockchain
research conducted in the New Zealand context. We narrowed down the scope of the
research by focusing on the technical system, which is concerned with the
processes, tasks and technology needed to transform inputs to outputs (Cartelli,
2007). Blockchain shows a huge potential to reconfigure the task structure and
manage the constraints in supply chains (Cole et al., 2019). Nevertheless, there
have been very few studies conducted on the nexus between blockchain and supply
chain integration and collaboration (Bai and Sarkis, 2020; Chang and Chen, 2020).
Therefore, this paper tries to fill this research gap by focusing on the following
two main research questions: RQ1: What are the key attributes of blockchain
technology applicable to supply chain management? RQ2: How does the blockchain
technology enable the supply chain integration and collaboration? To answer the
research questions, a qualitative research is designed in this study. We used both
desk research and informal interview techniques to tackle the questions to ensure
the research reliability and validity. First, we reviewed the relevant literature,
previous studies, and business cases in blockchain and supply chain and extracted
the important attributes of blockchain. Then, informal interviews were conducted to
verify the results in New Zealand industries. In addition, we asked the
interviewees whether they feel that the blockchain technology could help their
business to improve the integration and collaboration in a supply chain. Over 80%
of the respondents provided positive feedback regarding the blockchain technology.
The results may demonstrate the practical implications of blockchain for supply
chain management, by shedding light on supply chain integration and collaboration.
The rest of the paper is organised as follows. Section 2 describes the relevant
literature and background information. Section 3 briefly introduces the research
methods and Section 4 presents the research results. Section 5 discusses the
important practical features and potential challenges. Finally, Section 6 concludes
the paper with further research directions. 2. BACKGROUND 2.1 What’s Blockchain?
Blockchain is a decentralized digital ledger that can be programmed to distribute
and store data. It is also known as a distributed ledger, which is based on a peer-
to-peer (P2P) or decentralized network, consisting of a continuous sequence of
blocks. Swan (2017) suggests that the terms blockchains and digital ledgers are
generally interchangeable. In a blockchain network, all the parties can
simultaneously share and record the blocks, which must be verified and validated by
all users in the network. Blocks are linked by the cryptographic hash function.
Every transaction is trackable by examining the block information linked by hash
keys (Chen et al., 2018; Zheng et al., 2018; Zheng et al., 2017). Blockchain
advocates claim transparency, speed, accessibility and non-falsifiability as the
cornerstones of this new paradigm (Apte and Petrovsky, 2016). Sultan and Lakhani
(2018) suggest that the blockchain is a decentralised database containing
sequential, cryptographically linked blocks of digitally signed asset transactions,
governed by a consensus model. All ledgers are encrypted and uploaded to block
network with a timestamp, hence all blocks are integrated with time sequence as the
whole book. Apparently, if a user wants to change the record, s/he must adjust the
entire book records, because blockchain utilises distributed database storing all
data, and the core concept of blockchain is distributed computing instead of
centralisation. In other words, it will not work if hackers only change information
on one block. Distributed computing not only saves cost of calculating, it also
solves the data security issue as all participators have the same “book”. In
addition, in a blockchain, every node transfers data by using P2P approach to
reduce the cost of achieving decentralization. Given there is not a centralize
server, all data are distrusted and stored in individual computers, therefore
organization cannot change any data without consensus across the whole blockchain
network. On the contrary, when there is a new transaction in the whole network,
everyone will verify and add it into their “books” (Swan, 2015). Although the
blockchain technology is relatively new, there have been three generations of
blockchains including the Blockchain 1.0, which is the core technology used to
create the cryptocurrencies, such as Bitcoin, Litecoin, etc. The first generation
blockchain appeared in 2009, as a part of Bitcoin, and provided a technique for an
incorruptible digital ledger of economic transactions. In 2015, Ethereum used an
improved blockchain 2.0 for validating transactions. The Blockchain 2.0 was
developed from the decentralised digital ledger, which includes many different
categories, such as the Blockchain 2.0 protocols, smart contracts and decentralised
application. With the development of computer technology, the blockchain 2.0
protocols can be used to manage not just financial transactions but virtually
everything of value. The Blockchain 2.0 space is still in development, many
Blockchain 2.0 projects are mainly applied for the transferring of all kinds of
assets beyond currency using the blockchain (Swan, 2015). The primary argument for
Blockchain 1.0 and 2.0 transactions is the economic efficiency and cost savings
afforded by trustless interactions in decentralized network models. Blockchain
Wang, et al.: Blockchain and Supply Chain Management: A New Paradigm for Supply
Chain Integration and Collaboration Operations and Supply Chain Management 14(1)
pp. 111 – 122 © 2021 113 3.0 is still emerging. Yli-Huumo et al. (2016) and Garrod
(2016) argue that the future research directions for blockchain are not clear. We
may consider blockchain as a new paradigm, which is a decentralised network for
supply chain integration and collaboration beyond currency, payment, and economics.
2.2 Supply Chain Integration and Collaboration Supply chain management is the
integration of material, information, and financial flows in a network of companies
or organisations. Multiple supply chain partners need to work together
collaboratively to make and deliver products and services to the consumer. Supply
chain management concept fundamentally changes the nature of a firm as control is
no longer based on direct control of the internal business processes, but rather
based on integration across member organisations in the supply chain (Lai et al.,
2004; Porter, 2019). Supply chain collaboration is considered as an important
factor to achieve a win-win solution for different shareholders in a supply chain
(Ramanathan and Gunasekaran, 2014; Tsou, 2013). Moreover, Soosay and Hyland (2015)
stress that collaboration goes beyond integration by including long-term
commitments to technology sharing and to closely integrated planning and control
systems. There are different forms of supply chain collaboration including
collaborative planning, collaborative decision making and collaborative execution
(Ramanathan and Gunasekaran,
2014). Supply chain collaboration requires a high level of commitment, trust,
joint decisions and information sharing (Liao et al., 2017; Pradabwong et al.,
2017; Soosay and Hyland, 2015; Zhang and Cao, 2018). Supply chain integration
includes internal, external, supplier and customer integration (Alfalla-Luque et
al., 2015; Flynn et al., 2010; Kim, 2006; Maiga, 2016). A high level of supply
chain integration and collaboration lead to higher levels of supply chain
performance (Chen et al., 2017; Wiengarten et al., 2016). In this paper, we
consider the supply chain integration and collaboration as a firm’s capability to
sense, collaborate, coordinate and reconfigure the elements in a supply chain
including internal cross-functional integration and external integration with
suppliers and customers. Hafeez et al. (2002) regard capability as the ability to
make use of resources to perform some task or activity; they define a resource as
anything, tangible or intangible, owned or acquired by a firm including technology.
In this sense, blockchain can be understood as a technology to facilitate the
firm’s ability, e.g., ability of integration and collaboration from a resource-
based view (RBV) in this study.
Blockchain is a distributed database of transactions, ledgers, and digital
occurrences (Crosby 2016) that provides a decentralized platform that serves as an
immutable platform for participating parties (Zeng et al. 2018). Blockchain was
introduced in 2008 by Nakamoto for a peer-to-peer financial transaction procedure
named Bitcoin (Nakamoto 2019). Before Bitcoin, most people trusted a centralized
middle man, such as banks and governments, to make financial trans- actions (Hutt
2018). Bitcoin revolutionized that by providing a transparent and immutable
procedure without a central author- ity. Bitcoin came as a digital currency, but
the blockchain technology could have many more implications (Swan 2015). However,
we need to briefly narrate how blockchain works to interpret its impact in other
fields. Blockchain is a chain of blocks. Each block contains the data, hash, and
the hash of the previous block. Hash is a unique code of letters and numbers, which
is the identification of the block. The common hashes are usually 256 bits. Hashes
are generally written in the hexadecimal numeral system because it saves some
digits. Decimal is the standard numerical system that uses 0 to 9 numbers, and the
hexadecimal uses these numbers and six extra numbers. The hash of the last block
refers to the previous block that makes the chains of blocks. The hashing function
is taking input and generating unpredictable output through a hashing algorithm
(Vujicic et al. 2018). Hashing is a significant aspect of blockchain technology
immutability (Kumar and Sai 2020), which empowers this technology to contribute to
other fields rather than only finance. There are numerous implications and
applications for blockchain, ranging from financial transac- tions (Tapscott and
Tapscott 2017), manufacturing (Abeyratne and Monfared 2016), logistics (Pournader
et al. 2020), and sup- ply chain management (Saberi et al. 2019). Responsible
editor: Philippe Garrigues * Amir M. Fathollahi-Fard
[email protected] 1 School of the Built Environment,
University of Technology Sydney, Sydney, Australia 2 Department of Electrical
Engineering, École de Technologie Supérieure, 1100 Notre-Dame St. W, Montréal,
Canada 3 Department of Management Studies and Quantitative Methods, Parthenope
University, Naples, Italy Environmental Science and Pollution Research
https://doi.org/10.1007/s11356-021-13094-3 Recent studies indicate an inclination
of implementing blockchain in supply chain management by scholars and in- dustry
managers (Pawczuk 2017; Pournader et al. 2020). Although blockchain in supply chain
is in its early stages, it is predicted to transform supply chain significantly in
the fu- ture (Kamble et al. 2019; Winkelhaus and Grosse 2020). Surveys show that
supply chain managers and scholars are reasonably optimistic about blockchain in
supply chain man- agement (Hackius and Petersen 2017). Although academic papers on
blockchain in supply chain management are scarce (Fathollahi-Fard et al. 2020a, b),
we witness the increasing quantity of blockchain studies in specific supply chain
knowl- edge areas (Pournader et al. 2020). For example, Min (2019a, b) studied
risk, and Hughes et al. (2019) studied information management in supply chain.
Moreover, many articles such as Nowiński and Kozma (2017), Ying et al. (2018),
Tapscott and Tapscott (2017), and Sikorski et al. (2017) focused on the finance
side of blockchain contribution to supply chain. It goes without saying that there
are still limited papers on blockchain in a specific angle of supply chain
management. Namely, Francisco and Swanson (2018) explored the transparency and
traceability that blockchain brings into supply chain management. Furthermore,
Saberi et al. (2019) studied the adoption barriers of blockchain and Kshetri (2018)
considered supply chain management objectives. The blockchain is not the only
technology that attracted the atten- tion of supply chain managers and scholars.
Other emerging technologies such as Internet of Things (IoT), smart contract, and
artificial intelligence would transform supply chain man- agement significantly
(Winkelhaus and Grosse 2020; Xu et al. 2018). Those emerging technologies can
either contribute in- dividually or integrate with blockchain in supply chain. Most
of the papers on this topic studied specific technologies. There is a scarcity of
an academic paper that reviews all the integrat- ed technologies with blockchain in
supply chain management (Venkatesh et al. 2020). A few literature reviews were
conducted on blockchain in supply chain management in the last few years. Some of
these reviews have focused on the specific angel of supply chain such as
sustainability (Saberi et al. 2019; Venkatesh et al. 2020), provenance (Kim and
Laskowski 2016), and resilience (Min 2019a, b), while others have been broadly
covered the topic with a comprehensive view. Still, they have been con- ducted
relatively straightforwardly with summary statistics of published papers and
topical areas (Keogh et al. 2020). Each of the studies has insights into this
topic, but rigorous bibliometric, citation, and co-citation analysis of this
literature can provide further insights not previously grasped. Bibliometric
analysis is a powerful method to identify emerging topical areas (Ellegaard and
Wallin 2015; Fahimnia et al. 2015; Merediz-Solà and Bariviera 2019). Furthermore,
it can facilitate identifying influential re- searchers, research clusters,
organizations, and most contributed countries to acknowledge the significant
partici- pants (Jalali et al. 2019; Mishra et al. 2018; Muhuri et al. 2019). This
study provides a comprehensive evaluation of the field by conducting bibliometric
and citation analysis, starting with a pool of 769 published papers on blockchain
in supply chain management. Citation and co-citation analysis are also powerful
tools for identifying influential studies and trends of the topic. This paper
presents the findings of the citation analysis to support the results of the
bibliometric anal- ysis. Furthermore, we conducted a co-citation analysis to iden-
tify influential studies. The algorithmically obtained co- citation results were
set to conduct a further investigation for defining supply chain sections, other
integrated technologies with blockchain, and blockchain’s potential contributions
in supply chain management. Blockchain in supply chain management Blockchain
definition and its boundaries: Blockchain is a distributed ledger database of
records, or trans- actions, or digital incidents that have been executed and con-
veyed by participants (Crosby 2016). Numerous articles have been published to
clarify how blockchain technically works in recent years (see among Francisco and
Swanson 2018; Gupta and Sadoghi 2018; Nakamoto 2019). Blockchain technology has
been famed based on cryptocurrencies, namely, Bitcoin (Underwood 2016). Still,
there are numerous implications for it, ranging from financial services (Zeng et
al. 2018), manufacturing (Abeyratne and Monfared 2016), and supply chain (Francisco
and Swanson 2018). Here, we focus on blockchain in supply chain management and
blockchain’s im- plications rather than blockchain technology’s technical mecha-
nism. Accordingly, we excluded the blockchain technological aspects such as
algorithm, hash function, wallet, signature, and protocols. Supply chain management
definition and its boundaries Definitions of supply chain management differ across
authors (Mentzer et al. 2001). Cooper et al. (1997) defined supply chain management
as managing the total integrative flow of materials from raw material suppliers
through production, warehousing, and transportation to the end users. Supply chain
management consists of various thresholds, and identi- fying its boundaries is an
essential step. Here, we consider all the supply chain echelons from supply to
manufacturing, dis- tribution, and customer side activities. Furthermore, supply
chain management represents the management of the whole chain in this study. Also,
we consider only the forward supply Environ Sci Pollut Res chain, so reverse
logistic and closed-loop supply chain excluded.
Introduced by one or more individuals under the pseudonym Satoshi Nakamoto [1], the
cryptocurrency Bitcoin and the underlying blockchain technology (BCT) have created
a tremendous hype around electronic payment systems using the peer-to-peer paradigm
of the internet [2, 3]. More generally, BCT provides the infrastructure that
enables secure direct exchange of value between participants without any financial
intermediary (‘internet of value’) [4]. Blockchain is a shared ledger that allows
for immutable storage of verified transaction data [5]. Therefore, The Economist
called blockchain the ‘trust machine’ [6] since a ledger most fundamentally
represents a trustworthy record of business activity. Trust in business
relationships is a key ingredient for inter-company supply chain (SC) collaboration
[7, 8]. Consequently, supply chain management (SCM) is generally viewed as a major
field of application for BCT which is confirmed by a series of recent news items
[9]. Most notably, IBM and Maersk announced a joint venture to commercialize BCT in
container shipping and global trade activities [10]. In the academic community, the
interest in BCT and its business applications has been steadily growing over the
last years [11] which is confirmed by a series of recent literature reviews (see
[12, 13, 14, 15, 16]). An overarching research framework for BCT is provided by
Risius and Spohrer [17]. In the slipstream of this development, SCM has only
attracted minor interest among various application domains (see [18]). While
Korpela et al. [19] focus on the issue of data integration in digital SCs using
BCT, Sternberg and Baruffaldi [20] provide a first summary of potential
applications of BCT in SCM from the literature. Hackius and Petersen [21] and
Petersen et al. [9] use an expert survey of logistics professionals to explore
potential applications and future prospects of BCT in SCM. Petersen et al. [9]
synthesize application clusters of BCT in logistics and SCM from publicly available
case examples. To the best of our knowledge, there is no comprehensive perspective
on use cases of BCT in SCM. We intend to fill this gap with this paper. The
contribution of this paper is twofold: first, a comprehensive framework is
developed positioning BCT and its potential areas of application in the domain of
SCM. In contrast to previous studies, this paper uses a deductive approach mapping
distinctive features of BCT to use cases in SCM. Second, the framework is applied
to the results of a structured literature review Proceedings of the 52nd Hawaii
International Conference on System Sciences | 2019 URI:
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6885 and a secondary dataset of BCT-enabled SC innovations. This allows for
determining a current state of the art of BCT-enabled applications in SCM and for
identifying future perspectives in this field. The remainder of this paper is
structured as follows: in section 2, we provide conceptual foundations of SCM and
BCT and derive the corresponding framework of use case clusters. The systematic
literature review and the analysis of the secondary dataset are conducted in
sections 3 and 4. The findings are discussed in section 5. Section 6 concludes the
paper with a summary of the findings and an outlook for further research. 2.
Conceptual Foundations 2.1. Supply Chain Management SCM covers two major tasks
according to the Council of Supply Chain Management Professionals (CSCMP) [22]: (i)
the planning, implementing, and controlling of primary activities that create and
deliver value for the ultimate customer (esp. procurement, manufacturing, and
logistics), and (ii) the integration and coordination of corresponding business
processes within and across companies. While integration refers to the managerial
and organizational challenges of forming a network of mostly independent companies,
coordination is concerned with ‘technical’ implementation of processes and systems
to foster alignment of material, financial, and information flows along the SC [8].
The importance of information and communication technology for SCM is widely
acknowledged [23, 8]. Technology represents a major driver and constitutive element
of SC innovation [24]. Recent advances as part of the Fourth Industrial Revolution
(aka ‘Industry 4.0’ or ‘Industrial Internet of Things’) promise radical changes for
various sectors including manufacturing and logistics [25]. Industry 4.0 envisions
intelligent and connected physical assets, i.e., smart products and machines that
operate autonomously and that can form self-coordinating systems such as smart
factories or smart SCs [26]. In the slipstream of these developments, BCT and its
implications on SCM receive increasing attention [21, 20]. 2.2. Blockchain
Technology Most fundamentally, a blockchain is a distributed ledger that is shared
and agreed upon a peer-to-peer network [27, 20]. A blockchain contains a single
record of the data which is stored in blocks on every participant’s node [12]. Each
block corresponds to a timestamped record that is verified through a defined
consensus protocol of the blockchain network and secured via public-key
cryptography (‘hashing’) [13]. This basically eliminates the need for a trusted
central entity. Since blocks are chained via their hash codes, information on the
blockchain is immutable [28] and thus allows the user to obtain provenance
information and to trace status changes over time [29]. A blockchain may execute
computational logic in the form of ‘smart contracts’ (often referred to as
chaincode) [2]. A smart contract is a trusted application that is installed on the
nodes of the blockchain [30, 31]. With respect to access rights, permissionless and
permissioned blockchains can be distinguished [32]. Both of these types can be
either private or public depending on the ownership over data and infrastructure
[33]. There are two dominant types of blockchains: permissionless-public
blockchains are freely accessible via the internet (e.g. Bitcoin blockchain). In
permissioned-private blockchains (e.g. Hyperledger Fabric) [28, 31], however, users
need to register and are granted access by a network administrator based on a pre-
defined approval process [5]. Although BCT enforces transparency, it allows for
pseudonymity since transactions are settled between 30-plus-character alphanumeric
addresses [2]. BCT is not restricted to financial transactions related to Bitcoins;
any asset – both tangible (physical good) and intangible (property right or
financial claim) – that entails value can be transfered onto or off the ledger [34,
20]. The digital representative of this asset on the blockchain is called a ‘token’
[35]. While blockchain is largely viewed as a general purpose technology that
further increases productivity, various authors argue that BCT will change the
industrial organization [4, 35]. In a similar vein, Davidson et al. [36]
characterize blockchain as an institutional technology that fosters economic
coordination. As a consequence, blockchains represent a novel type of institution
that is different from markets, hierarchies (firms), and relational contracts as
described by Williamson [37]. More precisely, blockchains constitute decentralized
collaborative (or autonomous) organizations for value creation and exchange [38].
SCs are networks of independent companies that are constituted by relational
contracts [39]. Relational contracts represent informal agreements that are
“sustained by the value of the future relationship” [40] and thus trust becomes an
essential factor of SC relationships [41]. However, a blockchain removes trust from
the equation and is therefore fundamentally different from an SC taking an
institutional viewpoint. For the purposes of this paper, we mainly focus on the
impact of BCT as a general purpose technology in SCM. Page 6886 2.3. Linking SCM
and BCT BCT provides four key features that can enhance integration and
coordination among the members of an SC [35]: (1) transparency, (2) validation, (3)
automation, and (4) tokenization. Transparency relates to the shared ledger of
information which is aggregated from various sources and participants of the
blockchain. Immutability of records and consensus-based verification enable
validation of information [42]. Automation refers to the opportunity to execute
smart contracts based on verified information on the blockchain. BCT allows
creation of tokens that represent a specific claim on any valuable asset and their
exchange between blockchain members (tokenization) [43]. Enabled by these four key
features of BCT, one can derive corresponding use case clusters in SCM that build
on one another: 1. SC Visibility: One of the main causes for SC inefficiencies is
poor end-to-end transparency which also leads to the so-called bullwhip effect [8].
BCT allows sharing real-time information about the location and status of an object
between multiple SC members [9]. Given the opportunities of sensor technology and
the Internet of Things [26, 44], any measurable condition such as product
temperature in a cold chain or availability of technical equipment operating in the
SC can be tracked. This improves data accuracy enhancing collaborative planning and
execution as well as the implementation of preventive and reactive risk management
measures [35]. 2. SC Integrity: Given a shared ledger of transparent and immutable
records, BCT provides the opportunity to trace assets back to their origin [9].
Provenance information to certify authenticity ensures integrity of assets
involving both products and technical equipment. This could enforce responsible
sourcing and allow detecting or even preventing product counterfeit and other
fraudulent actions [35]. Applications could involve tracing of asset ownership
after sale for warranty purposes. Furthermore, BCT eases
paperwork in global trade by ensuring validity of freight documents, e.g. in
customs clearance [21]. 3. SC Orchestration: Combining transparency and validation
with automation via smart contracts, one could envision SCs that operate highly
automated based on pre-specified rules [45]. This increases speed and eases
coordination since information and corresponding decisions or measures are
propagated throughout the SC. More specifically in case of a machine failure, the
machine could order the spare part from the supplier, request maintenance service,
and inform downstream parties about expected delays. Another benefit of automation
is ex-post enforceability of contracts, i.e., contractual parties cannot reverse
their commitments [35]. Consequently, BCT provides the necessary foundation to
extend the smart factory paradigm of Industry 4.0 to inter-company SCs. 4. SC
Virtualization: Virtualization is a well-known approach in IT infrastructure
management to increase utilization and flexibility of IT assets by creating a
logical representation of physical hardware in software [46]. Tokenization of
physical SC assets such as technical equipment and inventories follows a similar
idea since there is another opportunity besides shifting acquisition/sale of SC
assets to the blockchain. Claims on capacities or ordering options could be issued
as tokens and circulated outside normal (bilateral) contractual relationships.
Similar to the virtualization of IT hardware, this would allow for improved
capacity utilization of SC assets since excess capacities could be monetized.
Moreover, virtualization would increase contract flexibility and enable
reallocation of corresponding risks in SCs in general.[35] While the aforementioned
use cases mainly focus on managing physical assets and material flows, cross-
cutting applications that support the management of corresponding financial claims
and financial flows are grouped in a separate use case cluster [35]: 5. SC Finance:
Applications supporting financial SCM are a natural ‘fit’ for BCT given the close
ties to cryptocurrencies and the important role of financial intermediaries in
global trade [9, 47]. Consequently, there are two types of applications: first, BCT
eases the settlement of multi-party and multi-tier financial transactions in SCs
that result from collaborative value creation of blockchain members [38, 35].
Second, transparent and validated records as well as automated transactions and
tokenized financial claims simplify financing of working capital (including
inventories and accounts receivable net of accounts payable [48]) from blockchain
members which also lowers financing costs [47]. For this purpose, SC assets could
be collaterialized by issuing corresponding financial claims using tokens [35].
Modern supply chains are inherently complex comprising multi-echelon,
geographically disjointed entities competing to serve consumers (Johnson 2006;
Lambert and Enz 2017). Globalisation, diverse regulatory policies, and varied
cultural and human behaviour in supply chain networks make it almost impossible to
evaluate information and manage risk in this intricate network (Sarpong 2014;
Ivanov, Dolgui, and Sokolov 2018). Inefficient transactions, fraud, pilferage, and
poorly performing supply chains, lead to greater trust shortage, and therefore, a
need for better information sharing, and verifiability. Traceability is becoming an
increasingly urgent requirement and a fundamental differentiator in many supply
chain industries including the agri-food sector (Costa et al. 2013), pharmaceutical
and medical products (Rotunno et al. 2014), and high value goods (Maurer 2017).
Luxury and high value items whose provenance might otherwise be reliant on paper
certificates and receipts can easily be lost or altered. In fact, lack of
transparency in the supply value of any item prevents supply chain entities and
customers from verifying and validating the true value of that item. The cost
involved in handling intermediaries, their reliability, and transparency further
complicate managing this traceability in the supply chain. Strategic and
reputational competitive issues arise from these risks and lack of transparency.
For example, the salmonella outbreak case linked to Maradol-brand papayas, with
hundreds of people in the United States has fallen ill, could disparage a brand and
its supply chain. Although the centre for disease control reported the origin of
the contaminated papayas;1 not all shipments were traceable or could be recalled,
while injurious results and safety concerns continued. Another case is the 2015 E.
coli outbreak2 within Chipotle Mexican Grill outlets, leaving dozens of customers
ill. This outbreak caused significant image concerns for Chipotle, causing its
stock prices to fall by up to 42%. Lack of transparency and accountability across
Chipotle supply chains and capability to monitor multiple suppliers in real- time
were some obstacles for Chipotle. These obstacles could have caused further
contamination prevention even after its discovery. Current supply chains rely
heavily on centralised, sometimes disparate and stand-alone information management
sys- tems, that are within organisations; for example, enterprise resources
planning systems, which has its own pitfalls. Supply chain entities require
significant trust for relying on one single organisation or broker for storing
their sensitive and valuable information (Abeyratne and Monfared 2016). Single
point failure is another disadvantage of centralised information systems which
leaves the whole system vulnerable to error, hacking, corruption, or attack (Dong
et al. 2017). *Corresponding author. E-mail: [email protected] © 2018 Informa UK
Limited, trading as Taylor & Francis Group 2 S. Saberi et al. Supply chain practice
and strategy is also facing emergent pressures to consider and certify supply chain
sustainability. Sustainability has been defined by the triple-bottom-line concept
that includes a balance of environmental, social, and business dimensions when
managing the supply chain (Seuring et al. 2008). An important strategic and
competitive issue for sustainability in supply chains is the confirmation and
verification that processes, products, and activities within the supply chain meet
certain sustainability criteria and certifications (Grimm, Hofstetter, and Sarkis
2016). Such issues evoke questions on whether current supply chain information
systems can support information required for the timely provenance of goods and
services, in a secure manner that is clear and robust enough to trust. The solu-
tion to these complicated problems lies in improving supply chain transparency,
security, durability, and process integrity. The answer to this problem may be
blockchain technology (blockchain). New technological developments and applica-
tions with the concept of blockchain technology make these improvement goals more
organisationally, technologically, and economically feasible (Swan 2015; Abeyratne
and Monfared 2016). Blockchain technology as a potentially disruptive tech- nology
incorporating characteristics of a decentralised ‘trustless’ database allows for
global-scale transactions and process disintermediation and decentralisation
amongst various parties (Crosby et al. 2016). Some early use cases that exemplify
possibilities and concerns with blockchain technology exist. One of the more
popular cases involves Maersk and its partnership with IBM for it maritime
container management through blockchains. In this use case, IBM mentioned that
billions in savings could occur by having more accurate and trustworthy bills of
landing attached to containers (Groenfeldt 2017). Interestingly, although billions
of savings are mentioned, it is not clear that a full-fledged implementation was
possible due to scaling issues. Additionally, from a sustainable supply chain
perspective, Provenance, a blockchain service provider, has sought to integrate
blockchain technology in the seafood supply chain. In this case, transparency and
validity of sustainable practices were critical (Steiner and Baker 2015). Hence,
whether there are concerns related to environmental, economic, or social issues,
blockchain’s potential uses have seen significant discussion in the professional
literature. Although the blockchain use cases have increased over the years, just
as any potentially disruptive system or technology, blockchain faces various
obstacles and barriers in adoption and implementation by supply chain networks.
Blockchain is still in early stages of development with various difficulties from
behavioural, organisational, technological, or policy-oriented aspects (Crosby et
al. 2016; Lemieux and Lemieux 2016; Yli-Huumo et al. 2016). These issues will be
important in scholarly literature discourse for a number of years. At this time the
nascent practical issues are harbingers to scholarly debate and questions. The
issues have yet to be addressed integrally and effectively. In this article, we
initiate the debate with a focus not only on blockchain-based supply chain
challenges, obstacles, and barriers but also on the blockchain adoption benefits
and applications in the sustainable supply chain. The relationships to current
theory, the need for potentially new theory and research are also discussed; with
an outcome being some specific research propositions. This paper is organised as
follows. Blockchain technology is introduced in Section 2 and its application in
managing a supply chain is described in Section 3. Section 4 presents the
advantages of blockchain to maintain sustainability dimen- sions in a supply chain
network. In Section 5, the barriers and obstacles facing blockchain technology
implementation in a supply chain and supporting sustainability are reviewed and
clustered into four different categories. Research directions and propositions are
presented in Section 6. Finally, Section 7 concludes the paper. 2. Blockchain
technology Blockchain technology is a distributed database of records or shared
public/private ledgers of all digital events that have been executed and shared
among blockchain participating agents (Crosby et al. 2016). Its history can be
traced to distributed ledger technology. Blockchain technology differs from most
existing information systems designs by including four key characteristics; non-
localisation (decentralisation), security, auditability (Steiner and Baker 2015),
and smart execution (see Figure 1). In blockchain, an agent creates a new
transaction to be added to the blockchain. This new transaction is broadcast to the
network for verification and auditing. Once the majority of nodes in the chain
approve this transaction according to pre-specified approved rules, this new
transaction is added to the chain as a new block. A record of that transaction is
saved in several distributed nodes for security. Meanwhile, the smart contract, as
a critical feature of blockchain technology allows the performance of credible
transactions without third parties’ involvement. A major difference between the
current design of the Internet and blockchain technology is that the Internet was
designed to move information (not value) and to move copies of things (not original
information). In blockchains, value is represented in transactions recorded in a
shared ledger and secured by providing a verifiable, time-stamped record of
transactions, which provides secure and auditable information (English, Auer, and
Domingue 2016). These transactions appear through a verification process that is
consistent with network consensus rules. Once the new record is verified and added
to the blockchain, multiple copies are created in a decentralised manner to create
trusting chain. International Journal of Production Research 3 Figure 1. Steps in
blockchain information and transactions. Decentralisation is an important property
of blockchain technology and is a check on any adulteration of information, thus
increasing information validity. Removing collectively maintained records are
impractical and verified records of every single transaction are accessible to the
participants through distributed public or private ledgers (Crosby et al. 2016). A
centralised database is more susceptible to hacking, corruption, or crashing (Tian
2016). Trust is a main consequence of decentralisation since there is no need to
assess the trustworthiness of the intermediary or other participants in the network
(Nofer et al. 2017) and information is easily viewed and compared. This approach
does not require any particular behaviour on behalf of the participants; instead,
the underlying technology
guarantees the integrity of the system even in the face of dishonesty or idleness.
Participants are able to view the ledgers and analyse transactions. This feature
provides transparency (Tian 2016) while simultaneously ensuring anonymity through
preserving records behind cryptographics (Crosby et al. 2016). Blockchains can be
generalised and used to implement an agreed upon set of rules that no one, neither
the users nor the operators of the system, can break. They rely on a unique system
architecture platform for applications involving multiple parties who require
little trust in each other; for example, fragmented supply chains. Depending on the
technology application, blockchain design is different and can form public
(permissionless) or private (permissioned) ledgers and networks (Ølnes, Ubacht, and
Janssen 2017). Their design is different in terms of the network players and the
rules to maintain the blockchain. In a private or a closed blockchain, the parties
know each other and there is no anonymity, such as in a supply chain network with
known entities working to produce and distribute products. In this case, there
would be new roles such as certifiers, who provide certifications to supply chain
network participants and maintain this private network. Alternatively, in a public
or an open blockchain, to maintain trust with many anonymous users, cryptographic
methods are applied to let users enter the network and record their transactions
(Pilkington 2015). Meanwhile, a new generation of transactional applications that
establish trust, accountability, and transparency is fos- tered by means of
blockchain technology; these applications are managed by a so-called smart
contract. A smart contract is typically a software programme that stores rules and
policies for negotiating terms and actions between parties. It automat- ically
verifies that contractual terms have been met and executes transactions (Delmolino
et al. 2016). The logic of a smart contract is executed by the network of players
who reach consensus on the outcome of the contract execution. The contract executes
its code whenever it receives a message, either from a player in the network or
from another contract and updates the ledgers accordingly if the contractual terms
of its public or private network are met (Peters and Panayi 2016). Blockchain
technology first gained popularity as a platform for managing Bitcoin, a digital
cryptocurrency (Nakamoto 2008). Apart from the digital currency, blockchain
technology is a new computing and information flow paradigm with broad implications
for future development in supply chain management and logistics (Abeyratne and
Monfared 2016; Tian 2016; Maurer 2017). It is this perspective that we take in the
remainder of this paper. 4 S. Saberi et al. 3. Blockchain-based supply chain
Blockchains are, potentially, a disruptive technology for the design, organisation,
operations, and general management of supply chains. Blockchain’s ability to
guarantee the reliability, traceability, and authenticity of information, along
with smart contractual relationships for a trustless environment all portend a
major rethinking of supply chains and supply chain management. In this section, we
will dive deeper into the value proposition of blockchain technology and its appli-
cability to goods and manufacturing supply chain, its structure, and possible new
components for managing a supply chain. How blockchain functions within the context
of the supply chain are still open to interpretation and development. Unlike
bitcoin and other financial blockchain applications, which may be public;
blockchain-based supply chain networks may require a closed, private, permissioned
blockchain with multiple, limited players. But, the door may still be open for a
more public set of relationships. Privacy level determination is one of the initial
decisions. Figure 2 shows a general graphic of one traditional supply chain
transformation to a blockchain-based supply chain. Four major entities play roles
in blockchain-based supply chains; some not seen in traditional supply chains.
Registrars, who provide unique identities to actors in the network. Standards
organisations, who define standards schemes, such as Fairtrade for sustainable
supply chains or blockchain policies and technological requirements. Certifiers,
who provide cer- tifications to actors for supply chain network participation.
Actors, including manufacturers, retailers, and customers, that must be certified
by a registered auditor or certifier to maintain the system trust (Steiner and
Baker 2015). Influences on the supply chain product and material flows also exist.
Every product may have a digital blockchain presence so that all relevant actors
can have direct product profile access. Security measures may be set in place to
limit access, where only the parties with the correct digital keys have access to a
product. There is a range of data that can be collected, including the status of
the product, the type of product, and the standards that are to be implemented for
a product (Tian 2017). An information tag attached with a product represents an
identifier that links physical products to their virtual identity in the blockchain
(Abeyratne and Monfared 2016). One interesting structure and flow management
characteristic are how a product is ‘owned’ or transferred by a particular actor.
Actors gaining permission to enter new information into that product’s profile or
initiate a trade with another party will likely be a significant rule; where
gaining permission may require smart contract agreements and consensus. Before a
product is transferred (or sold) to another actor both parties may sign a digital
contract, or meet a smart contract requirement, to authenticate the exchange. Once
all parties have met contractual obligations and processes, transaction details
update the blockchain ledger. The records of data transactions would be
automatically updated by the system when a change is initiated (Abeyratne and
Monfared 2016). The blockchain technology can highlight and detail at least five
key product dimensions: the nature (what it is), the quality (how it is), the
quantity (how much of it there is), the location (where it is) and the ownership
(who owns it at any moment). In this way, the blockchain removes the need for a
trusted central organisation that operates and maintains this system and allows
customers to inspect the uninterrupted chain of custody and transactions from the
raw materials to the end sale. This information is recorded in ledgers as
transactions occur on these multiple blockchain information dimensions; with
verifiable updates. Blockchain reliability and transparency are meant to more
effectively facilitate material and information flow through the supply chain; with
automated governance requirements. This transformation may result in a broader
shift from an industrial durable, commodity, products economy to an information,
customisation economy. Production will rely more heavily on knowledge,
communication, and information and not necessarily on materials characteristics
(Pazaitis, De Filippi, and Kostakis 2017). For example, customers can track the
detailed information of products which would increase costumers’ trust associated
with product characteristics (Tian 2016). Smart contracts, as written rules stored
in the blockchain, can help to define network actor interaction amongst each other
and within the system. Smart contracts influence network data sharing between
supply chain participants and contin- uous process improvement. For example,
certifiers and standards organisations digitally verify actor profiles and
products. Actors and products have their own digital profile on the network, which
displays information such as description, location, certifications and association
with products. Each supply chain player can log in key information about a given
product and its status on the blockchain network (Tian 2017). Smart contract
governance and process rules in a blockchain-based supply chain can manage actor
certification and approval and what processes they are allowed to access and are
needed for execution. Actor data changes can occur depend- ing on supply chain
type, position, and trigger defined by a smart contract. The actors cannot change
the rules without some form of consensus process (Maurer 2017). Another example of
smart contract applications is in procurement. A smart con- tract between two
trading partners can legally update the automated record of what goods were bought,
sold, and delivered in real-time by end users across the line of business.
International Journal of Production Research 5 Figure 2. Supply chain
transformation. Smart contract process characteristics portend potential business
process continuous improvement for supply chain processes. The potential for supply
chain business process improvements can be situated in blockchain information that
may capture performance metrics in ledgers; linking them to agree upon processes.
This type of approach and information has great potential for supply chain design
and real-time implications, beyond just product delivery and governance concerns.
Blockchain impacts both supply chain process and product management, and financial
transactions between different network parties (Hofmann, Strewe, and Bosia 2018). A
key potential blockchain supply chain advantage is the disinterme- diation of
financial intermediaries, including payment networks, stock exchanges, and money
transfer services (Tapscott and Tapscott 2017). This will make trading processes
among partners more efficient. Inefficiencies in supply chain finan- cial flows can
be reduced through supply chain finance instruments and techniques such as reverse
factoring and dynamic 6 S. Saberi et al. discounting (Seifert and Seifert 2011;
Popa 2013); saving networks millions of dollars (Fanning and Centers 2016). Smart
contracts are capable of organising financial arrangements and would ensure that
sufficient funds are available to the projects and that everyone is paid in a
timely manner (Hofmann, Strewe, and Bosia 2017). They provide a connection for
transaction between different currencies or mix them from multiple sources in
global supply chain in a secure and timely manner (Eyal 2017). Although a broad
variety of blockchain technology applications in the supply chain can exist, they
are industry, product or service, or governance focused. To exemplify a practical
blockchain supply chain application we turn our discussion to sustainable supply
chains. Momentum is building towards sustainability solutions. Regulatory, consumer
and community pressure on businesses and their supply chains to improve the
sustainability of their supply chains and their products (Zhu, Sarkis, and Lai
2018). These facts prompt us to identify future supply chain implications in more
detail by considering the effect of blockchain technology on sustainable supply
chains. 4. Blockchain and sustainable supply chains Blockchains as distributed,
immutable, transparent, and trustworthy databases, shared by a community, can also
influence sustainable supply chain networks. Tracking potential social and
environmental conditions that might pose environ- mental, health and safety
concerns is an important application focus for the blockchain (Adams, Kewell, and
Parry 2018). Practical examples exist. Blockchains formed in China for carbon asset
markets allows enterprises to gener- ate carbon assets more efficiently in
accordance with China’s Carbon Emissions Reduction for the Paris Agreement3. A
blockchain-based supply chain provides better assurance of human rights and fair
work practices. For instance, a transparent record of product history assures
buyers that goods being purchased are supplied and manufactured from sources that
have been verified as being ethically sound. Smart contracts may be especially
capable for rules of tracking and controlling sustainable terms and regulatory
policy autonomously and enforcing or governing appropriate corrections. Sustainable
supply chains have gained significant interest amongst academics and practitioners
(Fahimnia, Sarkis, and Davarzani 2015). Not only are business dimensions of the
supply chain important for sustainable supply chains, but expand- ing the focus to
environmental and social dimensions has made for a more generalisable and holistic
perspective on the supply chain. The promising features of blockchain technology
might be a panacea for such complexity in the triple-bottom- line of
sustainability: economic, social, and environmental bottom lines. Thus, capturing
and identifying sustainable supply chain examples can exemplify the breadth of
blockchain technology application. Blockchain technology can support data
collection, storage, and management, supporting significant product and supply
chain information. Openness, transparency, neutrality, reliability, and security
for all supply chain agents and stakeholders can exist in this technological
context (Abeyratne and Monfared 2016). The food and beverage industry faces supply
chain sustainability pressures. An interesting application in this context is the
nexus of Radio Frequency Identification (RFID) and blockchain technology to equip a
food supply chain with traceability system for real-time food tracing based on
Hazard Analysis and Critical Control Points (HACCP) rules (Tian 2017). It can
record supply chain events in the agricultural sector (Staples et al. 2017).
Blockchain can aid supply chains to detect unethical suppliers and counterfeit
products since all the information can only be recorded by authorised actors; these
can cause serious social harm. Economically, adopting blockchain technology can
benefit a firm and its supply chain from different business dimen- sions affecting
their economic performance. We provide some examples, out of many for making the
economic business case for blockchain technology in the supply chain. Blockchains
can result in supply chain disintermediation where fewer tiers result in
transaction costs and time reduction, reducing business waste in the supply chain
(Ward 2017). Blockchain technology can share instantly every modification of the
data, allowing for potentially rapid deployment of products and processes while
minimising human errors and transaction times. Blockchain technology can ensure the
safety and authenticity of the data, which will reduce the cost of preventing data
from deliberate and capricious alteration increasing supply chain risks and
reducing business reliability (Ivanov, Dolgui, and Sokolov 2018). Besides,
customers and government now ask for transparency within supply chain. Pioneering
companies realised the competitive advan- tage of transparency (Ward 2017), which
results in increasing customers’ trust to purchase more and benefit the firm
financially. Blockchain technology has the potential to contribute to social supply
chain sustainability. Making information stable and immutable is one way of
building supply chain social sustainability. Given that information cannot be
modified without consent by authorised actors, blockchains can prevent corrupt
individuals, governments or organisations from seizing assets of people unfairly.
Also, blockchain technology can block nefarious agents and hold the corrupt
accountable for both social and individual misdeeds. Blockchain traceability helps
sustainability through better assurance of human rights, and fair, safe
International Journal of Production Research 7 work practices. For instance, a
clear record of product history helps buyer confidence that goods being purchased
are from ethical sources. Blockchain technology also aids in environmental supply
chain sustainability. It can do so from many different per- spective applications.
First, tracking substandard products accurately and identifying further
transactions of the products can help reduce the rework and recall, which helps
decrease resource consumption and reducing greenhouse gas emissions. Traditional
energy systems are centralised while a peer-to-peer network based on blockchain
technology for energy system can reduce the need to transmit electricity over long
distances and subsequently save a big portion of energy wasted over long distance
transmission. It would also reduce the need for energy storage which saves its
resources. There are several power platforms based on blockchain technology to
reduce the waste of the supply chain, such as Echchain, ElectricChain, and
Suncontract (futurethinkers 2017). Second, blockchains could be used to ensure that
purportedly green products are environmentally friendly. The process- ing
information for green products is often unavailable and difficult to verify. If the
manufacturing process of a product is verified to be green in terms of greenhouse
gas emissions level, environmentally conscious customers may be more willing to
purchase green products. For example, Ikea has a desk product made from wood cut in
a sustainable Indonesian forest. Ikea must follow the wood from the time it’s cut
through manufacturing to the final product to guarantee the desks really made from
this specific wood. This process is complex but can be managed with blockchain
technology. One such example is the Endorsement of the Forestry Certification
programme which traces the provenance of around 740 million acres of certified
forests all over the world using blockchain technology (Rosencrance 2017). Another
environmental supply chain sustainability example is related to carbon tax. In
traditional systems, the carbon footprint of each product is difficult to measure.
With blockchain technology, tracing the footprint of products of particular company
becomes easier. It can help determine the amount of carbon tax should be charged of
a company. If a product is more expensive with a large carbon footprint, the
customers may buy a product of low-carbon footprint. This additional information
and consumer or market pressure may cause firms to reevaluate and restructure their
supply chain to reduce the carbon emissions to meet the demand of buyers.
Blockchain technology can help reduce carbon emissions in the journey of products
by providing the fundamentals for supply chain mapping and applying low-carbon
product design, production, and transportations (de Sousa Jabbour et al. 2018a).
The Supply Chain Environmental Analysis Tool (SCEnAT) proposes a framework to
assess carbon emissions of each entity involved in supply chains and life-cycle of
products (Koh et al. 2013). SCEnAT 4.0 is a new tool that integrates novel
technologies such as blockchain, Internet of Things (IoT), Artificial Intelligence,
and Machine Learning to manage big data and link organisations in the supply chain
more effectively to support industry 4.0 policies, carbon reduction, and green
assessments4. Blockchain technology also has the potential to transform carbon
assets trading. As an example, IBM and Energy Blockchain Labs Inc. in China are
developing a green assets blockchain-based platform that helps organisations to
track and measure their carbon footprint, meet the Carbon Emission Reduction (CER)
quotas, and facilitate carbon asset development and trading. Transparent, secure
and real-time information on the blockchain gives organisations the opportunity to
cooperate and trade their carbon assets in a more efficient way in the green assets
markets5. Third, blockchain can improve the recycling. People and organisations may
not be motivated to participate in recy- cling programmes. Blockchain technology
has been used to motivate people in Northern Europe through financial rewards in
the form of cryptographic tokens in
exchange for depositing recyclables like plastic containers, cans, or bottles.
Meanwhile, it is difficult to track and compare the impact of various recycling
programmes. Blockchain makes it pos- sible to track data for evaluating the impact
of various programmes. For example, Social Plastic is a project based on blockchain
technology to turn plastic into money and aims to reduce the plastic waste.
RecycleToCoin is another blockchain application that enables people to return
plastic containers (futurethinkers 2017). The possibilities for this type of effort
for closed-loop supply chains make blockchain amenable to emerging concepts such as
the circular economy. Fourth, blockchain benefits the emission trading process by
improve emission trading schemes (ETS) efficacy. With the application of blockchain
technology, fraud can be avoided due to the fidelity and transparency of
blockchain. Thus, a reputation-based system is created which solves the
inefficiency of ETS and it encourages all the participant to figure out a long-term
solution to the emission reduction, because the participants are encouraged by the
economic benefits of good reputation (Khaqqi et al. 2018). The use of Blockchain
technology as a supply chain governance and information management mechanism will
be challenging specially in a sustainable network. Disruptive technologies
typically face challenges, whether in the short-term or long-term (Mendling et al.
2017). Therefore, participants of supply chain need to be prepared for it to have
it as an opportunity, rather than a threat, as it might challenge the relationships
through supply chain. These examples show the potential for economic, social, and
environmental (sustainability) influences that can be managed in a blockchain-
enabled supply chain.
Supply chain management is the backbone of any industrial sector. Different
industrial organizations, distributed globally and specialized in manufacturing of
particular types of products are operated as production houses for particular
segments, which would be required by another manufacturer to produce another
product or part of final product. Before reaching the final product, individual
parts of the product go through series of supply chains called multi-tier supply
chain. Aviation industry represent perfect example of how complex this process can
be and how all this process works. - 1051 - 28TH DAAAM INTERNATIONAL SYMPOSIUM ON
INTELLIGENT MANUFACTURING AND AUTOMATION Individual parts or aircraft body segments
are imported, a proper inventory is maintained and then assembled domestically.
Aircraft may overhaul to another region depending on type of service required.
These supply chains are well regulated and properly monitored by individual
companies at their individual levels. There is a possible risk of parts or segments
replacement, bad quality replication, and decommissioned or preceding products
being sold in black markets. There is no single supply chain of product
manufacturing but a web on interdependent manufacturers, heavily depended on each
other for segment production. There are certain pre requisites that should satisfy
specific requirements before moving forward in this chain that would make product
worth and efficient for future use. In most cases, when specific requirements are
not met, they are either returned or remanufactured, further increasing the delay
in obtaining the final products. Traditional SCM models and approaches are useful
when the amount of data to be processed is relatively small and the complexity of
the problem is low. But what about larger problems with a lot more data, like in
case of the aircraft's spare parts business? This challenge requires new data-
driven techniques such as Big Data and Blockchain. This emerging technologies will
push us into the next era of SCM design and Industrial Internet of Things (IIoT)
applications. In this paper we take industrial scenario for aviation’s supply chain
management, on which, we implement the concept of Blockchain technology where each
transactions is monitored by individual tiers of this supply chain, later smart
contracts platform between individual tiers can monitor quality and proper flow of
products in this chain. Individual databases at individual level will record and
update all transactions that would be flowing along different tiers. This concept
and technology into supply chain management can really bring significant added
value to business process through more easy flow, higher reliability and better
quality in aircrafts parts or segments. The remainder of this paper is organized as
follows. First we discuss the exploitation of SCM at different levels of OEMs
(Original Equipment Manufacturers), MRO (Maintenance, Repair and Overhaul)
businesses in aviation industry. Then we discuss a related and important area – the
protection of supply chains from counterfeiting, followed by an idea of Blockchain
integration in a tier to develop and model a transparent and reliable chain.
Section 5 discusses approaches to apply Blockchain to the SCM in industry as well
as its application in aviation. Section 6 continues and focuses this discussion on
Blockchain applications in aircraft’s parts business. Finally, in Section 7 we
discuss methodological issues in Blockchain, especially in the context of smart
supply chain management. We will talk about supply chain, its features and how
problems in future can be overcome. 2. Challenges in Smart Supply Chain Management
Protecting legitimate supply chains from counterfeiting has become a significant
challenge. In 1998, the OECD's report on the Economic Impact of Counterfeiting [1]
showed that counterfeit products were often made by the same manufacturer that was
contracted to produce the authentic product. The counterfeiting strategies are
increasingly sophisticated as in many cases counterfeiters apply the same
technologies and use the same suppliers as legitimate brands [2]. Thus, a variety
of counterfeiting strategies has emerged and affects the legitimate supply chain
such as genuine parts or products are stolen from the legitimate supply chain
(e.g.: disposed-of genuine products are recovered), factory over- runs or near
copies are illegally produced by sub-contractors, counterfeit products and genuine
products are bundled and distributed together. Over the past years many industrial
sectors have been reporting cases of infiltration of counterfeit products into
their supply chains. For instance, the aviation sector has been expressing strong
concerns about the detection of counterfeit aircraft ‘s parts in the legitimate
supply chain. Such detections have been reported both in the civil and military
aircraft supply chains in the US as well as in Europe. Several factors contribute
to this phenomenon. First, global supply chains constitute a complex and large
network of actors involved in production and distribution processes. In such
circumstances, many companies find it difficult to map and monitor their suppliers
and sub-suppliers beyond the second tier of their supply chains. This limited
visibility results in lower control over the supply chain and thereby increased
exposure to a variety of risks such as counterfeiting. In some cases, these
vulnerabilities allow illicit networks to penetrate legitimate supply chains and
exploit the services provided by supply chain intermediaries. Therefore, it becomes
urgent to take the necessary measures such as smart SCM techniques to better
protect legitimate supply chains from counterfeiting threats, including by
enhancing cooperation between supply chain actors, improving information exchange
and security, and actively promoting transparency and best practices in SCM. The
smart SCM vision relies on extensive use of sensors to monitor the supply chain
status and ICT to adapt activities and operations of the supply chain to meet its
objectives. Realization of the smart SCM vision requires solution of many technical
challenges. To serve target customers better than their competitors, supply chain
management (SCM) teams today look into new technologies such as Big Data, Internet
of Things (IoT) and Blockchain. These new technologies allow managers to develop
and provide complex supply chain services and products faster with improved
reliabilities. With these technologies, SCM teams can build complex models of a
supply chain or systems of supply chains using a data-driven approach. Blockchain
is a paradigm that involves dynamically incorporating real-time transactions into
chains of blocks in order to steer the information exchange process of an
application system. Information on a Blockchain exists as a shared database which
isn’t stored in any single location, meaning the records it keeps are truly public
and easily verifiable. No - 1052 - 28TH DAAAM INTERNATIONAL SYMPOSIUM ON
INTELLIGENT MANUFACTURING AND AUTOMATION centralized version of this database
exists for a hacker to corrupt. Hosted by millions of computers simultaneously, its
data is accessible to anyone on the internet. The Blockchain network automatically
checks in with itself every ten minutes. A kind of self-auditing ecosystem of a
digital value, the network reconciles every transaction that happens in ten-minute
intervals. Each group of these transactions is referred to as a “block”. Two
important properties result from this: • Transparency: data is embedded within the
network as a whole, by definition it is public. • It cannot be corrupted: altering
any unit of information on the Blockchain would mean using a huge amount of
computing power to override the entire network. In theory, this could be possible.
In practice, it’s unlikely to happen. Taking control of the system to capture
Bitcoins, for instance, would also have the effect of destroying their value.
Blockchain technology initially was introduced in cryptocurrency where because of
decentralized ledger, it was easy to record all the financial transaction among all
the actors simultaneously avoiding any kind of error. However, following to Don and
Alex Tapscott: “The blockchain is an incorruptible digital ledger of economic
transactions that can be programmed to record not just financial transactions but
virtually everything of value.” [3] The Blockchain concept of other domains has
been lately proposed but yet to be implemented. In aviation industry there is
increasing demand of aircraft, and logistics or supply chains play important role
in support of the aviation industry. Introduction of the Blockchain technology into
SCM practice of aviation industry will enhance the aviation industries’ performance
and increase the passengers’ safety. It is immediately apparent that the Blockchain
paradigm is directly applicable to realizing smart supply chains. For example,
Blockchain provides an approach to address issues such as creating more efficient
and reliable supply chains and to mitigate counterfeiting. This paper discusses the
applicability of this paradigm to create more resilient and sustainable supply
chains in aviation industry. 3. Supply Chain in Aviation By 2035, there will be a
significant growth of passengers’ traffic and consequential demand in aircraft, as
a result, significant increase in aircraft production is expected [4]. This growth
will seek huge demand for more flight carriers, therefore the supply chain should
proceed in perfect sequence, without any error. Soaring demands also lead to
pressure on the supply chain causing delay and failure. Example, the problem to
unhandled this situation could be at any level where the supplier is not able to
process demands due to unavailability of products at preceding level
[5]. In this environment of supply chain, individual level competes instead of co-
operating by not sharing the information. This leads to error as we proceed up the
supply chain [6]. Behind every final product, there is a long chain or levels of
assemblies, but some researches have combined these individual levels, which
produce for OEMs into 3 main tiers supplies [7]: • Tier 1: This level directly
works for OEMs, for example, dealing with engines, brakes, etc. they are first
suppliers to the assemblers. • Tier 2: They are the suppliers to tier 1, they
supply products, which are manufacture from their own productions. Example,
assembling individual parts of Engine. • Tier 3: These are individual small-scale
component production companies, which usually provide small components like
electrical components, raw material. Figure 1 below is a sample tier representation
of Aviation Turbine Company, though this company would be serving at some tier for
another “Originating Buyers” i.e. each component of any supply chain at any tier
would have its own tier of supplies. Fig. 1. The aircraft’s Turbine’s Supply Chain
- 1053 - 28TH DAAAM INTERNATIONAL SYMPOSIUM ON INTELLIGENT MANUFACTURING AND
AUTOMATION Even after the proper path of supply chain, the risk and challenges like
careful coordination among different bodies, challenges of managing the risk across
global network and complex supply network, risks like guarantee, functioning,
quality control, usage control, etc. still exist in OMEs. Necessity by the
organizations to understand not just the direct suppliers they buy from, but also
those who indirectly contribute component or service across the extended supply
chain
In recent years, a proliferation of research, projects, and discussions regarding
distributed ledger technology (DLT) has increasingly attracted the attention of
researchers and practitioners. The reason lies in the characteristics that DLT may
deliver promising disruption to the current model of trust, which has long created
operational pain points of cen- tralized systems. Traditional business operations
rely heavily on a centralized authority or third parties, such as banks, to promote
trust among participants [1], [2]. However, they have often been the targets of
malicious attacks, malfunction and artificial alterations. The emergence of
blockchain tech- nology may bring about a rethinking of the design of busi- ness
operations by virtue of its distributed and decentralized characteristics [3]. The
associate editor coordinating the review of this manuscript and approving it for
publication was Xiang Zhao . Blockchain, a DLT, refers to a consecutive list of
time- stamped records (usually digital transaction data) sequen- tially linked
using cryptography. A peer-to-peer network of participating nodes contribute to the
formation and validation of blockchain and manages distributed consensus by network
majority. This makes blockchain an immutable, secure, and trustless model where
transactions among parties are con- cerned. Blockchain technology has the potential
to rebuild the way businesses conduct their operations [1], [4]. Sev- eral use
cases have been investigated using the concept of blockchain, which could function
as a distributed database without third parties. Several research endeavors
regarding trade finance [5], medical record management [6], voting [7], and
insurance industries [8] have improved the visibility of blockchain. Supply chain
management (SCM) is one of these potential applications [9]–[13]. Growing efforts
have been devoted to the study of blockchain technology and its applications across
various 62478 This work is licensed under a Creative Commons Attribution 4.0
License. For more information, see https://creativecommons.org/licenses/by/4.0/
VOLUME 8, 2020 S. E. Chang, Y. Chen: When Blockchain Meets Supply Chain: Systematic
Literature Review on Current Development sectors [9]. The scope of this research
ranges from techni- cal discussion [14], [15], application feasibility [16], busi-
ness operations [4], to even legal issues [17] and user acceptance [18]. Gathering
information from 106 articles, including journal and conference papers published in
a variety of sources during the period 2016 to early 2020, this study presents
illustrative topics related to blockchain evolution in the recent decade. The major
research meth- ods adopted in these studies have also been reported to outline the
relationship between the main topics and methodologies. Among extant literature,
research regarding the appli- cation of blockchain technology in supply chains is
rather fragmented and diverse in topics [19], [20]. This phenomenon indicates a
promising research interest but less-organized comprehension among the literature
distribu- tion. While researchers presented their early efforts regarding
blockchain-based supply chain literature, there was a lack of qualified peer-
reviewed articles that could be aggregated and analyzed in the current research’s
limited time frame. In [19], the first blockchain-related supply chain literature
survey was conducted prior to January 2018 under scientific rigor with a peer-
reviewed process. The authors also collected several blockchain trial pilots to
demonstrate their contributions, and suggested second-round surveys to capture the
rapid development of blockchain technology in the realm of SCM. Similarly, another
study in the same-period [20] highlighted examples of blockchain-SCM integration
while reporting the scarcity of related studies in leading journals and databases.
In this study, the researchers highlighted the early adoption of blockchain in the
electric power industry with a rela- tively mature understanding of blockchain-SCM
integration. Both these papers reviewed only a few studies before 2018, i.e., 29
and 27 papers, respectively. These initial literature reviews are not adequate for
providing a general overview, and a literature update is required due to the rapid
prolifer- ation of blockchain-based supply chain research from year 2018 to early
2020. Unlike the aforementioned review arti- cles, this current work aims to
provide a more holistic analysis of scenarios of blockchain use in supply chains by
supple- menting academic research for the past two years. Since blockchain with its
unique features allows more streamlined business processes [21], [22], and enhanced
transparency and trust among stakeholders, exploring its applications in supply
chains is important for both academics and practitioners. We also realize the need
for reporting the current status and potential of blockchain and its emerging
applications across different industries in the SCM context. In this regard, we
pro- posed certain questions to develop the logical connection between relevant
extant articles and the potential for further research. The research questions in
this study are as follows: RQ1: What are the main topics and subjects of interest
in supply chain studies that utilize blockchain technology; how do they address its
core issues; and how have these topics evolved over time? RQ2: What are the main
research methodologies employed in blockchain-based supply chain literature and how
are they related to the main topics? RQ3: Which blockchain-supply-chain papers were
most instrumental in driving the development of literature thus far? To answer
these questions, we adopted a systematic litera- ture review (SLR) to gain insights
regarding correlated issues. The aim of using SLR was to present a general overview
of recent research by conducting a systematic analysis of extant literature. Thus,
we outline the understanding regarding the research path based on our comprehension
of related research interests and topic distributions. This paper contributes to
the understanding of blockchain applications in the field of SCM by exploring
various research topics and directions for future research. The literature analysis
highlighted several potential research areas that may point out certain research
gaps for future study. The remainder of this paper is organized as follows. Section
II describes the basic knowledge regard- ing blockchain and smart contracts.
Section III presents the methodology and procedural steps utilized in this review
and Section IV reports findings from the analysis of literature. Section V
identifies the main research issues, challenges, and implications, before the final
conclusion is presented in Section VI. II. PRELIMINARIES A. BLOCKCHAIN Nakamoto
[23] proposed the concept of a decentralized dig- ital currency, Bitcoin, supported
by a decentralized payment system. Decentralization refers to an operating
mechanism that allows peer-to-peer (P2P) exchange or transactions with- out
centralized authorities. This disruptive innovation elimi- nates the heavy reliance
on powerful third parties. Blockchain is the technology underpinning the Bitcoin
cryptocurrency, which is a consecutive growing list of blocks, wherein each block
records encrypted transactional data and may have further potential for other
decentralization purposes [24]. The operating nodes in this kind of collaborative
network have a duplicate record of transactional information, known as a
‘‘ledger.’’ Inherently shared by participating nodes, DLT pro- vides the
opportunities for a trustless operating environment without traditional trusted
authorities such as banks and clear- ing houses. P2P exchange facilitates trust
building among participating nodes and the shared ledger is maintained by nodes in
the network. Computer nodes comply with an encrypted protocol to verify updated
data in the shared ledger. This kind of dis- tributed ledger system harvests the
benefits of decentralized governance which may solve the issue of information expo-
sure and accountability [25]. This inherent attribute favors the interactions
between counterparties in the context of business operations [26]. Critical
information could be maintained without checking the consistency of individual data
and every single node possesses a duplicate of transactional data, VOLUME 8, 2020
62479 S. E. Chang, Y. Chen: When Blockchain Meets Supply Chain: Systematic
Literature Review on Current Development thereby enhancing the transparency and
visibility of business activities. In a supply chain context, this kind of system
and opera- tional scheme may provide a better foundation of trust as well as
benefits resulting from the absence of a centralized author- ity and intermediation
[12]. Accordingly, blockchain could further be utilized to record the ownership of
assets [27], permissions, and activity logs. This improves the traceability of
information, cash, and process flows, and thus provides timely tracking of products
and services. The different types of blockchain are public, private, and consortium
(or feder- ated) blockchains, each of which could be applied in certain scenarios
to gain better advantages and for effectiveness. B. SMART CONTRACTS Smart contracts
are programmable protocols that allow the execution of contract terms and
agreements. The concept was first proposed by Szabo [28], who defined a smart
contract as ‘‘a computerized transaction protocol that executes the terms of a
contract.’’ Thus, smart contracts can be deployed to a blockchain database and
users can develop computer codes based on contractual clauses [29]. Contracts are
executed when certain preset conditions are met. Smart contracts may outperform
traditional contracts due to advantages such as allowing the mitigation of
intermediaries among transacting
counterparties and the facilitation of transaction flows with- out malicious
alterations and tampering [30]. Smart contracts can be deployed on blockchain
platforms in terms of scripts and stored with specific addresses for functional
calls similar to those performed in other programmable computer lan- guages [31].
They may facilitate data-driven interactions in the blockchain network and further
allow applications to meet supply chain objectives. Smart contracts are essential
in the use of blockchain applications. A potential use case for smart contracts is
in SCM. For example, a comprehensive paper-based process of administrative auditing
may hinder the overall performance of a supply chain. Regulated conditions and
agreements can be coded in smart contracts to avoid fraud, theft or other
managerial risks. When smart contracts are deployed in the blockchain network, they
are transferred to each connected node. Latest changes recorded in the local
database may in turn trigger the conditions prescribed in computer codes to execute
related process flows or notifications [32]. This is referred to as an event-driven
mechanism, which can be facil- itated without interference from a single entity.
Typical use cases include conditioned payment transactions [33], [34], and asset
and proprietary transfers [35]. With data updates and an event-driven mechanism,
smart contracts may facilitate the manipulation of supply chain activities [36].
For example, commercial pilots, such as IBM and Maersk, recently announced their
successful adoption of blockchain technology and smart contracts for shipment
tracking and facilitating trade finance. Traditional paper- based procedures
dealing with the collection and presentation of commercial documents could be
significantly mitigated with the use of smart contracts [37]. This technology can
reduce transaction costs and the number of involved inter- mediaries, and improve
trade efficiency to achieve process automation. Smart contracts on a blockchain-
based platform can have applications in various fields; however, previous studies
have reported certain unresolved issues with respect to technical and legal
concerns [38]. For example, contract vul- nerabilities with regard to transaction-
ordering and times- tamp dependence, mishandled exceptions, re-entrance, and
callstack issues [39]. To pursue a wider spectrum of appli- cations, more research
endeavors must focus on solving validation/verification issues [40], enhancing
security and privacy, and contract-based integration with other technolo- gies
[41]–[43]. Smart contracts may facilitate obligation execution and process
automation among parties based on technical openness, however, its long-term
development still requires a cross-disciplinary approach, combining technolog-
ical, economic, and legitimation practices.
The manufacturing of goods is becoming complex due to the in- creased number of
intermediaries between the producer and the final consumer. Globalization and
market expansion pushed companies to expand their products portfolios and life
cycle, to meet new markets requirements. Hence, there’s little knowledge of the
product origins, processing or shipping journey (Van Kralingen, 2016). The
challenge becomes not only quantitative but also qualitative. The main challenge of
the supply chain remains in the traceability and data management system. The
management of Information system in most sectors notably in healthcare, financial,
food, and education is centralized. Transac- tions, decision-making, and storage
system are controlled by third-party intermediaries. However, a centralized
management system could re- present a threat to data integrity, availability, and
resiliency, leaving the system subject to corruption fraud and tampering (Abeyratne
& Monfared, 2016). A trusted ecosystem needs to be created between the suppliers
and their customers. This is achieved by a policy that focuses on the transparency
of the chain to ensure product traceability, where accurate data collection and
secure data storage are required. Blockchain has been introduced in supply chain
areas to make the chain more transparent, authentic and trustworthy (Laaper,
Fitzgerald, Quasney, Yeh, & Basir, 2017). The purpose of this work is to study how
integrating the blockchain into the supply chain can create a more re- liable and
authentic ecosystem. Blockchain provides an untampered/ unalterable record of
transac- tions. All product and shipping details are collected through different
technologies and validated before becoming a permanent record on the blockchain
(Ramamurthy, 2016; Zyskind, Nathan, & Pentland, 2015). To achieve our main
objective, we provide first a literature review of the actual supply chain
challenges before introducing the blockchain as a solution. The literature points
out to new blockchain-based supply chain challenges. Hence studying blockchain
integration into supply chain consists of evaluating blockchain-base supply chain
efficiency and suffi- ciency. Next, we present the method adopted in this paper.
Then we de- scribe Ambrosus and Modum platforms, two real cases, introduced to add
value to our evaluation and build our theory. Finally, we conclude with our
recommendation to build a blockchain-based supply chain.
https://doi.org/10.1016/j.cie.2019.06.042 Received 29 August 2018; Received in
revised form 6 May 2019; Accepted 17 June 2019 List of Acronyms: API, Application
programming interface; BLE, Bluetooth Low Energy; CCD, Charge-coupled device; ERP,
Enterprise resource planning; EVM, Ethereum virtual machine; FDA, Food & drug
administration; GDP, Good distribution practice; GPRS, General Packet Radio
Service; GPS, Global Positioning System; HTTP, HyperText Transfer Protocol; IoT,
Internet of things; IPFS, InterPlanetary File System; JSON, JavaScript Object
Notation; M2M, Machine to machine; NFC, Near-field communication; NMBA, N-
Methylnitrosobutyric acid; PBFT, Practical Byzantine Fault Tolerance; QR code,
Quick Response Code; REST, Representational State Transfer; RFID, Radio-frequency
identification; 3G, Third generation; URL, Uniform Resource Locator ⁎ Corresponding
author. E-mail addresses: [email protected] (R. Azzi),
[email protected] (R.K. Chamoun), [email protected] (M. Sokhn). Computers
& Industrial Engineering 135 (2019) 582–592 Available online 18 June 2019 0360-
8352/ © 2019 Elsevier Ltd. All rights reserved. T 2. Literature review 2.1.
Background A supply chain ecosystem describes the processes that involve de-
signing, engineering, manufacturing, and distributing products or ser- vices from
suppliers to end-consumers (Muckstadt, Murray, Rappold, & Collins, 2001). Because
these processes affect the goods, information and financial flows, some regulations
are set to protect the consumers’ right (Viswanadham & Samvedi, 2013). The eight
basic consumer’s rights recognized by the United Nations involve the right to
safety, the right to be informed, the right to redress and the right to a healthy
environment (Your rights as a consumer). In the United States, the Food and Drug
Administration (FDA) maintains consumers’ right by promoting and protecting public
health, through goods control and supervision. It works on applying predefined
regulation and by protecting and promoting the development of human and veterinary
drugs, biological products, medical devices and radia- tion-emitting products,
human and animal food, and cosmetics (Food & Drug Administration, 2018). Many
incidents have occurred in the past years, ultimately putting to question the
supply chain reliability and its product data accuracy. In March 2018, 210 persons
in the USA got an E. coli infection. Three months later, the public health and
regulatory officials traced the origin of this infection to romaine lettuce which
had been contaminated through the water back in the Yuma growing region (E. coli
O157:H7 Infections Linked to Romaine Lettuce, 2018). In Jan- uary 2008, Baxter
Healthcare Corporation recalled various lots of he- parin, an anticoagulant
medication, after associating the product with adverse events, including deaths
(Guerrini et al., 2008). More than three months later, U.S. FDA was able to
establish a link between a contaminant found in heparin, a highly sulfated
chondroitin sulfate, and the serious adverse events seen in patients given heparin.
They traced back the contaminant to 12 different Chinese companies, and they found
heparin batches shipped to 11 countries (Information on Heparin, 2018). The Table
below (see Table 1) provides information gathered from latest Food and Drug product
recalls published on the FDA websites (Recalls, Market Withdrawals, Safety Alerts,
2019). Based on the collected information, we highlight the multiple breaches
encountered daily on a supply chain (Abeyratne & Monfared, 2016; Kshetri, 2018).
Not only is people’s health affected, but busi- nesses also undergo damage. The
company with a recalled product will suffer a reputation loss due to negative
publicity and will see it sales reduced dramatically (Kshetri, 2018). During the
investigation period, all related product will be affected, and some businesses
shut down until the origin of this supply chain breach is detected (Kshetri, 2018).
Between the market expansion, the growth in suppliers’ relationships, and the
rising consumer demand, the supply chain complexity has in- creased and revealed
the need to meet new challenges. The key ob- jectives of the supply chain,
including cost, quality, speed, depend- ability, risk reduction, sustainability,
and flexibility, are not fully achieved (Kshetri, 2018). Transparency and
traceability need to be enhanced in manu- facturing supply chains (Abeyratne &
Monfared, 2016; Caro, Ali, Vecchio, & Giaffreda, 2018; Laaper et al., 2017; Tian,
2016, 2017). The main supply chain risk lies in the product journey. We need more
knowledge about the product, its origin, processing and shipping journey (Abeyratne
& Monfared, 2016). Consumers are unable to verify the integrity of the acquired
product; they have to trust the certification logo printed on products. Verifying
this certification integrity requires strenuous auditing. Transparency must be
enabled not only to regain the consumer’s trust but to help the producer get a
better perspective of the supply chain breaches and understand how management
product decisions and environmental circumstances can affect a product. Achieving
transparency requires accurate data collection and secure data storage, a difficult
task currently entrusted to third parties through Table 1 Food and drugs supply
chain breaches reported by the U.S. FDA (Recalls et al., 2019). Date Brand Product
description Reason/problem Food supply chain breach 03/08/2019 Fullei Fresh Organic
bean sprouts Listeria monocytogenes 02/25/2019 Marketside Green beans and butternut
squash Potential Literia monocytogenes contamination 02/25/2019 Bachman Twist
pretzels Undeclared milk 02/22/2019 Nova salted biscuit Nova salted biscuit
Undeclared milk Drugs supply chain breach 03/05/2019 Life-line tm Additive for
human drinking water Potentially contaminated with Pseudomonas aeruginosa
03/04/2019 Apotex Corp. Drospirenone and ethinyl estradiol tablets, USP May contain
defective blisters 03/01/2019 Sunstone organics White Vein Kratom and Maeng Da
Kratom Potential for Salmonella 03/01/2019 Torrent pharma Losartan potassium
tablets USP and Losartan Potassium/hydrochlorothiazide tablets USP Contains N-
Methylnitrosobutyric acid (NMBA) R. Azzi, et al. Computers & Industrial Engineering
135 (2019) 582–592 583 centralized information depositories (Abeyratne & Monfared,
2016). As revealed by Stoshi Nakamoto (Nakamoto, 2008); blockchain technology
emerged in 2008 to serve as the shared ledger of the cryptocurrency Bitcoin. Unlike
traditional currencies, Bitcoin elimi- nated the need for intermediaries and
provided an efficient way to re- cord transactions’ information (Gupta, 2018).
Blockchain brought to financial services: security, immutability, transparency and
the ability to excise the middleman (Underwood, 2016). Used to record any
transaction and to track the movement of any asset, blockchain re- volutionized the
traditional business network. Many sectors, notably in healthcare, insurance,
government, supply chain management, and Internet of things, are likely to be
transformed by the blockchain (Kshetri, 2018). 2.2. What is a blockchain? A
blockchain is a distributed ledger that records and shares all transactions that
occur within the blockchain network. The blockchain network consists of multiple
nodes that maintain a set of shared state and perform transactions modifying the
states (Anh, 2017).
Transac- tions must be validated by the majority of network nodes, before being
ordered and packaged into a timestamped block. This mining process depends on the
consensus mechanism adopted by the blockchain net- work (Christidis &
Devetsikiotis, 2016). Before adding the new sug- gested block to the chain, all
networks’ nodes verify that the block contains valid transactions and references
the correct previous block via a cryptographic pointer. The blockchain network can
be categorized either as permission-less or as permissioned network. A permission-
less blockchain, is an open distributed ledger where any node can join the network
and where any two peers can conduct transactions without any authentication from
the central agency (Sankar, Sindhu, & Sethumadhavan, 2017). A permis- sioned
blockchain is a controlled distributed ledger, where the decision making, and the
validation process are kept to one organization (Sankar et al., 2017). A
Certificate Authority determines who can join the net- work. All nodes are
authenticated, and their identity is known to other nodes (Anh, 2017). Fig. 1 below
shows the blockchain data structure. The first block is known as the genesis block.
A block consists of a header and a body. The block body contains the list of
transactions (Di Pierro, 2017). The number of transactions within a block is
related to the block and transaction’s size. The block header contains various
fields, mainly the block version indicating the set of rules which should be
followed for validation (Zheng, Xie, Dai, & Wang, 2016), a hash of the previous
block header, a timestamp, the Merkle tree root hash that represents the hash value
of all the transactions in the block (Zheng et al., 2016). The nonce and target are
block header fields, used for the Proof-of-Work protocol. It’s a computational
process, known as mining, where miners are the nodes that calculate the block
header hash. A block is accepted by all nodes if a miner finds a nonce such as:
hash (block header) < difficulty target. The nonce is a 32-bit field that is
incremented until the equation is solved (Zheng et al., 2016). Apart from being a
distributed shared ledger, blockchain is also defined by three key concepts:
consensus, smart contract and crypto- graphy (Gupta, 2018; Anh, 2017). 1. A
consensus is an agreement that helps a decentralized network to authenticate and
validate a value or a transaction. It ensures that all network nodes share the same
data and prevents malicious actors from manipulating the data (LFS171x). A
consensus mechanism is defined by the following parameters: integrity,
authentication, non- repudiation, byzantine fault tolerance, decentralized
governance, quorum structure and performance (Seibold & Samman, 2016). The type of
consensus protocol depends on the blockchain type. For example, Bitcoin, a public
ledger, uses Proof-of-Work, a computa- tional expensive mining protocol to work
around the Sybil attack, where a minority can control the whole network. In a
permissioned blockchain, one organization determines the consensus process. A node
needs to be certified to join the consensus process (Zheng et al., 2016). In that
case, Proof-of-Work is unnecessary and is an ex- pensive way to reach consensus
because all participants are au- thenticated. 2. Smart contracts are self-executing
scripts stored on the blockchain. When performing a transaction, smart contracts
are invoked to execute the term of a contract/procedure on every node in the
network (Christidis & Devetsikiotis, 2016). Hence, every node in a blockchain
network must agree on the inputs, outputs and states affected by the smart contract
(Anh, 2017). Satisfying common contractual conditions, such as payment terms or
confidentiality, minimizes the need for trusted intermediaries (Bocek & Stiller,
2018). 3. Cryptographic techniques are used to ensure integrity, authenticity,
immutability and nonrepudiation of the blockchain ledgers since even an
authenticated node can act maliciously (Christidis & Devetsikiotis, 2016). The
state root hash and the hash pointers are combined to secure and track all the
historical changes made to the global state (Anh, 2017). The purpose of the root
hash of the hash tree is to detect data tampering and to validate the transaction
ef- ficiently (Ramamurthy). To verify any transaction, we need to check the hash
tree path related to the requested transaction. Any mod- ification in a specific
transaction will be instantly detected (Anh, 2017). The purpose of the block header
hash is to verify the integrity of the block and of the transactions, and to form
the chain link by embedding the previous block hash in the current block header.
Transactions' block cannot be modified or deleted, once appended to the blockchain.
Any modification in a specific block will invalidate all subsequent blocks (Anh,
2017). The asymmetric cryptography is used to provide integrity, authentication and
nonrepudiation into the blockchain network. A user’s node must sign the transaction
before broadcasting it to the network (Christidis & Devetsikiotis, 2016; Anh, 2017;
Zheng et al., 2016). Each user generates a key pair. The private key is used to
encrypt the hash value derived from the transactions, and the public one is used by
a peer node to verify the transaction’s authenticity. Note that in a permissioned
block- chain, an access control layer is added. For example, in Hyperledger,
arbitrary policies are implemented to control users’ access to the blockchain, thus
adding more security to the network (Anh, 2017). 2.3. How blockchain improves the
supply chain management As already mentioned, there is a need to enhance the
transparency and the traceability in the manufacturing supply chain. It is achieved
by a policy that focuses on the transparency of the chain, where accurate data
collection and secure data storage are required. A good traceability system aims to
minimize the production and distribution of unsafe or bad quality products by
improving the labeling and tracking systems. The track and trace systems have
evolved from paperwork to Internet of things (IoT) hardware and sensors (Abad et
al., 2009; Aung & Chang, 2014; Badia-Melis, Mishra, & Ruiz-García, 2015; Van
Kralingen, 2016; Zou, Chen, Uysal, & Zheng, 2014). The principal components of a
tracking system are the tag, the tracer, and the sensor. A tag is a label set on
the top of a product or a package that identifies the product. Passive Radio-
frequency identification (RFID) and Quick Response Code (QR code) are examples of
tagging systems. A tracer is a substance introduced into a product or its natural
feature, used to provide information about the course or the process that involved
a product, thus certifying its quality. A sensor is a device that detects
environmental changes such as light, heat, motion, moisture, pressure, etc. The
detected events are then sent to other electronic devices over the network for
processing. However, tracking devices are sometimes compromised and subject to
cloning (Toyoda, Mathiopoulos, Ohtsuki, & Sasase, 2017). An R. Azzi, et al.
Computers & Industrial Engineering 135 (2019) 582–592 584 attacker can clone an
RFID tag attached to a genuine product. Cloned tags on counterfeit products can
mislead the consumers and endanger the consumers’ safety in a medical or food
industry (Huang et al., 2017). For producers, cloned tags can damage the company’s
reputa- tion and cause severe economic losses in the logistics industries. Re-
solving clone attacks issue is achieved either through a prevention strategy based
on developing either clone attack detection technique or a tag distribution schemes
in order to prevent an attacker from copying the tags’ content (Toyoda et al.,
2017). According to Toyoda et al. none of these proposed track and trace methods
can guarantee that the product, with an attached tag, is genuine once it is placed
in retails stores for sale; this is because these methods leverage the tag’s secret
information (Toyoda et al., 2017). A blockchain-based product own- ership
management system was proposed, to transfer and prove the uniqueness of an RFID
tag-attached products for the post supply chain. Counterfeits may be detected when
the seller cannot prove the pos- session of the claimed product. In supply chain
area, storage and logistics management is con- sidered a real challenge. Petri Helo
et al. discuss in their paper the limit of centralized enterprise resource planning
(ERP) technology in managing the supply chain and introduce a cloud-based solution
(Helo, Suorsa, Hao, & Anussornnitisarn, 2014). In fact, ERP is a transaction
management system that processes collected information and stores data in a single
database. But ERP could not adapt to supply chain evolution and requirements
especially in terms of transparency, flex- ibility, data accessibility and advanced
decision making. A cloud-based NetMES system has been proposed to solve this issue
(Helo et al., 2014). The cloud technology is used as a platform to exchange, store
and monitor information where a centralized virtual database replaces a centralized
physical database. It has added a real-time interaction to the whole proposed
system; however, the security and privacy of stored data remain an issue. (Helo et
al., 2014; Kshetri, 2017). Besides, in a centralized system, a single entity
controls data. If this entity fails or shuts down abruptly, the whole system will
crash and stop processing transactions (Tian, 2017). The system is subject to fraud
and malicious attack. It’s not the case with the distributed ledger where a hacker
cannot take advantage of a vulnerable point; if one node fails, the remaining nodes
will not be affected. Note that a centralized system allows any user to modify a
transaction in the ledger because there is no restriction on the operations (Nair &
Sebastian,
2017). In case the data administrator is bribed, the whole system could be subject
to tampering and falsifying information (Tian, 2017). In China, the agri-food loss
ratio is up to 30% yearly mainly due to their centralized logistic system (Tian,
2016). To reduce the losses during the logistics process and enhance food safety,
Feng Tian pro- posed a decentralized traceability system based on RFID and block-
chain. According to Feng Tian, enhancing the quality of the traceability system by
integrating the RFID with other technologies such as WSN, Global Positioning System
(GPS), etc. is not sufficient (Tian, 2016). These technologies cannot guarantee the
integrity of the collected and shared data with all supply chain members.
Integrated to improve the tracking system, blockchain strengthens trust, food
safety assurance and information credibility. The RFID executes the tracing and
mon- itoring to guarantee food quality and safety. All relevant information is then
uploaded on the blockchain to create a reliable, transparent and secure
decentralized platform, where all supply chain actors can in- teract (Tian, 2016).
In case of an accident, emergency measures could be immediately taken to prevent
the risk of hazard spreading. The proposed system has two disadvantages, first, the
high cost of the RFID tag, which pushes some companies to narrow the application
scope of the RFID, second, the immaturity of blockchain technology linked to the
storage and synchronization issues (Tian, 2016). According to Zheng Z. et al,
blockchain is not always sufficient for storing data (Zheng et al., 2016). With the
increasing number of Fig. 1. Blockchain structure. R. Azzi, et al. Computers &
Industrial Engineering 135 (2019) 582–592 585 transactions, the blockchain has
become heavy. Hence scalability be- comes challenging. For example, in a Bitcoin
network, the block size is limited to 1 MB, and a block is added every 10 min
(Zheng et al., 2016). Transaction’s rate is limited to seven transactions per
second, which is not enough for the trading system. Increasing the block size will
reduce the network efficiency. To overcome the blockchain scalability issue, Feng
Tian, propose to integrate BigchainDB into the supply chain ecosystem. As proposed
by McConaghy et al., BigchainDB combines the key benefits of distributed Databases
– high throughput, low latency and high capacity- with the key benefits of
blockchain – decentralization, immutability, creation and movement of digital
assets (Tian, 2017). Based on the above studies some questions have emerged: • What
are the benefits of introducing the blockchain to the supply chain? • Can we trust
the information shared in a supply chain traceability system? • What are the
challenges we need to address when integrating the blockchain in a supply chain? 3.
Methodology and case study To evaluate blockchain-based supply chain efficiency and
suffi- ciency to create a reliable, transparent, authentic and secure system, we
have adopted the theory built based on case studies as a research strategy. Working
on real cases will highlight the challenges and characteristics to be taken into
consideration in order to build an effi- cient blockchain-based supply chain. To
confirm the theoretical study, knowledge of the practical and real-world
application of the blockchain in a supply chain ecosystem is needed. By theoretical
study, we imply study not deployed on a large scale. According to Eisenhardt k.,
case studies emphasize the rich, real-world context in which the phenomena occur
(Eisenhard, 1989). Several startups have already identified the blockchain as a new
paradigm that aims to enhance supply chain management. We sum- marize, in Table 2,
the main goal of the most prominent supply chain implementations and compare them
according to the blockchain type and tracking system used. By introducing
blockchain into their supply chain, these startups aimed to track, record and
verify goods as well as protect them from fraud and tampering. As shown in the
Literature review, integrating the blockchain into the supply chain ecosystem
brought significant new challenges notably on the blockchain level. To build a
blockchain-based supply chain management, we need to take into consideration not
only the block- chain technology but also the reliability of collected data. To
study how startups, integrate the blockchain into their supply chain ecosystem, we
need to understand first their tracking system and the blockchain’s role in their
platforms’ architecture. The efficiency and sufficiency of their blockchain-based
supply chain will be developed in the discussion part. We selected Ambrosus and
Modum as real cases to study since we could obtain sufficient information and they
are related to the food and pharmaceutical supply chain: our main interest. By
combining the theoretical findings with those drawn from real cases, we are able to
address the emergent questions listed above. 4. Description of the selected cases
Ambrosus and Modum two Swiss Startups, have developed a system that merges IoT,
blockchain technology and real-time sensors to trace and transmit products’
information during the whole manufacturing process. They aim to optimize supply
chain visibility and quality assurance. Modum specializes in the pharmaceutical
supply chain to ensure the safe delivery of pharmaceutical drugs in compliance with
the GDP re- quirements. Ambrosus specializes in food and pharmaceutical supply
chain to ensure the quality and safety of product consumption. For each case, we
will describe the tracking system and the blockchain integra- tion into these
startups’ system.
Blockchain is a decentralized, distributed database that maintains a continuously
growing list of secure data records. It first emerged in the context of Bitcoin,
where it serves as a decentralized, distributed digital ledger recording all
Bitcoin transactions.[1] Bitcoin is a currency that is controlled by the network of
users instead of by centralized banks. Through the use of Bitcoin, money can be
transferred directly. In the traditional banking system, when money is transferred
through banks, they are notified to transfer the money; the bank(s) will send
notification and update accounts appropriately. The relevant data is stored in a
database owned by the bank (or in multiple databases owned by banks), and users
only have partial access to that data. Users must trust third parties. This has two
implications. First, the bank has to make a profit, so in the aggregate, this means
less for the other participants. In addition, if some third party or the bank
itself manipulates the data or commits fraud, it might be challenging for all
participants to quickly and efficiently detect this. On the other hand, the Bitcoin
database is decentralized and distributed, so that everyone has the entire database
on his or her own device. These are not copies of some original database – they are
the database itself, and each device syncs with all others. Thus, if a specific
device is hacked, or imports incorrect data, the network will not accept this, and
will correct the data using other databases. Unless a single entity controls more
than half of the devices on the network, it is almost impossible to delete or edit
data. In blockchain, data is stored in blocks of data that are linked to the
previous blocks. On average, every ten minutes Bitcoin creates a block of data and
all user devices will permanently store that data. Each block references the
previous blocks, so if someone wants to change data in a block, he must change all
previous blocks as well, which is almost impossible. Consider the following quote
from [2], which nicely captures the power of blockchain: Imagine a piece of paper
with a name written on it, and that name entitles a person to a pot of gold. You
put it in a room with 50 doors, and all those doors have a lock. But someone could
get through one lock and replace the name on the piece of paper. That is equivalent
to centralized database. Blockchain, on the other hand, will duplicate that paper
50 times and put it in 50 different room. In this setting, if someone wants to
break the system and change the name on the papers needs to break [at least 25]
rooms at the same time.[2] One important difference between blockchain and a
traditional centralized network is that blockchain-stored data is un-deletable and
un-editable. In a centralized database, there is always risk of fraud or external
hacker attacks, while in a blockchain, the network will work consistently unless an
attacker manages to take control of the majority of the network; therefore, a large
number of users almost significantly reduces the possibility of fraud. Although the
Internet makes it inherently challenging to confirm identities and hence to trust
other parties, blockchain facilitates trade on the Internet because, in effect,
“the system” ensures trust. In other words, fully secure trade with untrusted
parties is possible. This property enables the removal of third-parties in many
systems. “The blockchain is an enabling technology,” explains Dan Burrus. “This
means that you don’t need a third-party any more. The network itself replaces the
third-party institution. Therein lies the disruption. Whenever there is a third-
party involved to produce a transaction, the blockchain could replace it.” [3]
“[S]ince the whole system is running transparently, the system is absolutely open
source and there is no need for trust among every single node and any node can
never cheat other nodes.” [4] Blockchain is also sometimes known as the “Internet
of value” [5] – its advocates believe that it can revolutionize almost every
industry. While blockchain is finding its way into a variety of different
industries, including fine art, luxury goods, pharmaceuticals, medical devices, and
jewelry, for anti- counterfeiting and tracking, and import/export, as well as real
estate, etc., for record-keeping, many suggest that blockchain can make a
groundbreaking impact on supply chain management (see, for example, [6, 7, 8]).
Imagine using the concepts behind Bitcoin to remove the need for banks in the
supply chain – in principle, this could allow everyone to trade directly through
Internet. Using blockchain, one could trade directly with unknown parties, and
remain anonymous. Or at least, that’s why in some supply chain circles blockchain
is touted as the next big thing. Clearly, the $40 trillion supply chain market is
at the very least an interesting potential use case for blockchain in the future.
[9] Our focus in this white paper is on the challenges of using blockchain in
supply chain (which we call blockchain-enabled supply chain). From out point of
view, blockchain currently is a more effective component of financial systems than
of many physical systems, although we should point our that some authors even
question the value of blockchain in a financial context. For instance, Grym [10]
points out while Bitcoin solved double-spending problem, it has not even attempted
to solve the price stability problem and it is not clear whether or not central
banks are the only solution to this problem. Furthermore, blockchain does not
necessarily scale well. The volume of transactions that the Bitcoin network can
handle every second is roughly ten thousand times less than payment networks like
VisaNet. 2. Preliminaries Various authors have explored the potential impact of
blockchain on supply chain management, and indeed, many articles in the popular
press extol the potential of blockchain to impact the supply chain in the short
term. For example: • Jeremy Wilson, vice-chairman of Barclays Corporate Banking,
points out that blockchain can reduce supply chain paper work. He mentions the
first blockchain-based trade-finance deal. The process, from issuing to approval of
the letter of credit, usually takes between seven and 10 days, but could be reduced
to less than four hours.[11] The potential lead time reductions exist more broadly
in global supply chains—import, export, and port documentation could all be
expedited. • Hofmann et al. [12] claim using blockchain in supply chain finance
could expedite processes and lower the overall costs of financing programs. For
instance, blockchain could simplify payment insurance methods, decreasing the need
for letters of credit and therefore reducing transaction fees, increasing speed and
transparency, and so on. • Some individual products are challenging to duplicate,
and individual items are relatively easy to identify. In these cases, the key to
supply chain management involves establishing provenance of items being traded, and
blockchain can ensure a transparent, secure, un-editable and un-deletable
provenance which could help all parties in the supply chain. While the potential of
these impacts and applications to reduce costs and expedite supply chain tasks
should not be minimized, these are hardly path-breaking changes to current supply
chain operations. However, much of the discussion of the impact of blockchain on
supply chain management is more forward-looking; not so much exploring how
blockchain could impact supply chain today, as focusing on potential future supply
chains. Tapscott and Tapscott consider the possibilities of using blockchain
technology for the end-to- end supply chain in their book, Blockchain Revolution
[5]. They explain that Smart Contracts (which we explain below) will enable
companies to contract for price, quality, and delivery dates with just a few clicks
of mouse, and suggest many other ways that blockchain can impact supply chain
management. Indeed, many similar ideas can be found in articles written in the past
two years. However, all of these are presented at a relatively conceptual level, so
it’s difficult to assess how practical these scenarios actually are. Later, we
discuss limitations of current Smart Contracts, and the innovations that we believe
are necessary for them to significantly impact supply chains. Alsmiller [13]
suggests that blockchain can be used to track items from suppliers to ensure that
products are genuine and accurately described and safely and correctly transported.
Williams and Gerber [14] also discuss the benefits that transparency will bring to
the supply chain, focusing on how blockchain will allow us to see where our food
was grown. In principle, we could track each ingredient in our food from its
origin, so that we could, for example, understand whether the bottle of olive oil
we just bought is 100% olive oil, or if it is blended with other types of oil.
According to Project Provenance Ltd [15], since every transaction along the
blockchain-enabled supply chain is auditable, smart phone applications will be able
to display all relevant information to the consumer in real time, and crucially,
this information can be completely trusted. However, many hurdles currently exist
that make using blockchains this way challenging if not impossible—we discuss these
below. Several researchers have also considered the application of RFID to agri-
food traceability. Tian [4] specifically explores the potential of an agri-food
supply chain enabled with RFID tags and blockchain technology. He highlights an
important question that has not been considered previously: “whether the
information shared by supply chain members in the traceability systems can be
trusted.” He also claims that RFID and blockchain can together improve the
efficiency and reliability of the agri-food supply chain,
because he believes the biggest problem in traditional centralized supervision of
the agri-food supply chain is “[M] onopolistic, asymmetric and opaque information
system which could result in the trust problem, such as fraud, corruption,
tampering and falsifying information.” While Tian highlights an important concern,
as we discuss later in this white paper, it is unclear how his solution can fully
address this concern. Each of these visions of future blockchain-enabled supply
chains raise important questions. Indeed, these and similar views suggest that
markets will no longer need third parties to preserve trust and ensure quality, and
as a consequence, prices will decrease. Blockchain will provide the opportunity to
track every single part of each good to its origin. At a fundamental level, this is
the benefit that many pundits claim for blockchain-enabled supply chains. In our
view, blockchain and related technologies will need significant enhancement for
these visions to become reality. We discuss the key challenges that need to be
overcome later in this white paper. 3. “Pure” Blockchain and Supply Chain Recall
the time when supply chain management was first entering the popular consciousness—
it seemed that everyone had a different definition and understanding of this
concept. Two authors could discuss two entirely different things and call them
supply chain management. Something similar to this currently exists in the
blockchain space. To emphasize the difference between blockchain and similar
concepts, we list characteristics that are inherent in what will call “pure
blockchain” to highlight this difference: pure blockchain is a distributed,
decentralized database that maintain a continuously growing list of secure data
records without the need for trusted third-parties oversight or admission control
to the system. Blockchain can make the most impact when it ensures trust via system
design, rather than through verification of players/nodes. Hence, it is unlikely to
lead to pathbreaking changes in supply chain management if it doesn’t eliminate the
need for trusted parties in the network. To see this, consider a setting where a
single party owns all nodes in the blockchain network; would that party benefit
from using blockchain? Does blockchain add any value in this setting over what can
be accomplished using distributed databases or centralized databases? We believe
the answer in general is NO. (Here, blockchain would simply be a database
technology.) Although one of the key defining characteristics of blockchain is its
distributed database, a distributed decentralized database is not equivalent (even
conceptually) to pure blockchain. Many authors discuss the concept of private
blockchain, which is a closed system that features a decentralized, distributed
database. A private blockchain requires permission to join issued by a third party.
The third party who gives permissions to different users needs to be trusted by the
entire system; otherwise, it can add so many untrusted nodes to the system that the
system can break down, and changes can be made to stored data. Recall the original
point of pure blockchain—to ensure trust in the system while removing the need for
third parties who do not add value beyond ensuring trust. Private blockchain, on
the other hand, needs trusted third-parties to add nodes to the system. If such a
party exists, an integrated centralized database could be used for this type of
system. While some argue that blockchain-based private networks might be marginally
cheaper or more secure, this is a far cry from the benefits that have been claimed.
Indeed, from our perspective, private blockchain might add little value over a
trusted integrated database. Interestingly, many of the suggested potential use
cases for blockchain-enabled supply chain focus on private blockchain, although we
believe that a private blockchain is a fundamentally different concept from
blockchain as it is commonly defined. Pure blockchain is also not equivalent to
public blockchain. Public blockchains are distinguished based on who can access the
system, where users do not need any permission to join the network while pure
blockchains are distinguished based on the absence of trusted third parties. 3.1
Using Pure Blockchain in Smart Contracts Smart Contracts are computer
codes/programs that control the transfer of digital currencies based on predefined
conditions. For example, consider a Smart Contract for betting on a game. After the
result are revealed, there is no need for payment since the system will transfer
the digital money from the loser to the winner automatically. Many articles have
been written about blockchain-based Smart Contracts, but supply chains typically
involve the physical flow of products from initial suppliers to end customers, and
in this regard, the most important difference between supply chains and financial
institutions involves the existence of physical products. While various authors
(such as Tapscott and Tapscott [5]) have claimed that blockchain-based Smart
Contracts allow companies to develop payment, release date, and even quality-based
contracts, all of these require verification of some kind to ensure that the proper
amount of the proper quantity of materials have been delivered. Furthermore, as we
discuss below, it isn’t clear at all that cur- rent
barcode/RFID-tag/3D-stamp/sensor technology is sufficient to provide this
verification. In addition, the nature of supply chains is significantly more
complex than the straightforward examples typically given for Smart Contracts.
Indeed, it seems that given current technology, Smart Contracts will need trusted
third-parties to be used in most supply chain applications, so they don’t
immediately fit into a pure blockchain framework. Research will be needed to
overcome this limitation, as we discuss below. 3.2 Using Pure Blockchain for Track
and Trace The notion of being able to trace ingredients of any food or product back
to its origin is very compelling. For example, if one is interested in eating
organic foods, it could be valuable to be confident in food’s origins. Although the
use of blockchain to achieve this seems appealing, it isn’t immediately clear how
to ensure trust in such a system. How would the data be imported into the system?
How would it prevent a party in the supply chain from committing fraud? How would
this huge amount of data be stored in all devices? According to Tian [4], RFID
together with blockchain renders trust unnecessary. He explains: “since the whole
system is running transparently, the system is absolutely open source and there is
no need for trust among every single node and any node can never cheat other
nodes.” This point of view is consistent with many other blockchain-enabled supply
chain articles, but in our opinion misses a key point. Note that transparency in
blockchains refers to data and digital ledgers; it is not about products. If we
have a data in the database that says our factory bought a hundred ton of olives of
grade A quality, no one can delete or edit this data; however, the olives
themselves can be switched with olives of inferior quality. In addition, there are
likely to be non-blockchain-based markets and outlets for olives, and reliably
integrating trades in these markets with blockchain data is likely to be complex.
At a very high level, the key goal of blockchain-enabled supply chains is to obtain
100% certainty of provenance without the need for a trusted third-party; In this
case, however, the lack of a trusted third-party and inspections in the network
only encourages (or at least, doesn’t discourage) fraud.
The concepts of blockchain were first proposed by research in 2008 by someone using
the pseudonym Satoshi Nakamoto, who described how cryptology and an open
distributed ledger could be combined into a digital currency application (Nakamoto,
2008). Initially, the extremely high volatility of bit coin and the attitudes of
many countries towards its complexity somewhat restrained its development.
Nevertheless, the advantages of the blockchain, which is an underlying technology
of bit coins, have attracted increasing attention. Some of the advantages of
blockchain include its distributed ledger, decentralization, information
transparency, tamper-proof construction, and openness. The evolution of the
blockchain has been a progressive process. Blockchain is currently delimited to
Blockchains 1.0, 2.0, and 3.0, based on their implementations. The current research
provides more details about the three generations of blockchain in the Appendix.
The application of blockchain technology has extended from digital currency to
finance, and it has even gradually extended to healthcare, supply chain management,
market monitoring, smart energy, and copyright protection (Engelhardt, 2017;
Hyvärinen, et al., 2017; O’Dair & Beaven, 2017; Kim & Laskowski, International
Business Logistics Journal (IBL) Volume 1, Issue 2, December 2021 - ISSN 2735-5969
29 http://dx.doi.org/10.21622/IBL.2021.01.2.028 http://apc.aast.edu 2018; Radanović
& Likić, 2018; Savelyev, 2018). Blockchain technology has been studied in a wide
variety of academic disciplines. For example, some researchers have studied the
underlying technology of blockchain, such as distributed storage, peer-to- peer
networking, cryptography, smart contracts, and consensus algorithms (Christidis &
Devetsikiotis, 2016; Kraft, 2016; Cruz, et al., 2018). Meanwhile, legal researchers
are concerned with regulations and laws. As the old saying goes: “scholars in
different disciplines have many different analytical perspectives and speak many
different languages.” This paper focuses on analyzing and combining papers in the
fields of business and economics. The research aims to identify the key nodes
(e.g., the most influential articles and journals) in the related research and to
find the main research themes of blockchain in our discipline. In addition, the
research attempts to offer some recommendations for future research and provide
some suggestions for businesses that aim to implement blockchain in practice. This
study conducts a systematic and objective review based on data statistics and
analysis. The research first describes the overall number and discipline
distribution of blockchain-related papers. A total of 756 journal articles were
retrieved. Subsequently, the research refined the subject area to business and
economics, and managed to add 119 articles to our additional analysis. The research
then explored the influential countries, journals, articles, and most common
keywords. On the basis of a scientific literature analysis tool, the research was
able to identify five research themes on blockchain. The researchers believe that
this data-based literature review will be able to present the status of this
research more objectively. The remainder of this paper is organized as follows. In
the next section, the research provides an overview of the existing articles in all
disciplines. The research comprehensively describes the number of papers related to
blockchain and discipline distribution of the literature. The research then
conducts a further analysis in the subject field of business and economics, where
the research analyzes the countries, publications, and highly cited papers, etc.
The research also demonstrates the main research themes of this paper, based on
Cite Space. These are the recommendations for promising research directions and
practical applications. In the last section, the research discusses the conclusions
and limitations. Overview of the Current Research This paper first conducts a study
of the research of Science Core Collection (WOS), including four online databases:
Science Citation Index Expanded (SCI-EX- PANDED), Social Sciences Citation Index
(SSCI), Arts & Humanities Citation Index (A&HCI), and Emerging Sources Citation
Index (ESCI). This research choses the WOS because the papers in these databases
can typically reflect scholarly attention towards blockchain. When searching the
term “blockchain” as a topic, the research found a total of 925 records in these
databases. After filtering out the less representative record types, the research
reduced these papers to 756 articles that the research then used for further
analysis. The research extracted the complete bibliographic record of the articles
identified by the search from WOS, including information on the title, author,
keywords, abstract, journal, year, and other publication information. This research
was then exported to CiteSpace for subsequent analysis. CiteSpace is a scientific
literature analysis tool that enables us to visualize trends and patterns in the
scientific literature (Chen, 2004). In this paper, CiteSpace was used to visually
represent complex structures for statistical analysis and for conducting cluster
analysis. Table 1 displays the number of academic papers published per year. The
research listed the number of all the publications in WOS, the number of articles
in all the disciplines, and the number of articles in business and economics
topics. It should be noted that the research retrieved the literature on March 25,
2019. Therefore, the number of articles in 2019 relatively small. The number of
papers has continued to grow in recent years, which indicates that there is a
growing interest in blockchain.
Novel technologies emerging under the umbrella of Industry 4.0 are creating new
business and fnancial opportunities for supply chain net- works. According to the
Computing Technology Industry Association (CompTIA), the Internet of Thing (IoT),
artifcial intelligence, 5/6G net- works, serverless computing, Blockchain,
Robotics, Biometrics, 3D print- ing, Augmented Reality/Virtual Reality, and Drones
are the top ten emerging technologies in 2019 (Rayome, 2019). Although these tech-
nologies are Industry 4.0 processes enablers, some of them – Blockchain, 6G network
technologies, and wireless communication – are emerging and well-positioned for
innovative business models. For instance, shift- ing trust from organizations to
analytics, automated smart contracts, and facilitating sharing economy applications
without a central entity, are examples of Blockchain's potential for changing
business models (Nowiński and Kozma, 2017). The contribution of technology to
fundamentally change both busi- ness and society has been acknowledged by scholars.
However, minimal attention has focused on how these emergent technologies address
sus- tainability challenges; especially helping organizations move towards a
circular economy (CE). There are also potentially detrimental outcomes.
Applications of technology in different industries – ranging from agriculture to
trans portation and energy systems – have imposed threats to nature and global
ecosystems. Understanding the complex integrated system of technology, society, and
business is necessary for identifying and ad- dressing sustainability challenges.
This study contributes to sustainable development and CE literature by offering a
set of guidelines on how technology plays a role in a sus- tainable society. The
extent by which adverse environmental effects of these emergent technologies can be
ofset by new sustainability-related opportunities they offer is a central tension
and theme. There is a lack of scientifc research on the impact of Industry 4.0 on
solving industrial symbiosis and sustainability problems (Stock and Seliger, 2016).
We review the current state of the art of Industry 4.0 and Blockchain technology
with a focus on sustainability relationships to these concepts. The opportunities
offered by Industry 4.0 and Blockchain technology, as well as the adverse
sustainability consequences in the manufactur- ing and CE context, are addressed.
The capabilities of Blockchain tech- nology for promoting green behavior among
consumers and decreasing the operational costs of systems appear in the remainder
of the paper. A summary of research directions and concerns concludes the paper.
The remainder of this paper is organized as follows. Section 2 pro- vides brief
descriptions of sustainability, industry 4.0, and Blockchain. Section 3 introduces
the research method for collecting and analyz ⁎ Corresponding author. E-mail
address: [email protected] (S. Behdad)
https://doi.org/10.1016/j.resconrec.2020.105064 Received 31 December 2019; Received
in revised form 9 June 2020; Accepted 14 July 2020 Available online xxx 0921-3449/©
2020. UNCORRECTED PROOF B. Esmaeilian et al. Resources, Conservation & Recycling
xxx (xxxx) xxx-xxx ing the literature. Section 4 reviews the research work on the
sus- tainability of Industry 4.0, and Section 5 discusses the capabilities of
Blockchain for addressing sustainability issues. Section 6 discusses the Blockchain
adverse effects. Section 7 summarizes research gaps, and f- nally, Section 8
concludes the paper. 2. Background Before reviewing the literature on the
sustainability of Industry 4.0 and the impact of Blockchain on sustainable supply
chains, we will briefy review three concepts of sustainable development, Industry
4.0, and Blockchain in this section. 2.1. Sustainable development Before
introducing Industry 4.0 and Blockchain as enablers for sus- tainable development,
a brief discussion on sustainability is provided. The focus will be on the circular
economy concept to acknowledge the importance of economic sustainability and the
role of industry in imple- menting sustainability principles. The circular economy
concept has originated from both industrial ecology and environmental economics.
There is no consensus on the ex- act definition of the circular economy (Korhonen
et al., 2018). Prac- titioners often consider it as a way to overcome the
limitations of lin- ear production and consumption models for increasing resource
use ef- fciency. The circular economy has been introduced to achieve a better
balance between the economic aspect and the environmental and so- cial aspects of
sustainability. Countries such as China promote CE as a cleaner production strategy
that supports resource use effciency. Other regions, such as the European Union,
Japan, and the USA also consider it as a waste management strategy (Ghisellini et
al., 2016). Economic system circularity was introduced with the law of thermo-
dynamics as its foundation (Pearce and Turner, 1990). It initially was to describe
matter and energy degradation to maintain the sustainabil- ity of Earth's
resources. In these initial CE descriptions, the environment has three main
functions: supply resources, provide a life support sys- tem, and offer a sink for
emissions and waste. Unlike other economic functions with explicit pricing,
sometimes no direct price or market for environmental goods exists (what is the
price of air and water qual- ity?), although recent Life Cycle Assessment (LCA)
methods have tried to monetize environmental prices, indicating the loss of
economic wel- fare as a result of environmental emissions (De Bruyn et al., 2018;
Weidema, 2015). Environmental policies, consumer and producer re- sponsibilities
have been employed to mitigate the high consumption of resources (Ghisellini et
al., 2016). CE has several value drivers: 1) extending an asset's usage cycle, 2)
enhancing asset utilization through sharing or resource productiv- ity, 3) asset
looping and cascading through reuse, remanufacture, re- cycling, or moving to a
secondary usage, and 4) regenerating and preserving natural resources by returning
biological elements to their original ecosystem and avoid nutrients leakage from
one system to another (Ellen MacArthur Foundation, 2016). To implement these value
drivers, a framework named ReSOLVE – Regenerate, Share, Opti- mize, Loop,
Virtualize, and Exchange has been introduced by the Ellen Macarthur foundation
(Prendeville et al., 2017). CE is not without its criticism (Prendeville et al.,
2017): (1) First is the definition of CE. Practitioners are often unclear about the
actual principles of CE. Some consider it as a macro-level activity and while
others view it as a micro-level intervention. (2) Second, some of the principles
may not necessarily be benefcial for the environment. For instance, infnite
recycling of materials and energy will not be with- out effciency loss, or reuse of
old technologies may result in higher energy consumption or sharing economy
initiatives that may not be as environmentally viable as promoted. (3) Third, very
few businesses adopt CE-related strategies. Also, CE models often give more
authority to businesses than consumers and social communities. While CE can
companies realize business outcomes of implementing sustainable operations, the
scope and scale of CE efforts implementation are currently limited. As new
technologies emerge, novel business mod- els can orient organizations toward
enhancing sustainability outcomes through CE principles. 2.2. Industry 4.0 Industry
4.0 – derived from the German word Industrie 4.0 – is de- fned as a set of
connected cyber-physical objects capable of using big data analytics within the
manufacturing and production domains (Vo- gel-Heuser and Hess, 2016). Industry 4.0
is part of smart city initia- tives due to cyber-physical systems (CPSs)
applications and the Indus- trial Internet of Things (IIoT) (Lom et al., 2016).
Researchers often use these terms interchangeably. For instance, industry 4.0 is
commonly used as a synonym for CPS. Different characteristics have been assigned to
Industry 4.0 with the aim of not only equipping manufacturing sys- tems with
advanced data acquisition technologies but also value gener- ation and services
innovation (Kagermann, 2015). Germany has developed a four-step strategic plan for
transforming industries of information-age to Industry 4.0: (1) building a network
of CPSs, (2) researching the ‘smart factory’ and ‘intelligent production’ concepts,
(3) integrating the elements of value chains on three levels of horizontal
integration, vertical integration, and end-to-end integration, and fnally (4)
achieving eight planning objectives. The eight planning objectives include
standardization, effcient management, a reliable in- dustrial infrastructure,
safety and security, organization and work de- sign, workforce training, creating a
regulatory framework, and improv- ing the effciency of resources (Zhou et al.,
2015). Short development time, mass customization, fexibility in product design and
production, decentralization of production systems, and re- source effciency are
among several capability goals of Industry 4.0 (Lasi et al., 2014). Table 1
provides a brief description of several technological advancements that power
Industry 4.0. Many studies have reviewed Industry 4.0 and the opportunities of-
fered by the latest industrial revolution. Figs. 1 and 2 provide reports of the
number of recent publications with Industry 4.0 or Industrie 4.0 terms in their
titles and the geographical locations, respectively. As seen in Fig. 2, Germany is
leading Industry 4.0 research. Table 1. Examples of Industry 4.0 technologies.
Technology Description Artifcial Intelligence Using computer systems to simulate
human intelligence Robo-Advisory Digital experts systems, mathematical rules,
and algorithms that provide fnancial advice with minimal human intervention VR/AR
Virtual Reality/Augmented Reality Additive Manufacturing The use of computer
control to manufacture objects by adding materials together layer by layer
Industrial Internet of Things Connecting and monitoring industrial objects and
physical devices through the internet 6G network The 6th generation of mobile
networks that interconnects not only people but also devices and objects Serverless
computing A new resource allocation model for cloud-computing execution in which
cloud providers match demand and capacity Biometrics Technology for body
measurement and calculation for an individual's identity identifcation and
surveillance control Cybersecurity Protection of computer systems from
malfunctioning Blockchain A decentralized, distributed data structure and public
digital ledger 2 UNCORRECTED PROOF B. Esmaeilian et al. Resources, Conservation &
Recycling xxx (xxxx) xxx-xxx Fig. 1. The number of publications with the term
“Industry 4.0” or “Industrie 4.0” in their titles (extracted from Compendex
database on 03/31/2020). Fig. 2. The number of publications with the term “Industry
4.0” or “Industrie 4.0” in their titles based on the principal place of publication
(extracted from Compendex database on 03/31/2020). Given that Industry 4.0 is such
a broad topic, to show its potential one of the most recent elements, blockchain
technology is evaluated. The importance of blockchain resides in its abilities in
enhancing the level of information integration across supply chains and between
vari- ous actors, one of the main agendas of industry 4.0. While in Section 4 of
this paper, we review current research in In- dustry 4.0 for fostering
sustainability efforts, the main focus of the paper will be on the impact of
Blockchain and the potential of this technology for enhancing sustainable
operations. 2.3. Blockchain technology A blockchain is a distributed data structure
– a distributed ledger – in which the data is shared on a peer-to-peer network. The
network members – nodes – communicate and validate the data following a pre- defned
protocol without a central authority. Distributed ledgers can be either
decentralized, giving equal rights to all users or centralized, pro- viding specifc
users with special rights. Fig. 3 shows the evolution of computer networks from
decentralized to decentralized and distributed systems. Blockchain is, by nature, a
distributed ledger since each node of the network has a copy of the ledger.
Depending on the right of the users, Blockchain can be designed as a centralized or
decentralized ledger. If Blockchain is designed such that the decision-making is
shared among multiple users, it is decentralized; if one central entity is the pri-
mary decision-maker, then it is centralized. Blockchain technology was popularized
with the Bitcoin cryptocur- rency peer-to-peer network. Blockchains are created
using cryptogra- phy in which each block –transaction, fle of data – has a
cryptographic hash and is linked to a previous block. Once a block is verifed by a
certain percentage of the network nodes, it is added to previous blocks and forms a
blockchain – also known as a public ledger of transactions (Casado-Vara et al.,
2018). Blockchain technology alters how administrative control is digitally
regulated and maintained. In blockchains, data are converted to digi- tal codes,
are stored in shared databases, have higher transparency, and limited risk of
deletion and revision – immutability. Blockchain potential lies with every
agreement, payment, and transactional activity having a digital record. These
records may be validated and shared among in- dividuals, machines, algorithms, and
organizations. Intermediaries such as brokers, bankers, and lawyers are needed less
often (Lansiti and Lakhani, 2017). Intermediaries are entities that act as
middlemen and handle the accuracy and verifcation of transactions in different
indus- tries. With blockchain, trust is shifted from human and traditional agents
for verifying transactions to computer codes. As an example, in the Bitcoin market,
an individual has full control over their Bitcoin balance. Unlike a bank balance,
an individual's Bitcoin balance cannot be manipulated or viewed digitally. If the
individual has the proper passcode, they can authorize entry on the blockchain
ledger and transfer it to another individual's address (Athey et al., 2016).
Transparency, less risk of fraud, instantaneous transactions, privacy and security,
fnancial data assurance, and no exchange costs are among blockchain technology
benefts (Sharma et al., 2017) (Crosby et al., 2016). Blockchain typically includes
the following capabilities, which may be dependent on the platform used (Barton,
2018): • Shared ledger: a data structure that is distributed locally and shared
between different participants; • Permissioning: secure and authenticated
transactions that ensure pri- vacy and transparency of data; • Smart contracts:
business terms are embedded in a database and are implemented with transactions;
and Fig. 3. Blockchain is a distributed ledger (Three stages of computer network
evolution, source: Daxx.com). 3 UNCORRECTED PROOF B. Esmaeilian et al. Resources,
Conservation & Recycling xxx (xxxx) xxx-xxx • Consensus: transactions are endorsed
by relevant users that ensure im- mutability and traceability of data. Most of the
existing blockchain studies focus on Bitcoin and cryp- tocurrency applications
(Yli-Huumo et al., 2016). However, the tech- nology can be employed in different
industries ranging from health- care to real estate and energy markets (Athey et
al., 2016). Although blockchain is in its relative infancy, some consider it a
general-purpose technology (GPT) with several key features of GPTs (Kane, 2017).
GPTs such as the steam engine, electricity, and the internet result in innova- tion
and productivity gains among multiple industries and lead to eco- nomic growth for
multiple years (Catalini and Gans, 2016). This out- come is part of the blockchain
promise; whether it comes to fruition is an open question. Blockchain has numerous
current limitations before broad adoption and implementation. Scalability,
regulatory challenges, security risks, and energy consumption are major
limitations. In the smart contract world, underlying rules that govern the system
are defned by software engineers and coders as they decide about the architecture,
applications, and structure of the network. Determining the content and scope of
smart contracts by coders brings many diffculties in implementing com- pliance with
regulations. It is challenging to write all possible scenar- ios that may happen in
complex business scenarios as computer codes in smart contracts, and smart
contracts will still have to rely on courts and traditional legislators in the
matter of doubts. Besides the infex- ibility of smart contracts to adapt to the
changing preferences of par- ties and unique uncertain scenarios, the insuffciency
of smart contracts in connecting to the physical world and verifying information
recorded on the ledger (e.g., verifying the person claiming to have the title of
the land) are among other legal challenges facing blockchain platforms (von Haller
Gronbaek, 2016). The rise of permissioned or private Blockchains for industrial
appli- cations also has critics. Permissioned blockchain is very different from
public blockchain; its emergence has hidden blockchain platforms’ ad- vantages.
Some believe that permissioned blockchain is just a shared database (Narayanan,
2015). Due to this confusion, some contend that blockchain technology is not an
innovative technology. Blockchain undergoes several scalability issues such as
communi- cation malfunctions among users, data storage, and linear transac tion
record (Barber et al., 2012). The scalability issues originate from growing the
number of transactions, and diffculty of the consensus pro- tocols (Conoscenti et
al., 2016). To address scalability issues, differ- ent scaling approaches have been
developed in computer science litera- ture. The idea behind scalable networks is to
enable information trans- fer among intermediaries without recording every
transaction on the blockchain (Xie et al., 2019). Other blockchain criticisms
exist. While Blockchain helps with reduc- ing the needs for an intermediary and
assists with the automatic verif- cation of transactions due to capabilities such
as the tamper-proof nature of Blockchain and the use of cryptography hash
functions, it is almost impossible to alter information once it is recorded on the
ledger. There- fore, the correct information must be entered into the Blockchain
sys- tem. This challenge is known as the last-mile problem or endpoint vul-
nerability. The verifcation of data uploaded on digital platforms still re- quires
intermediaries. Mechanisms are needed to ensure that the link be- tween digital
records and physical entities are correctly established, and the information
uploaded on digital platforms is accurate. Mechanisms such as IoT sensors and
certifed inspectors can be used to ensure the ac- curacy of information uploaded on
the network (Gopalakrishnan and Behdad, 2019). Although the current development of
blockchain supports the anonymity of users’ identity via digital signature, data
protection via im- mutable ledger, and confdentiality of transactions via
cryptography, the security of consensus algorithms is still a problem. More secure
consen- sus algorithms are needed for enhancing security and system resistance to
attacks (Zhang et al., 2019). Besides human-related security issues, 51%
vulnerability, double spending, and the lack of a proper mecha- nism for protecting
private keys are among other security issues. Public blockchains are exposed to 51%
attacks, in which a group of users con- trol
most of the network's computing power and can control the ledger. Although
blockchain has its share of criticism, it is gradually be- coming integrated into
the industry, with new user applications contin- uously identifed. Existing large
technology companies are investing in this technology, and various efforts on
developing socially open-sourced platforms are underway. These activities exhibit
blockchain technol- ogy potential; and its integration with Industry 4.0. Fig. 4
summa- rizes the capabilities and criticisms of blockchain and the cur Fig. 4. The
capabilities, criticisms, and current situation of Blockchain technology. 4
UNCORRECTED PROOF B. Esmaeilian et al. Resources, Conservation & Recycling xxx
(xxxx) xxx-xxx rent market situation. Figs. 5 and 6 show the number of scholarly
pub- lications using the word Blockchain in their titles and the principal place of
the publications.
Supply chain is a set of sequential stages in the manufacturing, transportation,
storing, or distribution of a product [1]. Each stage may be handled by one or many
companies, suppliers, or stakeholders. Supply chain plays a critical role in the
global economy [2]. The International Trade Administration reports that supply
chain transactions account for over 76% of the world trade [3]. Large corporations
outsource their assembly lines to low-cost regions to decrease production costs.
The stages of the supply chain have been further divided and there- fore, handled
by an increasing number of affiliates. Supply chains have become more global,
complex, and interdepen- dent across stages [4]. Supply chain involves various
participants and stakehold- ers and numerous processes in multiple stages. It is
dif- ficult to keep track of the processes, materials, and the ownership at
different stages. Moreover, stages of a supply chain are often located at different
places and sometimes across different countries. The supply chain complexity im-
poses administrative challenges for an efficient supply chain management. Companies
aim to address the increasing supply chain com- plexity by adopting different
technologies such as barcodes, radio-frequency identification (RFID), and global
positioning system (GPS) to directly collect information from the pro- cesses and
stages of the supply chain. Data analytics is another technology that is
increasingly used for stock management and demand prediction [5]. Although
companies use data collection technologies as those described above, information on
supply chain processes and changes of product ownership need to be resilient to
acci- dental or intentional modifications. Moreover, supply chains This work is
licensed under a Creative Commons Attribution 4.0 License. For more information,
see https://creativecommons.org/licenses/by/4.0/ 230 VOLUME 1, 2020 must provide
transparency so that stakeholders may have ac- cess to data on the status of the
supply chain. Today’s supply chains need to be more reliable than ever. Disruptions
in the supply chain can create significant losses for companies in both short and
long terms and increase costs for end customers. Such companies need to create fast
and agile solutions to meet dynamically changing demands [6]. Businesses and
customers are raising new demands for infor- mation on a product, such as
authenticity, origin, quality, and sustainability. These demands are associated
with the supply chain of a product. However, recorded data in a supply chain can be
altered by participants and, at the same time, its data may be inaccessible to
customers. To resolve most of the supply chain challenges, data must be kept
immutable and accessible. Blockchain is a promising technology with the potential
to satisfy many of the supply chain challenges. Blockchain is a distributed and
immutable ledger that provides a trustable record that cannot be manip- ulated or
tampered with [7], [8]. Its distributed architecture makes it immune to
manipulation by a centralized authority. Blockchain was first introduced by Bitcoin
in 2008 [9]. It has been considered a solution to address the supply chain
challenges for different industries [10]–[25]. Recent advance- ments in computing,
sensing, and mobile technologies have made it possible to apply blockchain in
several industries, in- cluding healthcare [26]–[30], energy management [31]–[35],
entertainment [36], [37], aircraft [38], vehicular network [39], and construction
[40]. In this paper, we survey existing blockchain approaches applied to supply
chains with a focus on different indus- tries. These industries include food, wine,
pharmaceutical, healthcare, and others. We highlight the objectives and chal-
lenges reported for each industry and identify the proposed blockchain frameworks
that address these challenges. We also discuss challenges and opportunities for
future blockchain frameworks and their applications in supply chain. The remainder
of the paper is organized as follows. Sec- tion II introduces supply chain and its
features and describes the challenges that its management faces to achieve high
effi- ciency and efficacy. Section III introduces blockchain frame- works that have
been proposed for management of supply chains and others that can potentially be
used for such a pur- pose. Section IV analyzes blockchain framework adoptions that
have been proposed to address various supply chain chal- lenges in different
industries. Section V discusses opportuni- ties and challenges of the application
of blockchain on supply chain management. Section VI presents our conclusions. II.
SUPPLY CHAIN A. SUPPLY CHAIN MANAGEMENT A supply chain can be highly complex as it
may comprise a large number of stages and all the involved parties need to keep
track of the development of the product at each stage. Fig. 1 illustrates an
example of the stages of a supply chain. The number of stages may increase in
proportion to the com- plexity of the product. Moreover, a supply chain may be a
set FIGURE 1. An example of a supply chain. of several intertwined supply chains
because some products may be parts for another. As an example, suppliers provide
raw materials to the pro- cessing units that manufacture parts of a complex
product. The parts are then assembled into a complex product as the final product.
These final products are then distributed by wholesalers or distributors. The
involved parts could be dis- tributed among various geographic locations where
logistics are handled by importers and exporters across country lines. Further
distribution of the products is handled by retailers who bring them to the end
customers. The effectiveness of how materials, parts, and products are moved along
the supply chain can affect the efficiency of the supply chain and, in turn, the
cost of the product [41]. Some of the functions of supply chain management are
inventory and warehouse management, supplier management, transportation,
bookkeeping, and other operations [42]. Of- ten, the handling of the product, as it
passes through the supply chain, is a transaction made between participants.
Transactions should be recorded accurately and reliably. Trust amongst the supply
chain parties ensures smooth and seamless transactions. Moreover, for newly
introduced trading partners, supporting technology that provides background
information about the involved parties can speed up the process of building such
partnerships. B. CHALLENGES IN SUPPLY CHAIN AND ITS MANAGEMENT The complexity of
supply chain management has increased by not only directing the flow of goods but
also the flow of information [43]. Although technology has digitized and automated
various functions of supply chain management, some challenges remain for making the
supply chain more efficient, reliable, and secure. In this section, we outline the
challenges that supply chains need to address to ensure their efficiency and trust
among their stakeholders. 1) PROVENANCE Provenance is a record of ownership over
time [44]. Tracking and traceability are functions enabled by provenance. Track-
ing materials and the origin of a product is a complex oper- ation. For example, a
distributor may acquire produce from various farms and then distribute it to
customers in the food industry. In the case of product recalls, it usually takes a
long time to trace back the source of a contaminated product, and VOLUME 1, 2020
231 SHAKHBULATOV ET AL.: HOW BLOCKCHAIN ENHANCES SUPPLY CHAIN MANAGEMENT: A SURVEY
yet, sometimes the location is not precise. A system with tracing capability would
overcome this issue. Counterfeit detection is a popular application of prove-
nance. Having a record of the product’s provenance may help detect counterfeit
products or verify a product’s originality. Such a record is directly associated
with the product’s supply chain, but the record has to be both accessible to some
stake- holders (e.g., consumers) and unalterable by supply-chain stakeholders. A
product passes through different stages of its supply chain and spends a different
amount of time in each one. To oversee the operation of its supply chain, tracking
is a necessary feature. For example, the shipment of a product is often carried out
by a third-party logistics company and that makes real-time tracking by supply-
chain participants chal- lenging. In addition, having information on the status of
the product and forecasting its progress can facilitate data-driven strategies that
benefit the management of the supply chain and its stakeholders. An analysis of the
supply chain with real-time tracking can provide information about what occurs in
the different stages. This information can be used to evaluate the performance and
efficiency of suppliers and to identify and mitigate potential risks. 2)
PERFORMANCE IMPROVEMENT Performance of a supply chain can be defined by different
key indicators, such as the time a product spends on each of its stages, the cost
of manufacturing a product, and production yield [42]. Because the performance of
the supply chain may directly affect the cost of the product, it must be managed
and followed carefully. 3) QUALITY ASSURANCE AND QUALITY CONTROL Quality assurance
and quality control are the compliance of a product, manufacture, or supply chain
with a variety of quality attributes set out by the stakeholders, customers, or
regulatory agencies [45]. These features may incorporate not only safety guarantees
for consumer products but also compliance with established standards. 4)
SUSTAINABILITY A study by McKinsey states: “The typical consumer com- pany’s supply
chain creates far greater social and environ- mental costs than its operations, and
that accounts for more than 80% of greenhouse gas emissions and more than 90% of
the impact on air, land, water, biodiversity, and geological
resources” [46]. A sustainable supply chain must consider its impact on the
environment and use environmentally-friendly materials and processes, so that it
can reduce greenhouse gas emissions along its stages. A supply chain must account
for its production of greenhouse gas emissions and other con- taminants in a
reliable and unbiased way. Such accountability would be beneficial for
environmental impact evaluation by stakeholders and regulators [47]. Because of the
broad variety of parties involved in a sup- ply chain, tracking and quantifying its
environmental impact is challenging. These tasks often incur additional costs. Al-
though some large manufacturers may report their product carbon footprint [48], the
numbers are often estimates. There- fore, there is a need for widely deployable
standards on envi- ronmental impact for industries to follow. 5) TRANSPARENCY
Transparency refers to the availability of and accessibility to information about
the supply chain by trading partners, share- holders, consumers, and regulatory
bodies [49]. Transparency makes data about the status of processes and materials in
their supply chain accessible stakeholders. Transparency in a supply chain has
shown to have a positive impact on business reputation [49]. There has been an
increas- ing demand for transparency of supply chain by both busi- nesses and
consumers. This feature requires that supply chain data remain immutable to ensure
trust amongst the involved parties. Transparency can be partial to some
stakeholders; some information about the supply chain may be accessed by only a
group of designated parties. Because the cost incurred by the stages of the supply
chain affects the final cost of the product, transparency enables accurate cost
calculations and the exposure of irregular operations along the supply chain [50],
[51]. 6) DATA PRIVACY AND CONFIDENTIALITY Sensitive and proprietary information
about a supply chain such as financial records needs to be accessible only to some
stakeholders. An example of this information includes the cost of raw materials,
benefits, surpluses, etc. Any information about transactions performed between
different parties must be kept confidential but verifiable. III. BLOCKCHAIN
FRAMEWORKS A blockchain is a distributed immutable ledger that is used to record
transactions performed between different users without resorting to a centralized
and trustable party. Immutability is the driving feature of blockchain; it
facilitates building trust among users by providing a permanent and verifiable
record of transactions. A blockchain comprises a peer-to-peer net- work of
participant nodes, a distributed ledger consisting of immutable blocks of data,
transactions recorded in the blocks, smart contracts to execute the transactions,
and a consensus algorithm that decides the proposer of the next block. Fig. 2 shows
the components of a blockchain. Participant nodes in a blockchain can be either a
client, a light client application (light node), or a miner/validator (full node).
A blockchain user communicates through the client node. A client node is a
participant that generates transactions. A light node keeps track of the
blockchain’s headers to verify the validity of a client’s transactions. A full node
participates in the consensus process and proposes and validates blocks, records
transactions by executing functions contained within 232 VOLUME 1, 2020 FIGURE 2.
Components of a blockchain. TABLE 1. Comparison of Permissionless and Permissioned
Blockchains a smart contract, and appends verified blocks to its local copy.
Different blockchain frameworks may define the functions of miners and validators
differently. Therefore, we call a node miner and validator in each blockchain
framework according to their usage. A block is sequentially linked to a previously
recorded block using a hash pointer. The hash pointer contains the hashed
information of the contents of the previous block and that guarantees the sequence
of the blocks and the integrity of the data. The result is an immutable distributed
ledger. Every block of data contains a group of verified transactions and a header
with metadata including a proof of block authenticity and a hash pointer pointing
to the previous block. A. CLASSIFICATION OF BLOCKCHAINS Blockchain may achieve
different levels of decentralization and be classified into permissionless (or
public), permissioned (or private), and hybrid architectures. Table 1 shows differ-
ences between permissionless and permissioned blockchains. In a permissionless
blockchain, access to the network and participation in the consensus algorithm is
open to anybody who wishes to participate. Participants can use public keys that
enable pseudo anonymous identities and replace them at any time, without requiring
to reveal their real identities. Permissionless blockchains use a consensus
algorithm that defines strict rules to accept proposed blocks and an integrated
incentive mechanism that rewards honest participation. How- ever, decentralization
is achieved at the expense of low trans- action throughput, i.e., the number of
recorded transactions per second (tps). In a permissioned or private blockchain,
access to the network, and participation in the consensus algorithm is restricted;
participants of a permissioned blockchain FIGURE 3. Components of a consensus
algorithm. are required to register before they can participate in the blockchain.
Because the identities of the participants in a permissioned blockchain are known
to the registered members, malicious behavior can be detected by byzantine fault
tolerant (BFT) consensus algorithms. Distributed consensus algorithms are said to
be crash fault tolerant (CFT) if they can tolerate a number of crashed nodes, i.e.,
nodes that stop working. Similarly, consensus algorithms are said to be BFT if they
are both CFT and can tolerate a number of nodes acting maliciously while appearing
to be working normally. Blockchain consensus algorithms can either be CFT or BFT.
For a detailed description of distributed consensus algorithms, the readers are
referred to [52]. However, BFT consensus algorithms may not scale well because
their complexity and overhead increase as the number of validators grows. Incentive
mechanisms are not needed to reward honest par- ticipation in permissioned
blockchains because validators are granted a level of trust. These blockchains
provide data access to the participants in the distributed ledger. Such features
allow a permissioned blockchain to use a light-weight con- sensus algorithm that
can achieve high transaction throughput, but at the expense of diminished
decentralization. A hybrid blockchain combines the features of both permis- sioned
and permissionless blockchains. It inherently includes the combination of data
privacy and high throughput of per- missioned blockchains and the high level of
decentralization of permissionless blockchains. Such a blockchain has a pri- vate
and a public ledger. It records sensitive data in a private ledger that are
accessible to some designated stakeholders and non-sensitive data in a public
ledger that are available to all participants. B. BLOCKCHAIN CONSENSUS ALGORITHMS
Blockchain consensus algorithms define the set of rules for miners or validators to
agree on a common truth. As shown in Fig. 3, blockchain consensus algorithms may
include the following five components: block proposal, block validation,
information propagation, block finalization, and incentive mechanism [52]. Yet, not
all blockchain consensus algorithms implement all five components. Block proposal
is a process where miners or validators decide the next proposer of a block. For
security reasons, a block proposal mechanism in permissionless blockchains requires
a minimum inter-block proposal time. In addition, miners or validators are required
to provide Proof of Work (PoW) or Proof of Stake (PoS), to earn the right to
propose the next block. VOLUME 1, 2020 233 SHAKHBULATOV ET AL.: HOW BLOCKCHAIN
ENHANCES SUPPLY CHAIN MANAGEMENT: A SURVEY Block validation is the process to
verify that received blocks are syntactically correct. A block is valid when it
includes the solution to a cryptographic puzzle and the verified digital signatures
of the participants in the transactions recorded in the block. In information
propagation, full nodes broadcast blocks to the peer-to-peer network. They must
follow the broadcast or dissemination protocols of a framework. Block finality is
the process to make the recording of a block irrevocable once it’s committed to the
distributed ledger. Once it is received and verified by participant nodes, a block
is appended to the local copy of the distributed ledger that is maintained by full
nodes. A consensus algorithm can be classified as either deterministic or non-
deterministic accord- ing to how it proposes a block. A consensus algorithm is
deterministic when it proposes only one block at a time. This proposal occurs after
a leader is selected in every round. On the other hand, a consensus algorithm is
non-deterministic when it proposes two or more blocks at a time. Because it is
possible to have blockchain forks in the latter case, i.e., two different valid
blocks that extend two different chains, a full node must decide which chain to
extend and in this way, to remove forks. A full node can decide to extend the
longest-chain or the chain that has received the majority of votes from a group of
validators. Incentive mechanisms are used to prevent abnormal or ma- licious miner
behavior by rewarding the miners who follow the rules. In a permissionless
blockchain, miners are pseudo- anonymous. Therefore, miners could collude and
propose in- valid blocks and invalidate the main blockchain. Some con- sensus
algorithms may implement an incentive mechanism to prevent such malicious miner
behaviors. Moreover,
consensus algorithms may also establish penalties for miners that act maliciously.
C. CONFIDENTIALITY Clients use a public key as a pseudo-identity to participate in
the network and a private key to digitally sign transactions. Transactions hold
digital signatures that are used to ensure that the state of the ledger (i.e., the
ownership and distribution of the assets) is only modified by legitimate clients,
which are authenticated through their public and private keys. However, the
contents, including sensitive data, of both transactions and operations performed
by smart contracts are recorded in plain text in every local copy of the
distributed ledger. Some blockchain frameworks address this data privacy prob- lem
using cryptographic algorithms and methods, e.g., zero knowledge proofs (ZKPs), to
encrypt sensitive data of both transactions and operations in smart contracts
before sending them to the blockchain. However, this feature comes at the expense
of lowering the performance. In particular, permis- sioned blockchain frameworks
are designed to provide data privacy guarantees by limiting access to some portion
of the distributed ledger to the public. These guarantees can also be provided by
segmenting the blockchain into small indepen- dent blockchains where each of them
is used in a different section of an organization. Other blockchain frameworks aim
to further enhance data privacy by delegating the execution of operations in smart
contracts to only a pre-selected set of participants. D. SMART CONTRACTS Smart
contracts are self-executable computer programs that implement trading terms in a
transaction that are verified by every full node. The execution of some smart
contracts may cause the entire blockchain to halt when contracts have er- rors,
such as non-deterministic functions, caused by coding mistakes or attacks. To
address this problem, some blockchain frameworks bound the amount of running code
by establishing service fees for every executed line of code. Therefore, only
deterministic code is allowed. E. PERFORMANCE Transaction throughput is a common
and main performance indicator of a blockchain framework. The performance of a
blockchain framework may be determined by the consen- sus algorithm, the size of
the network, i.e., the number of participants, and the block size. Transaction
throughput in permissionless blockchains, specifically on PoW-based ones, tends to
be low because of the high computational cost of cryptographic puzzles that miners
must solve to propose valid blocks. Solving cryptographic puzzles in PoW could be
time- consuming and, therefore, limit transaction throughput. Permissioned
blockchains achieve higher transaction throughput than permissionless ones because
the consensus algorithm of permissioned blockchains is generally determin- istic.
Some features, such as the block size, in a few per- missioned blockchain
frameworks can be customized. These frameworks may also follow modular designs. The
perfor- mance of a blockchain framework may be also affected by the size of the
block. For example, a large block may take longer time to be committed than a
smaller one. Network delays may also undermine the efficiency of the consensus
algorithm, particularly for consensus algorithms with built- in voting mechanisms
because nodes broadcast their votes. Voting-based consensus mechanisms require a
collection of votes from peers. A vote is a signature appended to a block. F.
BLOCKCHAIN FRAMEWORKS In this section, we review existing blockchain frameworks.
Some are proposed for supply-chain management. We also add others that can be
potentially adopted for the same goal. Table 2 presents a summary of existing
blockchain frame- works. 1) Bitcoin It is a permissionless blockchain framework
that implements a decentralized digital currency system for the exchange of a
cryptocurrency called bitcoin (BTC) [9]. Bitcoin has not been adopted by supply
chain studies covered in this survey, but we introduce it here because it presents
the concept of blockchain. Bitcoin uses the Nakamoto consensus algorithm 234 VOLUME
1, 2020 TABLE 2. Blockchain Frameworks (NCA) [52], which is essential to achieve
decentralization and avoid double-spending in transactions. Double-spending occurs
when a client transfers the ownership of an asset to two or more clients. NCA
comprises a PoW algorithm for the proposal of new blocks, the longest chain policy
as block finality mechanism, and the Gossip protocol for dissemina- tion of blocks.
PoW is a high-intensity computational al- gorithm where miners solve complex
cryptographic puzzles until the required random number is found. PoW demands a high
computational load from miners. From all miners solving the puzzle, the miner that
solves it first is the only one rewarded. Therefore, miners with more computational
power have higher opportunity to first solve the cryptographic puzzle, and to be
rewarded. However, concentration of com- putational power is not desired as it
undermines the decen- tralization principle of blockchain. Ownership transfer of a
BTC is represented by a transaction with a set of inputs and outputs. If a client
wants to transfer his/her BTCs to another participant, the client must define and
sign a transaction that specifies as input the references of the transactions where
VOLUME 1, 2020 235 SHAKHBULATOV ET AL.: HOW BLOCKCHAIN ENHANCES SUPPLY CHAIN
MANAGEMENT: A SURVEY the owned BTCs were obtained, and the identity of the new
owner as the output. Thus, the global state of the distributed ledger in Bitcoin is
simply an abstract representation of the sum of unspent transaction outputs (UTXOs)
of every client. Another drawback of bitcoin, besides having to perform a
computationally-demanding PoW, is that the size of blocks is hardcoded to 1 MB. In
combination with the block generation time, this memory usage keeps the transaction
throughput low. Moreover, the scripting capability of a transaction is limited to
basic operations like Pay-to-Pubkey-hash (P2PKH) and Pay-to-script-hash (P2SH). 2)
Zcash Zcash, while not reportedly adopted in the supply chain stud- ies surveyed in
this paper, it was the first open permission- less cryptocurrency that aims to
fully protect the privacy of transactions. To achieve this goal, Zcash uses ZK-
SNARKs as ZKPs for verification of ownership of tokens [53]. Zcash implements a
consensus algorithm based on Bitcoin’s NCA. However, Zcash uses a lighter version
of PoW, which requires a large amount of memory for solving the cryptographic puz-
zle. The inter-block generation time of Zcash is 2.5 minutes and the block size is
up to 2 MB. Zcash supports public and private transactions, where the latter hides
critical data. The drawbacks of Zcash are poor scalability due to the significant
usage of both memory and time by ZK-SNARKs. 3) Ethereum Ethereum is a
permissionless blockchain framework that im- plements a decentralized digital
currency system for the ex- change of the cryptocurrency known as Ether (ETH) [54].
Ethereum also adopts NCA and a light version of PoW. As a result, the inter-block
(generation) time is reduced to about 15 seconds. Despite this shorter generation
time, low transaction throughput remains in Ethereum. Another modification to NCA
in Ethereum is the integra- tion of the Greediest Heaviest Observed Subtree (GHOST)
protocol that operates in lieu of the longest chain rule as the block finality
mechanism. The state of the distributed ledger is explicitly defined in Ethereum,
as opposed to Bit- coin. Ethereum comprises many small objects called ac- counts,
each of them holding a state, that interact with each other. A major feature of
Ethereum is the support of a com- plete scripting language that leverages the
development of decentralized applications (DAPPs). Smart contracts are im-
plemented through DAPPS. A smart contract runs on an Ethereum virtual machine (EVM)
powered by a unit referred to as gas. This unit is the price charged for every step
of execution in a contract. The EVM is a Quasi-Turing complete virtual machine
intrinsically bounded by gas. The more code a transaction requires to run, the more
gas it requires. The charging of gas helps to restrict the processing of malicious
transactions which aim to run indefinitely [67]. 4) HP3D The hybrid peer-to-peer
physical distribution (HP3D) blockchain framework is proposed for tracking
shipments in a supply chain, and it covers the distribution of products from
suppliers to customers [10], [55]. This framework comprises dynamic private ledgers
for the recording of custody events that are visible to only the trading partners
in a given ship- ment, and a public ledger. HP3D records the activity of shipments
using three types of events, namely genesis, custody, and monitor. A genesis event
is the start of a shipment. This information is broadcast to a private ledger and a
hash of it is broadcast to the public ledger. A custody event is the change of
custody of a product (i.e., ownership). After a change of custody, the new
custodian broadcasts the event to the private ledger and a hash of the event to the
public ledger. In the private ledger, participants validate the signed custody
events, which are subsequently recorded in the private ledger. External monitors
generate monitor events and report them to the public ledger to keep track of the
geolocation of trucks. Any participant in the pub- lic ledger can propose a block
after solving a cryptographic puzzle, i.e., PoW. The proposed block is broadcast
and vali- dated against the participants’ local databases. 5) Gcoin Gcoin is a
permisioned blockchain framework with an open government model, i.e., open data for
transparency and ac- countability, that has been proposed for application in a drug
supply chain [18]. Gcoin uses a double-spending prevention mechanism similar to
that used in Bitcoin. This mechanism
is aimed at countering the trading of counterfeit drugs. Gcoin records the entire
history of a drug; from manufacture to sales. It combines the open government model
and cooper- ation from decentralized autonomous organizations to foster greater
transparency. In this framework, drug manufacturers mine new coins, large
manufacturers, and government agen- cies validate the transactions. Also, third
parties verify and hold the blockchain and pharmacies and consumers perform
transactions to gain ownership of the coins, i.e., drugs. Gcoin also uses a multi-
signature design, supports smarts contracts, and uses PoW with a block generation
time of 15 seconds. This generation time leads to a transaction throughput that
ranges between 17.5 and 26 transactions per second. 6) TransICE TransICE is a
permissioned blockchain framework for the logistics of integrated casinos and
entertainment. TransICE is organized in three layers, the data or blockchain layer,
the smart contract layer whose contracts are based on the Hawk model, and the
interface layer for services and applications. The Hawk model is a decentralized
smart-contract approach that provides transactional privacy guarantees using ZKPs
[57]. A Hawk-based smart contract is split into private and public portions and
both can be executed in Ethereum. Hawk’s 236 VOLUME 1, 2020 security guarantees
include on-chain privacy and contractual security among users in the same contract.
On-chain privacy is achieved because only encrypted data is sent to the blockchain
while the required private computation is performed off-chain. The Hawk protocol is
broken down into three essential stages: commit, compute, and finalize. First,
users commit their data (offer) into the smart contract, then in the compute stage,
the participants reveal their data to a trusted manager who collects all data and
executes a private function in the smart contract. In the finalize stage, the
result of a game is announced and the smart contract distributes the tokens to the
winners who participated in the game as ruled by the smart contract. 7) Multichain
Multichain is a bitcoin-based permissioned blockchain frame- work that leverages
data privacy and scalability by addressing computational-intensive mining, lack of
privacy, and the open accessibility features of current public blockchain
frameworks [58]. It integrates a transactional-based control mechanism for the
management of users’ privileges and permissions. This mechanism defines which
activity is visible to each user, which transactions are considered valid, the
block size, mining participation, mining rewards, and transaction fees. Similar to
bitcoin, transactions in Multichain are input-output based but they differ in that
they contain special metadata, such as communicating users’ granted or revoked
permis- sions. Mining in Multichain avoids monopolization of the block proposing
mechanism by a powerful single node through the use of a round-robin schedule where
nodes take turns to propose a block. In its current version (2.0), Multichain
provides smart filters, which are pieces of code embedded in the blockchain,
containing rules to validate transactions and to restrict the data visibility for
users according to their permissions. In Multichain, administrator nodes grant
partic- ipants the right to participate in the consensus algorithm and to retrieve
the contents of the distributed ledger. They restrict access to the distributed
ledger, and that enhances data privacy and confidentiality. Multichain can also
work as a compound blockchain node to communicate with other frameworks by simply
setting the connection parameters in its configuration file. 8) Hyperledger
Sawtooth Hyperledger Sawtooth is a blockchain framework supported by Intel, which
works as either a permissioned or a permis- sionless blockchain [59]. This
framework implements ETH smart contracts via a tool called Seth and provides data
privacy by means of private UTXOs. It uses Proof of Elapsed Time (PoET) as its
consensus algorithm. PoET simulates the time used for PoW in a trusted execution
environment (TEE) using software guard extensions (SGXs) enclaves [68]. A node with
the shortest waiting time becomes the proposer. 9) Hyperledger Fabric Hyperledger
Fabric is a permissioned blockchain framework supported by IBM, which is primarily
used for enterprise solu- tions [60]. Hyperledger Fabric follows a modular design
that allows the integration of pluggable modules for its different infrastructure
components (e.g., consensus algorithms). By default, it comes with built-in FTC
algorithms namely, Kafka and Raft; and a centralized consensus algorithm namely
Solo for development purposes. However, user-defined consensus algorithms can be
plug-and-play when needed. Fabric sup- ports chaincodes similar to ETH smart
contracts. A major difference between Hyperledger and other blockchains is that
Hyperledger provides enhanced data pri- vacy by incorporating private channels,
ZKPs, and using en- dorsement policies. An endorsement policy defines the num- ber
of validators required to validate a transaction. An en- dorsement policy can be
defined at the contract or at the data level. Hyperledger Fabric follows an
Execute-Order-Commit model, in which transactions are initially executed on the set
of validators defined in the endorsement policy. This approach improves scalability
by reducing inter-block generation time, prevents non-determinism in contract code,
and enables the private execution of transactions between a set of participants.
Scalability of Hyperledger Fabric also depends on how fast the hardware of the
involved peers executes the validation pipeline of transactions. Optimized
transaction throughput from 3,000 to 20,000 tps has been reported [69]. 10)
Tendermint Tendermint is a blockchain framework that runs the Tender- mint
consensus algorithm which is a BFT-based PoS consen- sus algorithm [61]. This
algorithm works as a voting mech- anism that runs in consensus cycles, each having
multiple rounds. Every round consists of three steps, propose, prevote, and
precommit. The function that selects a validator as the proposer of a new block is
deterministic. A node is selected as a proposer with a weight proportional to the
node’s tokens; the higher the stake, the larger the probability that the validator
is selected as the block proposer. A block is finalized and appended to the main
chain after validators have received more than two thirds of the votes from the
total set of valida- tors. Tendermint is a flexible consensus algorithm that can be
implemented in permissionless or permissioned blockchains. Tendermint can provide a
high throughput because it has an unbounded block proposal time. However, the block
proposal time depends on a node receiving the minimum number of votes to reach
consensus. The number of participants, how- ever, may affect the block proposal
time. 11) Exonum Exonum is a framework that provides the building blocks for the
development of a permissioned blockchain [62]. Exonum uses a customized BFT
consensus algorithm that is similar to Tendermint but it works in unbounded rounds,
i.e., a round VOLUME 1, 2020 237 SHAKHBULATOV ET AL.: HOW BLOCKCHAIN ENHANCES
SUPPLY CHAIN MANAGEMENT: A SURVEY is the proposal of one block. Every round
consists of three stages: propose, prevote, and precommit. In the propose stage, a
selected leader proposes a list of transaction hashes and broadcasts it to the
validators. Upon receiving the list, val- idators verify that the transactions in
the list are consistent and broadcast a prevote for the received list. Then,
validators collect two thirds of prevotes and process the transactions in the list.
The validator that receives two thirds of the prevotes broadcasts the results to
the other validators in a precommit message. If a validator receives two thirds of
precommits, they commit the block to their local ledger. Exonum provides ser-
vices, which are analogous to ETH smart contracts. It also has special features
such as locks to keep the consensus algorithm off the influence of byzantine
validators. 12) BigchainDB BigchainDB is a permissioned blockchain framework that
combines the decentralization, immutability, and owner- controlled assets
properties of a blockchain with a high trans- action throughput, low delay, and the
indexing and query capabilities of a database. BigchainDB aims to resolve the
single-point of failure scheme of master-replica database envi- ronments.
Additionally, it uses Tendermint’s consensus algo- rithm to synchronize the network
peers, but it provides equal voting power to nodes. Therefore, BigchainDB inherits
the low latency, fast finality, and BFT from Tendermint. 13) Double Chain Double
chain is a permissionless blockchain framework de- signed for agricultural supply
chains [64]. It aims to match and schedule decentralized agricultural commercial
resources between suppliers and consumers using a transparent and credible
management model. Participants in double chain are supply and demand nodes and they
report their supply ca- pacities and demands to a public centralized service
platform that matches the participants. Double chain is based on two independent
chains, the user information chain that records the hash of participants’ public
keys and the transaction chain that records the performed transactions between
participants. The public service platform performs virtual integration of the
reported decentralized agricultural resources. Intelligent contracts control the
execution of a transaction and are gener- ated after the public service platform
implements an adaptive matching service to match the reported supplies and demands.
To improve transaction throughput, Double chain uses a PoS- based consensus
algorithm. 14) Carbon Footprint Chain Carbon Footprint Chain (CFC) is a cluster-
based blockchain
framework for recording the carbon footprint generated by the transportation of
products between the stages of a food supply chain. This blockchain framework has
as many clusters as the number of stages of a supply chain, each representing a
food life-cycle stage (farm, processing, manufacturing, etc.). A cluster is a group
of full nodes, or participants, in a stage. IoT devices integrated into trucks
collect the mileage, carbon footprint, product, and other information needed to
associate the transportation with the generated amount of carbon. As a truck
arrives at a new stage, the IoT device publishes in- formation to the closest node
in that stage. The leader node of the cluster validates the block and broadcasts
the block to every node. Each node then writes the block onto its local ledger. CFC
implements a Raft-like consensus algorithm in each cluster, where a leader node in
the cluster communicates with a random node of a previous cluster to validate the
block. This process ensures that trucks in the supply chain record accurate
generated carbon for each trip. 15) Block-Supply Chain Block-supply chain is a
blockchain framework designed to de- tect counterfeits throughout the product life
cycle of a supply chain [65]. It integrates RFID and near field communication (NFC)
technologies to detect modification, cloning and tag reapplication of products at
different stages along the supply chain. Block-supply chain aims to address a
centralized anti- counterfeit problem where a trusted server is responsible for the
management and coordination of product authentication. Block-supply chain
implements a Tendermint-based consen- sus algorithm but it customizes it to improve
its performance at the cost of security. Block-supply chain’s consensus algo- rithm
reduces the number of required validators from n − 1 to log(n − 1) and implements
an equal-selection random al- gorithm to select validators every time a new block
is pro- posed. It comprises two phases: Initialization and verification. In the
initialization phase, the product manufacturer records the detailed information of
a product on the product’s NFC tag, generates an authenticated event, and
broadcasts it as a genesis block. In the verification phase, the supply chain nodes
execute a local and a global authentication algorithm to verify the authenticity of
the product’s information in the block and reach consensus. 16) QuarkChain
QuarkChain is a blockchain framework that aims to ad- dress the limited transaction
throughput of permissionless blockchains [66]. QuarkChain is based on the concept
of horizontal scalability or sharding, in which the global state of the blockchain
is partitioned into multiple sub-states (i.e., sharded blockchains). Every shard
runs in parallel and is inde- pendently processed; by increasing the number of
shards, the transaction throughput is linearly increased. In QuarkChain, there are
two types of transactions: balance transfer transac- tions that can be either in-
shard or cross-shard and smart con- tract transactions, which are valid only if
they are issued from within the same shards. QuarkChain runs two hierarchical
layers namely the sharding blockchain layer, which consists of a list of sharded
blockchains, each having their consen- sus and sharded-parameters, and the root
chain layer. The latter layer is in charge to confirm the blocks in the sharded
blockchains. A block in the root chain layer includes the 238 VOLUME 1, 2020 TABLE
3. Blockchain Frameworks and Supply Chain by Industry and Challenges block headers
of the sharded-blockchain blocks. QuarkChain implements a two-layer sharding
consensus algorithm, called Boson. An example is a collaborative mining/minting
con- sensus algorithm, where the root chain layer runs PoW while the sharding
blockchain layer runs PoS. It has been reported that QuarkChain can reach more than
55,000 transactions per seconds with 1,024 shards [70]. IV. BLOCKCHAIN AND SUPPLY
CHAIN MANAGEMENT Supply chain management covers multiple stages of a product life
cycle and often involves the participation of various stake- holders. The multiple
stages and the variety of participants in the supply chain make it a highly
interconnected network that is difficult to manage. Furthermore, supply chain
management is challenged not only by the requirements on record-keeping but also by
the requirements associated with a particular in- dustry. In response, different
blockchain frameworks and con- sensus algorithms have been proposed to address
concerns in specific industries and products. Table 3 summarizes the blockchain
frameworks for supply chain covered in this sur- vey, categorized by industry, and
outlines the objectives that motivated the adoption of blockchain. A.
INDUSTRIES/PRODUCTS Because food supply chains are essential for society, they have
attracted more interest in applying blockchain technology in this industry than any
other ones. Some of the addressed challenges are transparency, provenance, per-
formance improvement, quality assurance and control, and achieving sustainability
[11]–[17], [21], [22], [47], [64], [71]– [80]. Food supply chains comprise many
stages and they may not be finely monitored and tracked. As a result, end con-
sumers are usually unable to trace their food products’ origins. Counterfeit drugs
are a common challenge for the pharma- ceutical industry. Recent studies in this
industry show the ef- fectiveness of blockchain in tracking and authenticating
drugs [18], [27], [81]–[83]. The health industry has also explored the use of
blockchain to secure digital records [30]. Some other challenges explored in the
pharmaceutical industry include quality assurance and quality control [84], and
performance improvement [85]. The entertainment and media industry faces
transparency challenges in its supply chain because stakeholders need to be assured
of the quality of service and compliance of regu- lations. The complexity of this
industry is due to not only the size of operations but also to the vast number of
regulations. The integrated casinos and entertainment (ICE) logistics in- volve
management of other industries such as tourism, hotel, retail, etc. It is important
for ICE logistics to ensure that each participant of the supply chain provides
goods and ser- vices meeting the quality standards set by the industry or the
customers’ demand. Blockchain is a fit candidate to resolve VOLUME 1, 2020 239
SHAKHBULATOV ET AL.: HOW BLOCKCHAIN ENHANCES SUPPLY CHAIN MANAGEMENT: A SURVEY this
challenge because it ensures that all transactions within the network are
transparent and easy to identify, track, and manage [56]. Automotive, wine, and
wood products share the challenge on provenance. In these industries, provenance
and origi- nality are the main motivation of using a distributed ledger [11], [20],
[86]. They are mostly interested in permissioned blockchain frameworks to keep the
companies’ proprietary information confidential. Blockchain is also a very suitable
solution to track own- ership of digital assets, such as 3D models [19].
Intellectual property of digital assets is very challenging to track because these
products are highly replicable. Association of these as- sets with blockchain needs
further research. Postage is an industry that considers blockchain for its supply
chain to detect counterfeit stamps as the number of fraud cases continues to
increase [87]. Adversaries may take advantage of the variation of currency and
counterfeit old stamps. This work mentioned that the lack of expiration date of
stamps increases the complexity of the challenge. The low- cost of stamps and their
large numbers make stamp verifica- tion hardly cost effective and scalable. Some
studies provide blockchain solutions to address trans- parency, provenance, quality
assurance and control, data pri- vacy, confidentiality and sustainability in
general supply chain without specifying the industry [10], [65], [88]–[101]. These
works aim to provide a general solution to all supply chains by leveraging the
features of blockchain. However, other works focus on a specific industry and also
on particular challenges.
Since its creation in 1990, companies are using the World Wide Web to exchange
information. The revolutionary system opened the doors for the business
productivity improvement and competitiveness. Nowadays, new technologies like the
ones applied in social media, machine learning, robotic process automation, and
blockchain are improving the business environment and bringing a large way to
exchange information One of the newcomers is blockchain. Initially, blockchain was
focused on money exchange. Bitcoin, the electronic money exchange created by
Satoshi Nakamoto (2008) opened the possibility to send and receive money without
any financial intermediary. The “peer-to-peer electronic cash system” (Nakamoto,
2008), sends payments from one peer to other through a very high safety model using
data encrypted that cannot be modified. Blockchain has grown in popularity due to
its characteristic features such as immutability, incorruptible and the capability
to enable absolute transactional transparency. It is no doubt that blockchain has
the power to transform every aspect of the logistics and supply chain industry.
Currently, developments are underway to ensure that blockchain systems will be able
to work in tandem with data drawn from IoT devices used in logistics and supply
chain. The inefficiencies of the current data exchange systems and the trust of the
information allow the identification of the value of blockchain in supply chain
management. The opportunity of paperless bureaucracy and cost reduction accelerate
the identification of the new challenges. Unlike traditional centralized database
systems, blockchain validates the data in the ledger using a cryptographic
consensus mechanism. The proposal of blockchain is to encourage trust across peers
and create safety networks to exchange information. It means no authority or
participant can control or manipulate what is recorded by blockchain technology
(Mougayar,2016). The transparency was initially considered as the important aspect
of adopting the technology, as well as improving the data exchange, disrupting the
traditional way of sending and receiving information. Another important feature
clearly recognized is the speed of transactions that also contribute to reduce
costs. There is also a growing trend of consumers demanding information about the
provenance of products. The facilities identified in Blockchain are quickly adapted
to supply chain operations, mainly due to the product traceability. One of the best
examples is the food chain, where the customer can be confident about the
authenticity of goods, including the environmental impacts and workers conditions
during the entire production process (Kshetri, 2018). Other examples are medicine
and cosmetics, where blockchain improves the value percept from the customer side
and give better business results (Aptea & Petrovskyb, 2016). Other benefits already
identified include the simplification of the settlement of claims, increasing
transaction security, accelerating payments and reducing fraud, reducing the cost
of compliance and regulatory requirements, elimination intermediaries thereby
cutting costs and improving tracking of items throughout the supply chain. To
support blockchain implementation in logistic and supply chain management, a smart
contract is required. A smart contract is a condition of the operation written on a
code. The smart contract automatically executes the transactions and record the
information onto the ledger without any human intervention. The aim of smart
contracts is to provide security, which is superior to traditional contract law and
to reduce other transaction costs associated with contracting (Tapscott 2016: 105-
108). Buterin explains it as: “ then we can cut costs to near-zero with a smart
contract.” (Parker 2016). Networked members mutually agree on the smart contract.
It is a key component for establishing trust and efficiency between parties. Smart
contract eliminates all the paperwork, streamlining the entire process and saving
time and money. The scope of this paper is restricted to discuss the blockchain
application to the supply chain world and the benefits that can be obtained in such
application. It is not an intention of this paper to evaluate the blockchain
technology and the different kinds of software used for its implementation. 2.
Definition of supply chain Lummuns and Albert (1997) conceptualize the supply chain
as a network of entities in which material flows. Those entities may include
different suppliers, transformers or processors, distribution center, retailers and
final customers. According to Slack et al. (1999), a set of interconnected
companies whose function is to supply goods and services to a company or to final
customers is called "supply chain" (Slack et at., 1999). The general idea behind
supply chain management (SCM) is to manage the flow of goods, services, and
information in an effective way in order to achieve high performance and decrease
risks (Tan, 2001). On the other hand, Christopher (1997) defines supply chain as
the set composed by a particular leader company and all the other companies with
whom they interact, directly or indirectly, through its suppliers and customers,
upstream and downstream, that is, from the point of origin of the basic materials
and/or services, to the point of effective consumption of the products and/or
services. There are billions of products being manufactured every day globally,
through complex supply chains that extend to all parts of the world. However, there
is very little knowledge of how, when and where these products were originated,
manufactured, and used through their life cycle. Even before reaching the end
consumer, goods travel through an often-vast network of retailers, distributors,
transporters, storage facilities, and suppliers that participate in the design,
production, delivery, and sales, yet in almost every case these journeys remain an
unseen dimension of our possessions. (Jessi, et al., 2016) Day by day, supply
chains are getting increasingly more complex, more extended, and more global. An
event on one side of the world can stop the production or delivery of a service on
the other side. The event may be a natural or man-made cause, the event may be
large or small, but if the supply of a critical component or service is disrupted,
the consequences can be severely harmful to companies further along the supply
chain, both financially and in terms of reputation (Punter, 2013). 3. What is
Blockchain? Blockchain, the technology underlying bitcoin, is a type of Distributed
Ledger Technology that has been defined as a "distributed, shared, encrypted
database that serves as an irreversible and incorruptible repository of
information" (Wright, 2017). Nakamoto (2008) argued that bitcoin is a peer-to-peer
electronic cash system: "A pure version about peer-to-peer electronic cash exchange
that allows online payments from one side to other without any financial
institution". According to DTCC (2016), blockchain is both the network and
database, secure and integrate. The blockchain is able to build the transactions
based on rules defined mathematically and enforced mechanically. A technical
definition based on Linux Foundation is a peer-to-peer distributed ledger forged by
consensus, combined with a system for "smart contracts" and other assistive
technologies." Mougayar (2016) argue that blockchain is a kind of technology that
can record transactions in a secure and permanent way. It can save the all history
of the transaction without any risk. It is a networking technology, similar to
world-wide-web (www) that enables a decentralized exchange of data. In a wider
sense, blockchain is a distributed database (ledger), which maintains a
continuously growing list of timestamped and encrypted transaction records
organized in blocks, with each block being linked to a previous block, forming an
overview of the overview adapted on the figure 1 by Abeyratne & Monfarej 2016).
Figure 1: Overview of the proposed concept, adapted from Abeyratne & Monfared, 2016
4. What is behind blockchain? Mougayar (2016) also argues that smart contract is
the key technology that allows Blockchain application on several businesses. It is
a contract between parties that is coded and uploaded to the blockchain. The smart
contract does not rely on the third party authorities. All processes in dealing
with such contracts are automatically controlled. The clauses of a contract are
executed after all parties have accomplished their duties. This function removes
all ambiguity regarding the execution of contract conditions concerning the
existence of external dependencies. Smart contracts are simply computer programs
that execute predefined actions when certain conditions within the system are met.
According to Kakavand et al., (2016): "Smart contracts may make the negotiation
process and performance of a contract easier and more efficient. Usually, the
interface of a smart contract is clear and it imitates the logic of contractual
clauses. The main aim is to secure the contractual processes and reduce the cost
related to contracting". Swan (2015) describe a smart contract as one of the main
features of blockchain that enabling "trustless" transactions. This type of
transaction defines as validated, monitored and bilaterally enforced transactions
over a digital network. Smart contracts can incorporate multiple digital signatures
for necessary approval of participants. If the conditions of a smart contract
depend upon real-world data, systems called "oracles" can be implemented to monitor
and verify this data. Smart contracts are simply computer programs that execute
predefined actions when certain conditions within the system are met. Smart
contracts provide the language of transactions that allow the ledger state to be
modified. They
can facilitate the exchange and transfer of anything of value (e.g. shares, money,
content, property). The smart contract is signed by the parts to create a
transaction and place them into a block that will be saved immutably into the
Blockchain ledger on figure 2 by Szabo (1996) Figure 2: Blockchain and Smart
Contract - adapted from Szabo (1996) As the terms of a Smart Contract are executed
during a transaction, the blocks are created per the agreed upon business rules,
and the chain is constructed. Of particular importance, each block is digitally
verified against the clauses in a Smart Contract, thus assuring the sharing of, and
visibility into what becomes a "single version of the truth." (Amber Road, 2018)
Smart Contracts truly are the driving force behind blockchain for supply chain
because the business rules they contain are what assures that actual transaction
are carried out pursuant to the original agreement. Whether a Smart Contract
represents a product licensing agreement, bill of material requirements or some
other agreement between the parties, the sequencing of blocks in a transaction can
only take place if a given step in the process is consistent with the Smart
Contract. According to Linux Foundation (2018), a smart contract can be provided:
a. Autonomy: can be developed by anyone, no need intermediaries such as lawyer,
brokers or auditors b. Efficiency: removing process intermediaries often results in
significant process efficiency gains c. Backup: a Blockchain and smart contract
deployed to it can provide a permanent record, allowing for auditing, insight, and
traceability even if the creator is no longer in business d. Accuracy: replacing
human intermediaries with executable code ensures the process will always be
performed the same e. Cost saving: replacing intermediaries often provides
significant cost reduction 5. Applicability of Blockchain in supply chain The
Blockchain Trust Accelerator (2018) understands that blockchain is well suited for
use in supply chains in part because the technology has the potential to provide an
unprecedented level of transparency. Unlike traditional centralized databases,
Blockchain systems validate entries or changes in the ledger through a
cryptographic consensus mechanism, thereby circumventing the need for
intermediaries. This enables otherwise trust-less parties, such as individuals and
firms that do not know each other, to engage in near frictionless peer-to-peer
transactions. According to Kshetri (2018), blockchain applications are further
explained as a solution for trust issues in supply chains. Enthusiasts of the
decentralized application are therefore promoting an early adoption of the
technology for companies to stay competitive in the market. Multiple companies such
as Maersk (Jackson, 2017) and Walmart in cooperation with IBM (Popper & Lohr, 2017)
have started to plan the implementation of the technology by creating pilot
projects to achieve the benefits of the technology already at an early stage.
Furthermore, both Walmart and Maersk, have assured that a full version will be
ready to implement in the organizational operations in the near future (Popper &
Lohr, 2017). In the field of logistics, researchers see many possibilities for the
blockchain technology to improve for instance track, trace, and quality measurement
solutions. An example of a supply chain system can be demonstrated in the figure
below, where several kinds of information can be saved into Blockchain structure
support by smart contract (Gupta, 2018). According to Kshetri (2018), blockchain
applications are further explained as a solution for trust issues in supply chains.
Enthusiasts of the decentralized application are therefore promoting an early
adoption of the technology for companies to stay competitive in the market. The
figure 3 demonstrate an example of Blockchain applied on supply chain management to
track the product from the “farm to fork”, including examples of information added
on the smart contract and Blockchain recorded. Figure 3: Adapted from Harnessing
Blockchain in the SCM & Logistics Space - Gupta (2018) In general, the development
and implementation of blockchain solutions in supply chains are still at an early
stage. Thus, there are many opportunities for companies in the future when the
technology is further developed (Nowiński & Kozma, 2017). Particularly for the
improvement of collaboration between supply chain partners, the blockchain
technology could offer different solutions. Depending on context, different
definitions of traceability exist from organizations, legislation or researchers
(Aung and Chang, 2014). In a study on different traceability definitions, Olsen and
Borit (2013) conclude, "even in scientific papers there is a lot of confusion and
inconsistency" regarding the definition of traceability. The researchers' study
shows that scientific papers often use the ISO definition of traceability, and the
most commonly cited definition from academic sources is the definition from Moe
(1998) (Olsen and Borit, 2013). Besides the adoption of this technology in powering
cryptocurrency networks, there are open questions about where blockchain is headed,
when it will yield positive results, and who will benefit the most from it. What is
clear at this point is that blockchain applications may have one of the most
profound impacts on the logistics industry, especially the supply chain. Vipul
Goyal (2018), an associate professor at Carnegie Mellon University, states: "A lot
of companies are interested in blockchain for creating more efficient workflows,
but supply chain management is one of the big killer apps". Awaysheh & Klassen
(2010) identify transparency as the extent to which information is readily
available to both counterparties in an exchange and to outside observers. In a
supply chain context, transparency refers to information available to companies
involved in a supply network. Supply chain traceability leverages transparency to
operationalize organizational goals related to raw material origins and provide
context to a final product or service. Blockchain technologies indeed provide
increased supply chain transparency but more importantly create an immutable and
distributed aspect of the custody record by nature of the protocol, which lends
itself well to traceability applications. A very good opportunity to control the
inventory was presented during Blockchain Summit in April 26 th., in San Francisco
by Ernst Young (EY), where they demonstrated how the visibility of inventory can be
improved on supply chain management. The supply chain operations efficiency impacts
an organization’s competitiveness and is shaped by numerous factors. Information
sharing methodologies such as vendor managed inventory (VMI) create efficient
replenishment models without the need for traditional orders (Småros et al., 2003).
In theory, the blockchain can work, but supply chains are very hard to change and
adapt (Mougayar, 2016). Mougayar thinks, that companies spend years putting supply
chains in place and refining them. It is not very easy to insert a new technology
inside established supply chain systems because the integration challenges are not
to be underestimated." (Mougayar, 2016).
Supply chains are becoming increasingly heterogeneous and complicated due to a
growing need for inter- and intra-organizational connectedness, which is enabled by
advances in modern technologies and tightly coupled business processes [1,2]. To
cope with this dynamic environment and the increasing need to digitize supply
chains and enhance competitiveness, companies are applying novel technologies such
as the Internet of Things (IoT), cloud computing, business analytics, artificial
intelligence, machine learning, and Blockchain technology [3–5], as well as
innovative concepts such as the so-called physical Internet [6]. The multiplicity
of technologies, which are often simultaneously introduced, along with the ubiquity
of connected devices, often labeled as ‘smart’ devices or things, allow value chain
exchange (or trading) partners to reach new levels of effectiveness and efficiency
[7]. These technologies promise to reshape the modus operandi of modern supply
chains through enhanced data collection as well as information sharing and analysis
between collaborating supply chain stakeholders [8]. Moreover, they enhance
information transparency, leading to increased trust between the exchange partners
[9,10]. The impact of these technologies on supply chains constitutes a research
gap that is relevant for both practitioners and academics. IoT is defined as a
“group of infrastructures interconnecting connected objects and allowing their
management, data mining and the access to data they generate” [11] (p. 73). It
embodies the next phase Future Internet 2019, 11, 161; doi:10.3390/fi11070161
www.mdpi.com/journal/futureinternet Future Internet 2019, 11, 161 2 of 22 toward
mass digitization of supply chains to facilitate the so-called Industry 4.0 [12].
IoT encompasses devices such as sensors as well as passive, semi-passive (or semi-
active), and active Radio Frequency ID tags (RFID), and other electronics which are
connected over a network. Together, these technologies can perform numerous tasks,
including functions such as sensing activity, movement, or temperature; actuating
and collecting; processing, storing, and sharing data. For example, the food supply
chain is particularly sensitive to environmental conditions during transportation
and storage, such as light, humidity and temperature [13]. In the cold chain, time-
temperature measurements with sensor devices connected to a wireless sensor network
(WSN) can help to preserve the quality and safety of a food product and reduce the
risk of spoilage [14]. WSNs represent a network or system of connected sensors
which communicate to a base station through mobile networks such as 4G or GPRS
(General Packet Radio Service) and informs supply chain exchange partners in real-
time [14]. When the information is received, it can trigger an acceptance or
rejection of the shipment based on the temperature parameters preset in a smart
contract, which in turn can trigger payment if accepted. Moreover, when IoT-enabled
sensor devices connected to a WSN provide time-temperature alerts on a real-time
basis, an out of tolerance measurement (or a predictive out of tolerance
measurement) can trigger a mid-shipment corrective action and intervention by the
driver or shipper [8,9]. The growing economic importance of IoT reflects in its
steadily increasing industry adoption. With the convergence of information and
communication technologies (ICT) and machine automation, the use of IoT has become
more pervasive, especially in supply chains and logistics. This trend is
attributable to increased computational power and decreased costs of the connected
devices. The International Data Corporation (IDC) forecasts that by 2021, 20% of
the largest (G2000) manufacturers will depend on a secure infrastructure backbone
of embedded intelligence to automate large-scale processes and enhance the speed of
process execution by up to 25%. This backbone will mainly depend on IoT for
enabling controls and actuators to take autonomous decisions [15]. In 2017, there
was an estimated 5 billion IoT enabled devices, and this number is expected to
reach 29 billion by 2022 [16]. Global connectivity will contribute further to new
economic opportunities and business growth that may generate an additional USD 14
trillion in the global economy by 2030 [17]. Various researchers identified supply
chains and logistics as essential areas for deploying IoT [18,19]. IoT can improve
supply chain competitiveness through more effective tracking of the flow of
materials, leading to improvements in the effectiveness and efficiencies of
critical processes and timetables [20]. Within multi-exchange party supply chains,
IoT can help to facilitate the sharing of more precise and timely information
related to production, quality assurance, distribution and logistics [21–23].
Hofmann and Rüsch [24] posited an integrated solution for a Just-in-Time (JIT)
production line where RFID tags act to trigger an alert when a specific station is
empty. This warning signal notifies the supplier to replenish and deliver the stock
directly to the specific station. Moreover, the use of IoT applications inside the
production plant can increase the visibility of parts and processes, and by
extension, using IoT devices along the supply chain can help to boost productivity,
reduce operational costs, and enhance customer satisfaction [25]. Despite the
growing potential to apply IoT in supply chains, there are numerous challenges
ahead. For instance, IoT-related technical issues experienced when operating at the
ecosystem level, such as security, authenticity, confidentiality, and privacy of
all stakeholders [26]. From an IoT vulnerability perspective, practitioners and
scholars consider security to be the most critical issue [27–29]. Existing security
solutions are not well suited because current IoT devices may consume significant
amounts of energy and may have significant processing overhead [30]. Moreover,
problems such as counterfeiting, physical tampering, hacking, and data theft might
raise trust concerns among supply chain exchange partners [31]. Tzounis et al. [26]
(p. 42) therefore conclude that “IoT must be secure against external attacks, in
the perception layer, secure the aggregation of data in the network layer and offer
specific guarantees that only authorized entities can access and modify data in the
application layer”. Necessary safeguards must be developed to leverage the value
and enhance the trust of connected IoT devices in supply chains. For instance,
Blockchain technology now offers several potential solutions Future Internet 2019,
11, 161 3 of 22 to address known issues related to IoT. A Blockchain is a
distributed network for orchestrating transactions‚ value‚ and assets between
peers‚ without the assistance of intermediaries [32]. It is also commonly referred
to as a ‘ledger’ that records transactions [33]. Another way to view a particular
Blockchain is as a configuration of multiple technologies‚ tools and methods that
address specific problems or use cases [8]. With the adopting of Blockchain
technology, companies aim to enhance information transparency and improve trust in
their supply chains while supporting the interoperability among the networked
supply chain exchange partners. Blockchain technology has the potential to address
several known supply chain issues [34]. As a result, it has gained considerable
attention from scholars, firms, and technology developers who seek to combine IoT
with other technologies [35,36]. Currently, supply chains are undergoing an
evolutionary change through continued digitization. They are evolving into value-
creating networks where the value chain itself turns into a vital source of
competitive advantage. At the same time, developments are in progress to integrate
Blockchain technology with IoT solutions, leading to novel structures of modern
supply chains‚ new partnerships, as well as new ways of collaboration and value
creation across supply networks [37]. In this paper, we explore how companies can
leverage IoT in combination with Blockchain technology to streamline their supply
chains and value-creating networks. When combined‚ these enabling technologies will
help firms to overcome problems related to data acquisition and integrity, address
security challenges‚ mitigate traceability concerns, and reduce information
asymmetry. In the following section, we review IoT in the context of supply chain
usage and present various benefits and vulnerabilities. Subsequently, we discuss
the critical role of Blockchain technology in leveraging IoT-based supply chain
applications. In the final section, we make some concluding remarks and present
suggestions for future research. The propositions that we derive in this paper
extend existing academic literature by providing a structured foundation for
systematic research that investigates the combined impact of IoT and Blockchain
technology on modern supply chains.
This paper reviews the existing literature on blockchain technology, present some
trends and consider its potential in supply chain management (SCM). Blockchain
technology is claimed to be one of the most important and innovative technologies
developed in recent years (Peters and Panayi, 2015; Pilkington, 2016; PWC, 2015;
Swan, 2015). Blockchain is evolving from a secure monetary transaction system into
a part of an ecosystem of emerging technologies that include artificial
intelligence (AI), the Internet of Things (IoT), robotics and crowdsourcing, among
others. Together, these technologies represent the technical foundation of the
future of business activities (Deloitte, 2016; Dorri et al., 2016; Ferrer, 2016;
Omohundro, 2014). The technical foundation of blockchain supports various
businesses such as banking, trading, insurance, data protection, voting,
intellectual property, identity authentication, leasing and government service
(Atzori, 2017; de Meijer, 2016; Hope and Casey, 2015; Liebenau and Elaluf-
Calderwood, 2016; Peters and Panayi, 2015; Swan, 2015; Trautman, 2016; Yermack,
2017; Zyskind et al., 2015). The functions of blockchain technology, such as
protecting data integrity, instant sharing of the necessary information, as well as
programmable and automatic controls of processes, are likely to disrupt the
existing ecosystem by eliminating the need for many manual processes and
intermediaries. The WEF (2015) has characterized blockchain as one of the six
megatrends in computing likely International Journal of Physical Distribution &
Logistics Management Vol. 49 No. 9, 2019 pp. 881-900 © Emerald Publishing Limited
0960-0035 DOI 10.1108/IJPDLM-11-2018-0371 Received 8 November 2018 Revised 13 March
2019 16 June 2019 Accepted 10 July 2019 The current issue and full text archive of
this journal is available on Emerald Insight at: www.emeraldinsight.com/0960-
0035.htm 881 Potential of blockchain technology in SCM to shape the world in the
next decade. Blockchain technology is considered to be the biggest innovation in
computer technology (Tapscott, 2017). Blockchain technology helps avoid conflicts
that occur when multiple modifications are made simultaneously from different
computers within a distributed database (Peters and Panayi, 2015). Distributed
databases are comparable to blockchains as both systems rely on multiple computers
for operations and for maintenance procedures. Global trade relies on physical
documents such as letters of credit (LC) and intermediaries involved in such
activities ensure smooth functioning of trade. Blockchain technology is likely to
transform the global supply chain platform by eliminating intermediaries/brokers
and the process of physical verification of documents. One of the primary
objectives of SCM is to reduce risk. Relational risks in collaboration is a major
risk where a business partner engages in distorting information for an opportunity
(Bettis and Mahajan, 1985; Thomas and Baird, 1990). Logistics services often play a
key role in a firm’s ability to deliver value to customers (Mentzer et al., 2001).
Blockchain technology is expected to provide value to SCM in three areas: smart
contracts, supply chain finance, and increased visibility and traceability of a
supply chain (Kshetri, 2018). This paper reviews articles published through the end
of December 2018 to identify sectors/industries where blockchain technology has
been used or has the potential to be useful. The analysis considered the frequency
of keywords used, journals that published such articles, disciplines covering
research and industries where it has been adopted or are in the process of being
adopted. The remainder of the paper is organized as follows: the second section
presents a review of the relevant literature on blockchain technology. The third
section discusses the motivation behind this research and presents the key research
questions discussed in the study. The fourth section provides analyses and is
followed by implications for SCM professionals in the fifth section. The sixth
section concludes the discussion. Literature review The literature review is
divided into six sub-sections. The first talks about the genesis of blockchain
technology, the second covers blockchain technology itself. The third sub-section
discusses the significance of blockchain technology and the fourth discusses the
applications of blockchain technology. The fifth sub-section explains the smart
contract and the last sub-section illuminates the key role of blockchain technology
in SCM, and its importance and usefulness in business. Genesis The first known
experiments with Cryptocurrencies occurred in the Netherlands in the mid-1980s.
However, Cryptocurrencies became better known with the introduction of bitcoin in
2008. This was the brainchild of someone who published it in the pseudonym of
Nakamoto (2008) and has not been identified yet (Fiorillo, 2018). A user wishing to
participate in the bitcoin network must download and install the bitcoin core
client (Farghaly, 2014). A bitcoin client sets the user’s computer up as a node on
the network. Network discovery is an important role performed by each node.
Finally, each node becomes a block into the public ledger and a series of nodes
from blockchain (Meiklejohn et al., 2013). The data structure of bitcoin’s ledger
is borrowed with minimal modifications from a paper written by Haber and Stornetta
(1997). The origin of blockchain can be traced back to the 1990s when there was a
need to time stamp every digital transaction to avoid tampering with documents.
Haber and Stornetta (1991) addressed the problem of time stamping of documents by
building a “digital notary.” Bitcoin borrowed the data structure from Haber, and
Stornetta and re-engineered its security properties. Later, Bayer et al. (1993)
highlighted that links created between documents using hash pointers are simpler
and faster to compare with multiple other documents. Incidentally, Benaloh and Mare
(1991) independently introduced these same three ideas shortly before the Haber and
Stornetta (1997) paper. 882 IJPDLM 49,9 Blockchain technology Blockchain technology
distributes the storage, organization and verification of hash pointers to a group
of computers as opposed to storing them in a central database of an enterprise
resource planning (ERP) system. This mechanism reduces the risk of failure at a
single point (Peters and Panayi, 2015). The blockchain functions as a layer
supplementing existing ERP software. For example, provenance is a digital
enterprise platform that allows businesses to make their products and supply chains
more transparent and traceable through blockchain technology since 2013. It helps
businesses to be transparent on three levels: business level, product level and
item level. Provenance (2015) enables businesses to easily collate data, open data
and verify key information on an immutable data ledger. “Provenance has completed a
six month pilot for tracking responsible sourcing of tuna in Indonesia via
blockchain” (Laaper and Fitzgerald, 2017). A blockchain is a chain of
interconnected encrypted blocks. Creating a block is like writing with a marking
pen and distributing the pieces like a jigsaw puzzle, which cannot be altered or
deleted without breaking the chain on a network. A blockchain is designed to
operate with little human intervention, unlike an ERP or database system that
requires intensive human effort (Peters and Panayi, 2015; Swan, 2015). Blockchains
have evolved in three phases since 2009 in Phases 1.0, 2.0 and 3.0 (Swan, 2015).
Blockchain 1.0 focused on the trading of cryptocurrency. The functions of digital
money transfer, remittance and payment comprise a new ecosystem: “internet of
money” (Peters and Panayi, 2015). The bitcoin blockchain was the first phase known
as distributed open source ledger. “Money is Memory” was a similar idea put forward
by Kocherlakota (1998). However, the paper titled “Bitcoin: a peer-to-peer
electronic cash system” (Nakamoto, 2008) popularized the term block and its use has
been increasing ever since. Blockchain 2.0 involved a similar trading mechanism,
but with a much broader scope of financial applications. A new type of application
called a “Smart Contract” (Swan, 2015) was introduced in the second generation of
blockchain to expand trading from a simple digital currency to a large variety of
products. Blockchain-based smart contracts are computing programs operating on a
blockchain that autonomously verify, enforce and execute the terms of contracts
(Peters and Panayi, 2015; Zhang et al., 2016). Significance Blockchain technologies
and cryptocurrencies have attracted much attention in recent years (Radziwill,
2018). Blockchain is an emerging digital technology with the potential to push
organizations to rethink their strategies and capabilities (Schatsky and Muraskin,
2016). The most significant impact of blockchain technology is within the walls of
organizations (Schneider et al., 2016). A blockchain database is an immutable
ledger of transactions which is not maintained by a centralized authority and
provides proof of transactions without the need for authentication (Swan, 2015). A
blockchain supports several functions such as distributed storage and listings,
transactional validity, transactional persistence, transactional anonymity based on
multiple networks for transactions (Reid and Harrigan, 2011), transactional privacy
and traceability. Moreover, transactions can be validated almost instantly through
services such as “proof of service” (Duffield and Diaz, 2015), the “ripple protocol
consensus algorithm” (Schwartz et al., 2014) and “proof of stake” (Buterin, 2013).
The elimination of a central authority to validate transactions improves
efficiencies and reduces transaction costs. Similarly, the transfer of payment
between buyer and seller
is recorded in a common secure ledger (Hart and Holmstrom, 1986). Honeywell
launched its online buying and selling platform for new and used aircraft parts
using blockchain technology. Honeywell is the first to leverage a blockchain to
build trust between the buyer and seller (Petersson, 2019). 883 Potential of
blockchain technology in SCM Applications Smart contracts allow for the encoding of
rules and situations that are agreed upon by various trading parties. These
contracts autonomously execute pre-specified tasks, or settle a contract, by
examining changing conditions in conjunction with the contract’s embedded rules.
The execution and monitoring of contracts mainly rely on a trusted central
authority. Blockchain-based smart contracts decentralize the enforcement power to
each node in the network. This function of a blockchain helps to reduce the risk
between trading partners (Kiviat, 2015). Venture capital funded startups such as
Skuchain, a supply chain firm, are creating blockchain-based products to address
inefficiencies in business-to-business trade and supply chain finance (Kiviat,
2015). Smart contract The idea of smart contracts was proposed by Szabo (1994).
This term was used because the author saw them as analogous to legal contracts with
the ability of automated enforcement. Szabo (1994) presented a smart contract as an
extension of a digital-cash protocol and also recognized that Byzantine agreements
and digital signatures could be used as building blocks of smart contracts.
However, this view has been critiqued by Levy (2017). The blockchain network will
automatically stop the smart contract from moving along if a violation of the
covenant is detected, thereby limiting the potential of any further damage/loss.
Blockchain in supply chain management The use of blockchain technology outside
finance has been largely experimental. Some of the most promising non-finance
applications of blockchain technology are expected to include those in SCM, power
and food/agriculture. These areas are suitable fits for using blockchain technology
and are likely to deliver a return on investment at an early stage of blockchain
deployment. For example, dispatching roses from Kenya to Holland reportedly creates
a 25-centimeter high pile of paperwork which would be eliminated by this technology
(Lehmacher, 2017). A blockchain can make tracking items and transactions in the
supply chain radically faster and simpler by an estimated 85 percent when used in
conjunction with IoT technology, cutting administrative and logistics timelines in
shipping (Laaper and Fitzgerald, 2017). Researchers have noted that blockchain and
IoT blend is a powerful combination and is set to transform many industries
(Christidis and Devetsikiotis, 2016; Kshetri, 2018). A likely application of
blockchain technology is verifying sustainability. A blockchain can be used in SCM
to identify the players performing every action. The blockchain facilitates valid
and effective measurement of the outcomes and performance of the key SCM processes.
Once the input tracking data are on a blockchain ledger, they are immutable. Other
suppliers in the chain can also track shipments, progress along the way and
deliveries (Mishra et al., 2018). For example, “Australia’s largest 100% family-
owned meat processor, Thomas Foods International, and largest independent grocery
retailer, Drakes Supermarket have signed on as members of the blockchain-based food
ecosystem IBM Food Trust. The two South Australian organizations are the first in
Australia to pilot IBM Food Trust using the IBM Blockchain Platform, reducing
traceability times from three days to three seconds” (Pauka, 2019). In this way,
blockchain produces trust among suppliers. By eliminating intermediaries, the
efficiency of auditing can be improved and costs can be lowered. Individual
suppliers can perform their own checks and balances on a real-time basis (Koetsier,
2017). The blockchain also provides an accurate method of measuring product quality
during transportation. The shipping industry is increasingly looking to streamline
global supply processes by implementing the blockchain platform. The reason for
this is that 90 percent of goods in global trade are carried by ships and 884
IJPDLM 49,9 shipping transactions often involve dozens of people and organizations,
generating more than 200 different interactions and communications among them
(Allison, 2018). Most shipping transactions involve sales contracts, charter party
agreements, bills of lading, certificates of origin, port documents, LC and many
other documents related to a vessel and its cargo. The internet facilitates the
digital exchange of documents, but this occurs bilaterally and therefore still
causes delays along the supply chain. Moreover, 80 percent of shipping
documentation is still in paper from Southurst (2016). Shipping companies using
blockchain technology would be able to upload and share documents instantaneously
and securely. This would allow every participant to track and manage the shipment’s
progress and documentation from start to finish, increasing efficiency and
transparency, while simultaneously reducing costs and the risk of documents being
delayed, misplaced or tampered with (Kshetri, 2018). For example, Zim, an Israeli
shipping company, has wrapped up the first pilot of paperless bills of lading based
on blockchain technology. The application is free for shippers, importers and
traders, and requires no IT or operational changes. Prior researchers have noted
various key objectives of the supply chain. They include cost, quality, speed,
dependability, risk reduction (Bettis and Mahajan, 1985; Thomas and Baird, 1990)
sustainability (Bowen et al., 2009) and flexibility (Dinnin et al., 2009; Goldbach
et al., 2003; Kovacs, 2004; Meyer and Hohmann, 2000; Rao and Holt, 2005; White,
1996). Global supply chains are complex and face multiple uncertainties (Manuj and
Mentzer, 2008). The blockchain technology can be deployed without the need for
devices to read hardware or having to attach tags to cases or pallets unlike many
other IoT systems such as RFID, smart fleet management and intelligent
transportation systems. However, it is not clear which industries have adopted this
technology or are moving in that direction. This led to the review of existing
academic literature to see the current trends. The next section will describe the
research design that was followed for this study.
Although trust has been considered one of the key success factors in supply chain
management (e.g., Brinkhoff et al., 2015; Kwon & Suh, 2004), in recent years,
global supply chains B Mehrdokht Pournader [email protected] Kongmanas
Yavaprabhas [email protected] Stefan Seuring [email protected] 1
Department of Management and Marketing, The University of Melbourne, Level 10, The
Spot, 198 Berkeley Street, Melbourne, VIC 3010, Australia 2 Chair of Supply Chain
Management, Faculty of Business and Economics, The University of Kassel, Kassel,
Germany 123 50 Annals of Operations Research (2023) 327:49–88 across numerous
industries have experienced the issue of trust deterioration (Guenther, 2020). This
is despite the fact that across industries, CEOs and executives unanimously believe
maintaining and increasing trust in supply chain relationships is at the core of
successful supply chain operations (Rajah, 2019). To address this concern, supply
chains globally have started embracing technology-based, trust-building remedies,
such as blockchain technology (Sneader & Sternfels, 2020). Due to its capability to
enhance information authenticity and transparency, blockchain is believed to have
the promising potential to radically transform the supply chain trade paradigm into
a trusted ecosystem of exchange. Moreover, and accelerated by the recent COVID-19
disruption to supply chains, blockchain-enabled trusted supply chains have
triggered interest from academics (Nguyen et al., 2020). Academic literature has
therefore initiated investigations into how to build trust through blockchain
technology (e.g., Howson, 2020) and address the following question: How can
blockchain technology impact trust in supply chain management? While one group of
academic thought leaders argue that the execution of blockchain will enable firms
to trade in a trustless ecosystem where there is no need for building trusted
relationships between trading partners (e.g., Asante et al., 2021; Kumar et al.,
2020), others believe that blockchain will enhance trust between supply chain
partners and create a trusted ecosystem of exchange (e.g., Centobelli et al., 2021;
Di Vaio & Varriale, 2020). Caldarelli et al. (2020) explicitly stated that early
blockchain literature believed that blockchain is a means for creating trust, but
more recently, scholars seem to focus on blockchain capabilities to enable
transactions performed in a trustless environment. Likewise, while some academics
show that blockchain installation can generate trust which will subsequently add to
a trusted relationship between trading parties (Joo & Han, 2021), others believe
that trust generated from the blockchain cannot directly transfer into trading
partners, and trust management between parties is still required (Kopyto et al.,
2020). Whether these seemingly contrasting views can converge to a single trust-
based framework for application of blockchains to supply chains is what we are
aiming to address in this paper. To date, there has not been a comprehensive review
that synthesizes the state-of-the-art body of knowledge regarding blockchain
implications on trust for supply chain management. The current study aims at
filling this gap by conducting a systematic literature review of blockchain and
trust in supply chains. We initially use the three dimensions of trust from
management research, namely the trustor–trustee perspective, a form of trust, and
temporal orientation, as a framework for content analysis. We adopt a combination
of inductive and deductive approaches to analyse content and gain insights from our
selection of 94 relevant academic publications published between 2018 and 2021.
Subsequently, we developed a three-step trusted ecosystem model of the blockchain-
based supply chain that demonstrates how trust is formed by adopting blockchain to
supply chains and disseminating to other supply chain stakeholders. The proposed
models are developed in three variations to consolidate and converge the
aforementioned contradicting views of blockchain application to supply chains as
well as making a case for swift trust formation under certain circumstances in
supply chains. The remainder of the paper is organized as follows: first, we
provide an overview of the literature on the definitions and assessment of trust in
supply chains as well as a theoretical background of three dimensions of trust
leading to Sect. 3, where we outline the underly- ing methodology. In Sect. 4 we
discuss the outcome of the literature review regarding the blockchain implication
on trust in supply chains and subsequently develop three models of the blockchain-
entrusted supply chain. Our contributions to theory and practice are outlined 123
Annals of Operations Research (2023) 327:49–88 51 in Sect. 5. Finally, we provide
the conclusion of this study and several avenues for future research in Sect. 6. 2
Conceptual foundation Blockchain is a decentralized network system comprising a
number of blocks, each of which is capable of storing and sharing real-time,
encrypted digital information to other blocks within the network (Nakamoto, 2008).
By perceiving each supply chain member as a block, hypothetically, every
participant is allowed to know “who is performing what actions in which location
and at what time” in real-time (Crosby et al., 2016). With this exceptional
characteristic, blockchain equipment is projected to bring the superiority of
system security and information visibility to supply chain operations (Carson et
al., 2018). During the past three years, numerous comprehensive reviews of
blockchain technology and its application to supply chains have been conducted
(e.g., Chang & Chen, 2020; Luo & Choi, 2021; Müßig- mann et al., 2020; Pournader et
al., 2020b; Saberi et al., 2019; Wang et al., 2019a). While we refer the readers to
these reviews for an in-depth discussion of blockchain application to sup- ply
chains, in this section we primarily focus on the literature on trust and trust
dimensions, to be adopted as a core framework in the following sections. 2.1 Trust
in supply chain management Trust has been considered at the core of relationship
management between supply chain part- ners (e.g., Brinkhoff et al., 2015; Kwon &
Suh, 2004). As the relationship between supply chain partners is often fragile and
involves a certain level of risk in terms of opportunis- tic behaviour, there is a
need for trust to bind these relationships and manage those risks (Spekman, 1988).
When supply chain members possess a high level of trust in one another, they are
likely to feature positive attributes including greater collaboration (Ha et al.,
2011), operational efficiency (Ha et al., 2011), responsiveness (Handfield &
Bechtel, 2002), innova- tiveness (Fawcett et al., 2012), flexibility and agility
(Kabra & Ramesh, 2016), and resilience (Jain et al., 2017). Trust is defined in the
extant literature as “a willingness to be vulnerable” (Mayer et al., 1995), “the
extent to which a person is confident in, and willing to act on the basis of, the
words, actions, and decisions of another” (McAllister, 1995), “the willingness to
be vulnerable under conditions of risk and interdependence” (Rousseau et al.,
1998), and “confident positive expectations regarding another’s conduct” (Lewicki
et al., 1998). It is noticeable that from multiple proposed definitions, trust
always involves at least two actors, a trustor who is in a vulnerable position
through risks and interdependence, and a trustee who is entrusted and can take
advantage of the trustor by not fulfilling his or her expectation. Trustor and
trustee entities can vary as trust can be bestowed upon an individual (McAllister,
1995), an organization (Kramer, 1999; Zaheer et al., 1998), political institutions
(Kim, 2005), and other objects. Extending the latter definitions of trust to supply
chains, the willingness to be vulnerable occurs when one entity (trustor) agrees to
have confidence in the behaviours or actions of another entity (trustee) and has an
expectation that the trustee will fulfill their obligations independent of the
trustor’s ability to monitor or control such behaviours. 123 52 Annals of
Operations Research (2023) 327:49–88 2.2 Dimensions of trust Existing literature
indicates that trust primarily consists of three dimensions, namely the pairs of
trustor–trustees (Janowicz & Noorderhaven, 2006), forms of trust (Laeequddin et
al., 2010), and time orientation (Dubey et al., 2019). Collectively, these
dimensions should further clarify “who” the trustor and trustee roles are in supply
chains, as well as the forms of trust that are bestowed upon them. (1) Trustor–
trustee perspective. Trust involves at least one trustor and one trustee entities,
such as a buyer and a supplier. It is crucial to determine who the trustor and
trustees are before conducting a trust investigation. Janowicz and Noorderhaven
(2006) suggested that a change in a pair of trustors and trustees in supply chains
can lead to the need for variation in the approaches for trust assessment. For
instance, the conceptualization and assessment of interorganizational trust between
supply chain partners (e.g., Capaldo & Giannoccaro, 2015; Janowicz & Noorderhaven,
2006) varies from the trust external consumers place on supply chain management and
members (e.g., Hoejmose et al., 2012; Macready et al., 2020). (2) Form of trust.
Trust in supply chain management has variations in its form (Laeequd- din et al.,
2010). Although forms of trust are represented in different names in previous
studies in the management arena, they seem to be grounded on the three rudimentary
cate- gories namely institution-based trust, cognition-based trust, and affect-
based trust (Lewis & Weigert, 1985; Rousseau et al., 1998; Wong et al., 2008).
These three fundamental forms of trust in management research
can be adopted for discussing the trust element in supply chains. Institution-
based trust or system-based trust refers to the trust that emerges from formalized
arrangements and control mechanisms which normally manifest in the form of legal
sys- tems, regulations, bureaucratic sanctions, and contracts and agreements
between two parties (Lewis & Weigert, 1985; Wong et al., 2008). As institutional
trust can help deter a party’s opportunistic behaviour due to law and reputational
sanctions, a trustor is likely to bestow a higher level of trust on a trustee in
the presence of such arrangements and control mechanisms (Rousseau et al., 1998).
Cognition-based trust or rational trust refers to trust that involves high
rationality and low emotionality through which a trustee shows “good reasons” and
evidence to justify their intentions to perform an action which the trustor
perceives as beneficial (Lewis & Weigert, 1985; Wong et al., 2008). Basically, a
trustor bestows this type of trust based on their calcu- lation of the costs and
benefits as well as their prediction of the outcomes and the possibility that a
trustee will complete their obligations as agreed (Doney & Cannon, 1997).
Therefore, credible information from trustees regarding their competencies and
intentions is paramount in the formation of cognition-based trust (Rousseau et al.,
1998; Wong et al., 2008). Affect-based trust or emotional trust is signified by
high emotionality and low rationality. It refers to the trust that involves
affectional bonds and attachment between the trustor and trustee (Lewis & Weigert,
1985; Rousseau et al., 1998). McAllister (1995) also indicated that a trustor may
manifest this type of trust by showing intention to provide extra help and
assistance to a trustee without gaining anything in return. Affect-based trust is
typically considered as traditional trust between partners within supply chains
(Wong et al., 2008). (3) Temporal orientation trust. In management research, there
is a specific type of trust that can be built rapidly in certain conditions, in
contrast to traditional trust that develops over the long term (Meyerson et al.,
1996; Robert et al., 2009). Long-term versus swift trust-building practices are
included within the domain of temporal orientation. Originally coined by Meyerson
et al. (1996), swift trust is a specific type of trust that can be established 123
Annals of Operations Research (2023) 327:49–88 53 Table 1 Summary of trust
dimensions, descriptions, and categorizations Trust dimensions Description
Categories Trustor–trustee perspective Identify two actors of trustor and trustee
Form of trust Identify different forms of trust bestowed from trustor to trustee
Institution-based trust Cognition-based trust Affect-based trust Temporal
orientation Identify the required time and situation in which trust can be
developed Swift trust Long-term oriented trust rapidly for a temporary group of
people or entities to accomplish task-specific objectives in a short period of
time. It normally stems from the combination of current circumstances and
conditions evaluated by the trustor including group members’ reputations, assigned
responsibilities, consistent information exchange, and committed norms, and rules.
Swift trust has recently gained the increasing attention of supply chain scholars
interested in increasing supply chain coordination and agility (e.g., ; Dubey et
al., 2019). At the other end of the spectrum, long-term oriented trust is the
conventional concept of trust that is built over a certain period of time. Long-
term developmental trust typically requires a combination of different forms of
trust (Rousseau et al., 1998). A summary of three dimensions of trust and the
categories in each dimension adopted from management research are provided in Table
1.
Within the scope of the circular economy, which is born as the opposite of the
linear economy, using blockchain technology brings to mind two important concepts;
sustainability and digitalization (WBGU, 2019). Considering the activities in the
chain where the raw material is taken, processed and transported to the customer,
blockchain technol- ogy, which is included in the dimension of digitalization, has
the quality to contribute to the efficiency of the resource used in this chain. The
circular economy, which was put forward to prevent production by using resources
continuously before they run out, is an important po- tential for sustainable
development with its ability to reduce waste and increase resource use (Korhonen et
al., 2018). Along with the developing technologies, the key point for the adoption
of these capabilities in businesses has been defined as blockchain technology
(Kouhizadeh et al., 2019a). In line with these explanations, the concepts of
sustainability-circular economy-blockchain technology are intertwined and can be
considered as developments that add value to each other. Businesses agree that the
adoption of the circular economy and, in practice, are clearly linked to
digitalization, as it can make it easier to monitor the product phases throughout
the product lifecycle (Chauhan et al., 2022). Efficiency-oriented operation is
maintained by paying attention to the use of products and materials in the entire
supply chain line. The circular economy also effectively manages the value chain
for waste reduction and disposal at the end of use (Lacy et al., 2020), aiming to
keep products and outputs in circulation for the longest time while preserving
their value (Bocken et al., 2016). Undoubtedly, it is block- chain technology that
contributes to this management, and with its traceability feature, it provides the
opportunity to improve by correcting the errors that can be encountered at every
stage. Addressing supply chain-driven challenges such as product traceability,
material flow, and supplier collaboration is particularly critical to accelerating
the adop- tion of the circular economy (Erol et al., 2022). Since the point
mentioned in this whole flow is the TBL dimensions of the concept of E-mail
address: [email protected]. Contents lists available at ScienceDirect Journal
of Environmental Management journal homepage: www.elsevier.com/locate/jenvman
https://doi.org/10.1016/j.jenvman.2022.117173 Received 20 October 2022; Received in
revised form 20 December 2022; Accepted 27 December 2022 Journal of Environmental
Management 330 (2023) 117173 2 sustainability, blockchain technology, circular
economy and sustain- ability can be carried out together. In response to increasing
competi- tion, limiting the use of unlimited resources and ensuring productivity
have pushed businesses away from linear economy to circular economy where recycling
is also important (Bocken and Antikainen, 2018). The idea that blockchain
technology will contribute to this impor- tance with the increasing importance of
agriculture and food with climate change and resource scarcity is the main subject
of the study. In this direction, the most basic study that should be focused on in
the agriculture-food supply chain management line is the parameters of productivity
in the product flow and prolonging the product life cycle. For this purpose,
businesses advocate the combination of digitalization and circular economy
transformation (Ajwani-Ramchandani et al., 2021), while the circular economy
targets the 3 R (Reduce, Reuse and Recycle) strategy (Ellen MacArthur Foundation,
2013) blockchain in the agri-food chain. It is thought that the use of technology
will provide benefits in many ways to promote sustainable production and con-
sumption. Blockchain technology is recognized as an efficient and cost-effective
technology to control the relationships between multiple employees in a reliable
and decentralized way using smart contracts (Nesarani et al., 2020). It can
transform every step of the supply chain, from raw material supply to distribution
to consumers in the agri-food line. With the transparency principle of the
stakeholders in the supply chain (Min, 2019), the effective execution of the
information flow (Litke et al., 2019); providing consumers with reliable
information about the product (Sadouskaya, 2017); minimization of costs (Chang et
al., 2019); improving carbon emissions with optimum transport management; It is in
a position to contribute significantly to optimum time management (Tijan et al.,
2019) and sustainability by potentially improving the environment. One of the most
important reasons why blockchain tech- nology has attracted great interest in
supply chain management is that it provides a solution to the trust problem between
stakeholders. The aim of this study is to research, analyze and interpret the
critical success factors of the use of blockchain technology in the flow of agri-
food supply chain management on the way to the circular economy. Considering the
existing studies, this study aims to answer the following research questions in
order to create sustainable agri-food supply chain management. RQ1. What are the
various political and technological factors when considering blockchain technology?
RQ2. What are the economic, environmental and social factors in decision making for
a sustainable system? RQ3. Is blockchain technology considered within the scope of
circular economy in line with the determined factors? RQ4. Does blockchain
technology for the agri-food sector contribute to the circular economy? RQ5. In the
general framework, how can blockchain technology be ranked according to the
importance of factors in performance improvement? To answer these identified
research questions, the objectives of this study are as follows. − To identify
various factors under the political, economic, social, technological, environmental
and legal dimensions of blockchain technology for agri-food supply chain management
within the scope of circular economy using PESTEL analysis approach. − To
investigate the interrelationships between various factors under PESTEL dimensions
of blockchain technology in circular economy dimension using Analytic Network
Process (ANP). − To sort and compare the factors classified in PESTEL dimensions
according to their importance levels with the ANP-MultiAtributive Ideal-Real
Comparative Analysis (MAIRCA) method. Other parts of the study proceed as follows;
In Section 2; the rela- tionship between circular economy-agri-food supply chain
management and circular economy-blockchain technology is emphasized and a detailed
literature review is given. In Section 3, the theoretical infor- mation of the
necessary applications (PESTEL-ANP-MAIRCA Methods) for critical success factors of
blockchain technology in agri-food supply chain management is given. Findings as a
result of the application of the methodology determined in Section 4 are included
and the results are shared. In Section 5, under the title of discussion and
managerial im- plications, applicable inferences are given by making comparisons
with the literature. In the last section, the results of the research are included
and evaluated in a general framework and suggestions for future studies are
presented. 2. Literature review In this section, the relationship between the
circular economy and agriculture-food supply chain management is explained, and the
liter- ature is highlighted by emphasizing the advantages of circular economy and
blockchain technology. 2.1. Circular economy - agri-food supply chain management In
the circular economy perspective, the agri-food sector is one of the key sectors
that needs action to adopt sustainability principles (Poponi et al., 2022). More
than 860 million people are malnourished today, with food waste along the supply
chain accounting for about one-third of the food produced. While the habit of
wasting food contributes to more than 1.3 billion tons of waste annually (FAO –
Food and Agriculture Organization of the United Nations, 2021), rotten and spoiled
food also contributes to climate change, releasing 3.3 billion tons of greenhouse
gas emissions (FAO – Food and Agriculture Organization of the United Nations,
2021). Food waste is not only an environmental and social problem, but also a
significant economic loss (Ponis et al., 2017), because this loss and waste costs
the global economy $936 billion annually (FAO – Food and Agriculture Organization
of the United Na- tions, 2015). From sustainable agricultural practices, efforts to
reduce or transform food loss have made the circular economy presence felt in the
sector. Circular economy and agri-food supply chain management means minimizing the
waste and greenhouse gas emissions produced at various stages of the supply chain
(Baratsas et al., 2021). In this context, the Sustainable Development Goals (SDG)
established by the United Nations come to the fore with their approaches to food
and offer countries to implement these goals. Many of these goals also cover cir-
cular economy and agri-food practices. Of these, SDG 2 aims; It aims to end hunger,
ensure food security and improve nutrition, and promote sustainable agriculture.
SDG 12 aims to increase sustainable production and consumption, increase resource
use efficiency, and eliminate food loss through recycling and reuse. SDG 7 for
cleaner and renewable en- ergy sources; SDG 13 for climate change is one of the
objectives asso- ciated with the circular economy (Barros et al., 2020). Fassio and
Tecco (2019) conducted a comprehensive analysis of 40 case studies evalu- ating the
effectiveness of various circular economy actions for the integration of SDGs into
food systems. The circular economy, by defi- nition, is an important starting point
for the food industry in protecting the environment
and optimizing resources. In the circular economy methodology, the aim is to
preserve the usefulness and value of the products in the supply chain line through
the application of different principles (Nandi et al., 2021) includes management.
In this way, it aims to preserve the concept of value in the cycle for a long time
by ensuring the efficient flow of resource use throughout the product life cycle.
It is an economy that can find a place for itself in all areas of the line within
the circular economy supply chain management, and that can keep the intrinsic value
of the resource at high levels from raw material supply to product recycling. A
review of the existing literature reveals that the agri-food sector and circular
economy are important. E. Yontar Journal of Environmental Management 330 (2023)
117173 3 Matching the circular economy with food loss and waste, De Oliveira et al.
(2021), about food losses and wastes with solutions based on cir- cular economy
parameter; Zhang et al. (2022) revealed a systematic analysis by searching
scientific publications that food waste manage- ment is a prominent theme in
connection with the circular economy and Yousefi et al. (2021a) researched
wastewater. In order to prevent water pollution for food waste, environmentally
friendly studies are carried out (Yousefi et al., 2021c). At the same time,
Kusumowardani et al. (2022) stated that the circular economy is a suitable tool for
firms to reduce food loss and waste. They explored how to use the circular economy
in practice by examining manufacturers, distributors, and re- tailers in the agri-
food supply chain. Addressing the traceability study in addition to food waste,
Anastasiadis et al. (2022) explored the role of traceability in the transition to
sustainability-focused circular agri-food supply chains. As a result of Delphi
research, a change at the consumer level drives changes in the supply chain and
ultimately at the company level. In this context, Baratsas et al. (2021) presented
a new circular economy systems engineering framework and decision-making tool for
modeling and optimizing food supply chains. According to Poponi et al. (2022)
created an indicator template to guide decision-making pro- cesses and strategies
that can be used at various spatial levels to drive the agri-food sector towards a
circular economy and sustainable devel- opment. Again, Van Schoubroeck et al.
(2022), similarly, defined and listed a set of indicators to monitor the cyclical
food economy within the food system. In studies addressing food safety, Lavelli
(2021) developed management solutions by discussing the impact of the increasing
complexity of circular supply chains on food safety. He emphasized that the
management system within a circular supply chain should be implemented by involving
all trading partners and stakeholders to ensure high transparency, connectivity and
efficiency. According to Prajapati et al. (2022) developed a framework for a
virtual closed-loop supply chain based on the concepts of sustainability and
circular econ- omy, as well as blockchain and IoT technologies. In order to
eliminate the ecological problem of water pollution and to save energy con-
sumption, Yousefi et al. (2021b) discussed chemical problems in their study. Mahdi
et al. (2022) achieved gains with environmentally friendly practices. 2.2. Circular
economy-blockchain technology The irrelevant need of the circular economy for the
agri-food supply chain has brought useable features of technology as well. One of
them is blockchain technology, which is an important factor in achieving the
circular economy. Blockchain, with its decentralized structure and fea- tures such
as reliability, transparency, smart contracts and traceability, increases the
performance of supply chain management (Groening et al., 2018). This has attracted
businesses considering a circular economy, with data being secure, hack-proof, and
a reputation for transaction transparency. Blockchain technology is a distributed
and decentralized ledger system that ensures the integrity of transactions (Bambara
and Allen, 2018). Thanks to this distributed structure and decentralization, blocks
are included in the system with high-level encryption when a certain transaction is
performed, preventing forgery. With their trace- ability and transparency features,
they can optimize resource use and significantly reduce waste by tracking products
and materials throughout the entire supply chain management, from raw material
purchase to customer recycling processes (Bocken et al., 2016; Upad- hyay et al.,
2021). On the other hand, they contribute to the increase of productivity by
accelerating the process processes on the supply chain. Since achieving a circular
economy is among the SDG and the common goals of countries, blpckchain technology
is in a position to facilitate the decision-making mechanisms of the stakeholders
along the chain. The current literature provides the positive link between the
circular econ- omy and blockchain technology. Helo and Hao (2019) focused on the
potential of the circular econ- omy with blockchain technology within the supply
chain. At the same time, Upadhyay et al. (2021) explored the potential
applicability of blockchain to improve the circular economy. They stated that this
technology will contribute to the circular economy by reducing trans- action costs
and increasing communication. Ajwani-Ramchandani et al. (2021) also presented
applications on their effects on social, environ- mental and economic welfare in
his study. Kouhizadeh et al. (2020) advocated circularity, which has important
implications for increasing resource efficiency of the distributed structure of
blockchain technology. Centobelli et al. (2022) examined the trust, traceability,
and trans- parency factors that affect blockchain technology within the strategies
of the circular economy in supply chains. Huang et al. (2022) aimed to develop a
framework that evaluates the critical success factors of blockchain technology
implementation for a circular supply chain management. Wolf et al. (2022) explored
the adoption of blockchain technology applications that can help companies
implement business models of the circular economy. On the other hand, Erol et al.
(2022) explored the barriers to adopting the circular economy. It proposes an
integrated decision framework that includes the Unstable Fuzzy Lin- guistic Term
Sets and the Quality Function Deployment method based on Multi-Criteria Decision
Making to explore the true potential of the blockchain for the circular economy. In
contrast, Bockel ̈ et al. (2021), in the study, proposed blockchain technology as a
possible critical solution to overcome the existing barriers to the circular
economy. Yildizbasi (2021), in the circular economy blockchain technology studies,
in which different sectors are discussed, mentioned the concept of blockchain in
order to eliminate the problems experienced in the energy grid man- agement process
and listed the difficulties faced by blockchain during integration into the
circular economy. According to Erol et al. (2021) identified critical success
factors for improving the circular economy performance of a blockchain technology-
based solar photovoltaic en- ergy ecosystem in Turkey to achieve better circular
economy perfor- mance in the renewable energy sector. Again, Wang et al. (2020)
proposed a blockchain-based system architecture to operationalize cir- cular supply
chain management in the fast fashion industry. Based on existing studies, this
study aims to contribute significantly to the literature by addressing the agri-
food sector, by identifying crit- ical success factors for the applicability and
adoption of blockchain technology within the scope of circular economy. Examining
the critical success factors that will contribute to the agri-food supply chain
man- agement system by considering sustainability-blockchain technology- circular
economy together fills this gap both at the sector level and in terms of scope.
Supply chains (SCs) face unprecedented challenges. The tendency to lengthen them
(Chopra et al. 2021) increases their vulnerability in terms of information sharing,
and trust poses difficulties in their management. To overcome this problem, SC
managers actively seek disruptive solutions that bring innovativeness, efficiency,
and effectiveness to their operations (Behnke and Janssen 2020). The global state
of emergency due to the Covid-19 pandemic in 2020 highlighted the need for SC
digitalization. The digitalization phenomenon is already shaping new realities and
relation- ship models throughout the entire SC network (Queiroz and Fosso Wamba
2019). One of the most recognizable disrup- tive technologies for SC adoption is
blockchain technology (BCT) (Queiroz et al. 2020). Blockchain is defined as a
‘cryptographically guaranteed non-tamperable and unforgeable distributed
decentralized ledger’ (Liu and Li 2020, p.2). BCT makes it possible for supply
chain management (SCM) activities and operations * Joao C. Ferreira
[email protected]; [email protected] Ulpan Tokkozhina [email protected]
Ana Lucia Martins [email protected] 1 Business Research Unit (BRU-IUL),
Lisbon, Portugal 2 Instituto Universitário de Lisboa (ISCTE-IUL), 1649-026 Lisbon,
Portugal 3 Inov Inesc Inovação—Instituto de Novas Tecnologias, 1000-029 Lisbon,
Portugal 4 Information Sciences and Technologies and Architecture Research Centre
(ISTAR-IUL), Lisbon, Portugal 5 Molde University College — Specialised University
in Logistics, NO-6410 Molde, Norway 100 U. Tokkozhina et al. 1 3 to occur in a
highly secure and transparent way, without the need for a central organization
(Gonczol et al. 2020). Thus, it is a potential game-changer for supply chains (SCs)
in terms of information exchange and verified transactions (Hackius and Petersen
2020). However, the adaptation blueprint of BCT still requires a more focused and
comprehensive evalu- ation (Wong et al. 2020a), as well as an understanding of the
critical requirements, issues, and challenges across the SC (Ghode et al. 2020b;
Wang et al. 2020b) for successful BCT deployment. Endeavours to systematize BCT in
the SCM context have been undertaken by numerous scholars, with a focus on, i.e.
application areas (Queiroz et al. 2019; Chang and Chen 2020; Duan et al. 2020),
industrial contexts (Wang et al. 2019a; Idrees et al. 2021), concept definition
(Fosso Wamba et al. 2020a, b), bibliometric analysis (Fosso Wamba et al. 2020a;
Müßigmann et al. 2020), and article coding (Lim et al. 2021). Systematization has
also been explored in the transport and logistics sector (Kummer et al. 2020;
Pournader et al. 2020), food SC (Kayikci et al. 2020; Stranieri et al. 2021), and
from information-sharing perspectives (Wan et al. 2020). The potential benefits,
challenges, drivers, and barriers to BCT adoption in SCM have also been studied
using empirical data (van Hoek 2019; Wang et al. 2019b; Stranieri et al. 2021) as
well as in specific fields such as agriculture (Kamilaris et al. 2019), the textile
and clothing industry (Agrawal et al. 2021) and modern military solutions (Saadiah
and Rahayu 2021). A common feature of these wide-ranging attempts to study BCT in
SC is a case-specific perspective. There are as well more generalized reviews that
were found in prior literature, that were not attaching findings to a specific area
of application. Such studies were building comprehensive maps of separate BCT
application topics and themes for supply chain performance (Mahyuni et al. 2020),
indicating the most influential authors and publications in the area (Moosavi et
al. 2021), separately summarizing ena- blers, benefits, and risks of BCT adoption
(Karakas et al. 2021), conceptualizing stages and factors behind the adop- tion (Vu
et al. 2021). Extant literature reviews offer many contributions in specific
sectors, e.g. food and agriculture SCs (Galvez et al. 2018; Lezoche et al. 2020;
Sharma et al. 2021), or reviews of a mix of different technologies under the scope
of Industry 4.0 (Bodkhe et al. 2020; Mistry et al. 2020). There as well were
studies that grouped themes into clus- ters (Klerkx et al. 2019) and structured
topics and trends into mind maps (Casino et al. 2019). Recently scholars were
conducting bibliometric analysis of literature in the field (Moosavi et al. 2021;
Tandon et al. 2021), in the context of operations management, mechanisms of a
trace- ability feature of BCT were explored (Feng et al. 2020). Thematic analysis,
identifying the orders of benefits and challenges domains of BCT adoption in food
SC was as well performed (Chen et al. 2021). However, there is still a lack of a
more holistic understanding of the ways in which BCT implementation impacts SCM and
operations, outside of a specific application area or context, based on
systematized data. Among open issues of BCT exploration in SC context, such
research gaps as suitability of BCT for specific pro- jects, and a mechanism to
choose a proper blockchain net- work that would suite the actual needs of the
application was highlighted (Casino et al. 2019). The need of leading through
emerging technologies adoption was mentioned (Klerkx et al. 2019), in order to
enhance the benefits and alleviate potential negative effects. Research is needed
to guide through decision-making process of the adoption of BCT for businesses
(Frizzo-Barker et al. 2020). It is also necessary to investigate the societal,
organizational, and environmental factors that affect BCT implementation in SCM
(Tandon et al. 2021). Therefore, the contribution of the present research goes
beyond prior studies to provide a broader vision and holis- tic understanding of
the existing features of BCT in the SCM context, grouping them into unified general
dimen- sions, without limiting it further to a specific industry or area of
application. Like this, it would contribute to gaps identified by previous scholars
in the field. Against this backdrop, this research aims to create a systematized
understanding of BCT in the SCM context. The goals of this study are threefold: (1)
to explore the dimensions of the impact of BCT implementation in SCM; (2) to
explore the synergies of these dimensions; and (3) to explore the virtuous and
vicious cycles of the adoption of BCT use in SCM. To achieve these goals, a
systematization of the exist- ing literature is pursued. Specifically, BCT features
found in the literature are systematized, the operations manage- ment dimensions of
the impact of BCT implementation in SCM are exposed, and the synergetic and
counter-synergetic effects of these dimensions in terms of the advantages, dis-
advantages, and constraints of BCT implementation are discussed. The remainder of
this paper is organized as follows. Sec- tion 2 provides a literature review of the
BCT phenomenon in the SC context, as well as current SCM challenges. Sec- tion 3
details the methodology adopted in this study. Sec- tion 4 provides a systematized
understanding of BCT fea- tures in the SCM context, which are conveniently
displayed in tables and clarifies the logic process underpinning the dimensions and
their synergies. Section 5 discusses the theo- retical and managerial contributions
of this study and sug- gests areas to be addressed in future studies. Finally,
Sect. 6 provides the conclusions of the study and critically identifies its
limitations. Uncovering dimensions of the impact of blockchain technology in supply
chain management 101 1 3 2 Literature review Today, supply chains are beginning to
lose the necessary visibility across networks due to their length (Mubarik et al.
2021). SC visibility is the transparency to identify product transit status
throughout and outside the supply chain (Roy 2021). It plays a crucial role in
strengthening trust and collaboration among different stakeholders (Baah et al.
2021). Thus, to gain visibility for SCs, organizations must establish a way to
share timely and reliable informa- tion across networks (Tapscott and Tapscott
2020). Another major SCM focus of organizations is a long- term stability
perspective: building confidence and reli- ance among SC participants (i.e.,
building trust) (Paluri and Mishal 2020). The long and complex nature of SC
networks requires interactions between multiple entities, resulting in challenges
in establishing trust among them (Doroudi et al. 2020). An increasing level of
trust in the SC scale leads to risk reduction (Collier and Sarkis 2021) and more
stable end-consumer behavior (Doroudi et al. 2020). 2.1 Blockchain technology
Blockchain is a fully distributed and decentralized system that can capture and
store cryptographically encoded data and transactions in a block manner, similar to
a distributed ledger (Queiroz et al. 2019). The mechanism behind BCT then connects
each block—which is identified with a unique hash code (a cryptographic algorithm
that transforms a data input into a fixed-length irreversible output)—to a previous
block, thus connecting all blocks into a chain (Queiroz et al. 2020; Wang et al.
2020c). This chain structure is the fundamental feature that ensures immutable and
reliable data in the ledger, as each block holds details (the unique hash code) of
the previous blocks’ content (Gonczol et al. 2020). Thus, BCT allows safe data
exchange within the SC in a distributed manner (Wang et al. 2019b). BCT brings
traceability to SCs, allowing assets to be tracked and providing stakeholders with
the visibil- ity required to do so (Choi 2020; Wang et al. 2020b). Through BCT
adoption, it is possible to reduce the inci- dence of unfair practices and
counterfeits (Juma et al. 2019; Stranieri et al. 2021) and boost the overall
efficiency of SC operations (Leng et al. 2018). Another important innovation that
BCT entails is smart contracts, which are, essentially, ‘digital contracts that
flow across enterprises’
(Kamble et al. 2019, p.2011), enabling the automation of processes (Nandi et al.
2020) because smart contracts are self-executable (Min 2019). Overall, BCT has the
potential to manage resources efficiently and reduce inventory levels (Kamble et
al. 2019), reduce SC risks through traceabil- ity features (Kshetri 2018; Montecchi
et al. 2019), and optimize planning and forecasting decisions (Perboli et al.
2018). 2.2 Blockchain benefits and challenges in the context of supply chain
management BCT also has attractive capabilities for SC participants; it can improve
collaboration between entities (Mao et al. 2018), especially in untrusted
environments (Liu and Li 2020), and reduce the bullwhip effect (Perboli et al.
2018). Increasing SC performance and data visibility (Hald and Kinra 2019) results
in product quality compliance and improves trust among consumers (Ghode et al.
2020b; Nandi et al. 2020). To improve practitioners’ experience, BCT can, for
example, be used together with other artificial intelli- gence technologies
(Kayikci et al. 2020) and combined with Internet of Things (IoT) devices (Rejeb et
al. 2019). However, BCT has several disadvantages. Although BCT can provide
traceability through digital records, it cannot ensure the real condition of
physical products in transit (Yadav and Singh 2020) and is not always a suitable
solu- tion, depending on the cost of the product. For example, for lower-cost
products, there is less need to thoroughly trace products (van Hoek 2019). Smart
contracts are also consid- ered difficult to implement if the coding of the
contract is of poor quality, which usually leads to a series of problems throughout
the SC (Cole et al. 2019). The lack of central authority within the SC is sometimes
considered a disadvan- tage, especially when resolving disputes among SC entities
(Wang et al. 2019a, b). Another major concern is an environ- mental one: BCT
consumes excessive amounts of energy to conduct transaction-related activities
(Öztürk and Yildizbaşi 2020; Yadav et al. 2020). Some challenges still exist in
modern SCM, including, e.g. relationship and trust issues between participants in
complex SCs, considerations regarding firms’ social responsibilities, concerns over
the visibility of operations that reveal the dynamics of supply processes, and
issues related to exploiting SCM to influence consumers’ buying decisions and gain
a competitive advantage (Cole et al. 2019; van Hoek 2020a, b; Rogerson and Parry
2020). BCT is considered a possible solution to these limitations of modern SCs;
however, a rigorous academic investigation is still required to understand the
extent to which BCT may create value for firms (Treiblmaier 2018). Additionally,
there are some practical constraints in the adoption of BCT in the SCM context. For
example, a lack of a relevant legal framework (Sheel and Nath 2019) can lead to
difficulties in convincing all stakeholders to adopt 102 U. Tokkozhina et al. 1 3
BCT (Duan et al. 2020). A lack of trust among SC network participants, national
circumstances, and cultural differences can also result in different decisions
during the adoption process (Kopyto et al. 2020; Queiroz et al. 2020; Wong et al.
2020a). Currently, most SCs are not yet ready for BCT adoption due to either the
lack of an organized ecosystem (Kamble et al. 2019) or the novelty of the
technology (Min 2019), as adoption of this technology is a complex process. Not
only it requires appropriate infrastructure, but it also needs to overcome
challenges related to existing regulatory and legal governance systems (Kamble et
al. 2021). BCT adoption poses constraints for supply chain participants in terms of
coping with the innovative decentralized structure (Omar et al. 2020). Dimensions
of BCT characteristics were introduced in the context of supply chain collaboration
(Rejeb et al. 2021), manufacturing industry (Karamchandani et al. 2021), healthcare
supply chains (Aich et al. 2021), and categorized key enablers of BCT accordingly
to its aims and opportunities (Ali et al. 2021). However, to the best of our
knowledge, a more holistic approach on BCT dimensions of impact and their
intersections exploration in terms of supply chain implementation was not yet
performed. A perceptible knowledge gap between managers of various organizations
and their comprehension of BCT was revealed (Walsh et al. 2021), thus an
intelligible representation of potential dimensions of impact and their
interconnection would assist practitioners in terms of novel technology
understanding and applications.
In recent years, the global landscape of supply chain management has witnessed
unprecedented challenges and complexities driven by factors such as globalization,
intricate networks of stakeholders, and an increasing demand for real-time
information (Chang, et al., 2020). In response to these challenges, block chain
technology has emerged as a revolutionary force reshaping the traditional paradigms
of supply chain management (Kamble, et al., 2023). This paper conducts a thorough
review of the application of block chain in supply chain management, with a
specific focus on its transformative impacts on efficiency, transparency, and
innovation within the intricate web of supply chain processes. Blockchain,
originally conceptualized as the underlying technology for cryptocurrencies, has
evolved beyond its initial financial applications to become a disruptive force
across various industries (Morhaim, 2019). Its decentralized and distributed ledger
architecture has proven particularly promising in addressing long-standing issues
in supply chains, ranging from the complexities of multi-party transactions to the
need for heightened security and transparency. This paper delves into the
multifaceted role that block chain plays in optimizing supply chain operations,
offering a critical examination of its efficiency-enhancing attributes, its
contribution to transparency and traceability, and its role as a catalyst for
innovative advancements within supply chain ecosystems. Efficiency in supply chain
operations has long been a focal point for organizations seeking to gain a
competitive edge in today's dynamic business environment (Ketchen, 2007).
Blockchain, through its decentralized nature, eliminates the need for
intermediaries, facilitating direct peer-to-peer transactions and automating
various aspects of the supply chain. This review explores how block chain
streamlines processes, reduces redundancies, and enhances the overall efficiency of
supply chain operations, ultimately leading to cost savings and improved
responsiveness to market dynamics. Transparency has become an indispensable element
in modern supply chains, where stakeholders demand real-time visibility into the
entire value chain (Apeji and Sunmola, 2022). Block chain’s immutable ledger
ensures transparency by providing a secure and tamper-proof record of transactions.
This paper investigates how block chain technology enables end-to-end visibility,
traceability, and accountability, fostering trust among supply chain participants
and aiding compliance with regulatory standards. Furthermore, the paper examines
the role of block chain in driving innovation within supply chains. Beyond its
foundational benefits, block chain serves as a platform for the integration of
emerging technologies such as the Internet of Things (IoT) and Artificial
Intelligence (AI). Case studies and pilot projects are explored to showcase
instances where block chain has not only optimized existing processes but also
paved the way for novel business models and collaborative ecosystems. While
recognizing the transformative potential of block chain in supply chain management,
this review also addresses the challenges and considerations associated with its
implementation (Saberi, et al., 2019). Interoperability, scalability, and
regulatory concerns are examined, offering a balanced perspective on the practical
implications of adopting block chain technology in diverse supply chain
environments. This paper aims to provide a comprehensive overview of the impact of
block chain on supply chain management, synthesizing insights into how it enhances
efficiency, transparency, and fosters innovation. By critically assessing both the
opportunities and challenges, this review contributes to a deeper understanding of
the role block chain plays in reshaping the future of supply chain management on a
global scale. 2. Efficiency in Supply Chain Management through Block chain In an
era marked by globalization, rapid technological advancements, and intricate supply
chain networks, the call for enhanced efficiency has never been more critical.
Traditional supply chain systems often grapple with inefficiencies arising from
intermediaries, manual processes, and a lack of real-time visibility (Skjott-
Larsen, 2007). Enter block chain technology, a game-changer poised to transform the
landscape of supply chain management. This paper explores how block chain is
revolutionizing efficiency in supply chain operations and reshaping the way
businesses manage their intricate webs of logistics, procurement, and distribution.
Supply chain operations are notorious for their complexity, involving multiple
stakeholders and intricate workflows (Litke, 2019). Block chain, with its
decentralized and transparent ledger, eliminates the need for intermediaries. This
not only streamlines processes but also simplifies the entire supply chain
ecosystem. Smart contracts, a feature of block chain, automate and execute
predefined actions when specific conditions are met, reducing the need for manual
intervention and minimizing delays (Abdellatif and Brousmiche, 2018). One of the
primary sources of inefficiency in traditional supply chains is the involvement of
intermediaries, each introducing potential delays and additional costs. blockchain
facilitates direct peer-to-peer transactions, cutting out unnecessary middlemen
(Lee and Khan, 2019). This not only accelerates the speed of transactions but also
significantly reduces costs associated with intermediaries. The introduction of
smart contracts takes automation to a whole new level. These self-executing
contracts encode and automate complex business rules, ensuring that agreed-upon
terms are met without the need for constant oversight (Unsworth, 2019). This not
only reduces the risk of errors but also enhances the speed and accuracy of
transactions, contributing to a more efficient supply chain. Block chain’s real-
time visibility into transactions provides stakeholders with instant updates on the
status and location of goods throughout the supply chain (Chang, et al., 2019).
This transparency not only fosters trust International Journal of Science and
Research Archive, 2024, 11(01), 173–181 175 among participants but also enables
proactive decision-making. Businesses can respond swiftly to disruptions, optimize
routes, and ensure the timely delivery of products (Craighead, et al., 2007). The
implementation of block chain in supply chain management yields tangible cost
savings. By eliminating intermediaries, automating processes, and reducing the risk
of errors, businesses can operate more efficiently and allocate resources more
effectively (Bharosa, 2013). Moreover, the improved responsiveness to market
dynamics ensures that businesses can adapt swiftly to changing conditions, gaining
a competitive edge in the market. Block chain technology is undeniably at the
forefront of driving efficiency in supply chain management (Rejeb, et al., 2023).
As businesses grapple with the complexities of today's globalized markets, the
adoption of block chain offers a transformative solution. From streamlining
processes and eliminating intermediaries to providing real-time updates and
reducing costs, the benefits of block chain in supply chain efficiency are both
tangible and revolutionary (Gohil and Thakker, 2021). As we move forward,
businesses that embrace this technology will likely find themselves not just
surviving but thriving in the ever-evolving landscape of modern supply chain
management. 3. Transparency and Traceability In an era where consumers demand more
accountability, and regulatory requirements for supply chains are becoming
increasingly stringent, transparency and traceability have become paramount in the
world of logistics and commerce. Block chain technology, renowned for its
decentralized and immutable ledger, is emerging as a powerful tool to bring
unprecedented levels of transparency and traceability to supply chain operations
(Raval, 2016). This paper delves into the ways in which block chain is transforming
the supply chain landscape by providing crystal-clear visibility and traceability
from source to consumer. The complexities of modern supply chains often leave
stakeholders in the dark, fostering a lack of trust (Soundararajan, et al., 2019).
Transparency is the antidote, offering a window into the inner workings of supply
chain processes. With consumers increasingly valuing ethical sourcing,
sustainability, and fair labor practices, businesses need to showcase a transparent
supply chain to build trust and maintain brand integrity (Perry, et al., 2015). At
the heart of block chain’s impact on transparency is its immutable ledger. Once
data is recorded on the block chain, it cannot be altered or tampered with (Zhu, et
al., 2019). This ensures that the information stored is reliable and trustworthy,
mitigating the risk of fraud and deception in the supply chain. Block chain’s
decentralized nature allows all stakeholders in the supply chain, from
manufacturers to distributors and retailers, to access a single, shared source of
truth. This end-to-end visibility enables real-time monitoring of every
transaction, movement, and transformation within the supply chain, fostering a
seamless and interconnected network (Musa, et al., 2014). Beyond transparency,
block chain enables traceability, allowing stakeholders to trace the journey of a
product from its origin to the end consumer. Every transaction and movement is
recorded on the block chain, creating an indelible record (Laroiya, et al., 2020).
This not only ensures accountability within the supply chain but also aids in
identifying the source of any issues or discrepancies. In an environment where
regulatory requirements for supply chain transparency are on the rise, block chain
provides a robust solution (Kraft, et al., 2021).
By maintaining an unalterable record of transactions, businesses can easily
demonstrate compliance with various industry and governmental regulations, avoiding
legal pitfalls and ensuring ethical practices. Transparency and traceability are
not only essential for regulatory compliance but also for building trust with
consumers (Sunny, et al., 2020). By providing detailed information about the
sourcing, manufacturing, and distribution of products, businesses can showcase
their commitment to ethical practices, sustainability, and quality. Block chain’s
transformative impact on transparency and traceability in supply chains is
reshaping the way businesses operate and how consumers perceive products (Wang, et
al., 2019). The immutable ledger, end-to-end visibility, and traceability offered
by block chain technology not only ensure compliance with regulations but also
empower businesses to build trust with consumers who increasingly seek transparency
and ethical practices in the products they purchase (Jabbar, et al., 2021). As
supply chains evolve, block chain stands as a beacon of clarity, illuminating the
path towards a more accountable and transparent future. 3.1. Compliance with
Regulatory Standards The evolving landscape of global commerce, adherence to
regulatory standards is not just a legal necessity but a fundamental aspect of
maintaining ethical business practices and consumer trust. Supply chain compliance,
in particular, is a complex endeavor, with regulations varying across industries
and regions (Haugland, et al., 2011). This paper explores how blockchain technology
is emerging as a robust solution to help businesses navigate the intricate web of
regulatory standards, ensuring transparency, traceability, and accountability
throughout the supply chain. Compliance with regulatory standards is a multifaceted
challenge in supply chains, involving aspects such as product safety, ethical
sourcing, environmental sustainability, and fair labor practices (Hofmann, et al.,
2018). Failure to meet these standards can lead to legal consequences, damage brand
reputation, and erode consumer trust. Navigating this complex regulatory landscape
requires a comprehensive and efficient approach (Nkongolo, 2023). Blockchain's
inherent feature of creating an immutable ledger is a game-changer for supply chain
compliance. Every transaction, from the origin of raw materials to the end
consumer, is recorded on the block chain. This not only provides a International
Journal of Science and Research Archive, 2024, 11(01), 173–181 176 transparent
audit trail but also ensures that the data cannot be tampered with, meeting the
stringent requirements of regulatory bodies (Alles, et al., 2004). Traditional
supply chain systems often struggle with providing real-time information required
for compliance reporting. Block chain’s decentralized nature allows for real-time
monitoring of transactions, movements, and transformations within the supply chain
(Helo and Hao, 2019). This capability enables businesses to generate accurate and
up-to-date compliance reports at any given moment. Smart contracts, a feature of
block chain, can be programmed to automatically execute compliance protocols when
predefined conditions are met. This automation not only reduces the risk of human
error but also ensures that compliance measures are consistently applied throughout
the supply chain, promoting a proactive rather than reactive approach to adherence
(Aron, et al., 2011). Businesses operating in multiple regions face the challenge
of navigating diverse regulatory frameworks (Caligiuri, et al., 2020). Block chain
can facilitate cross-border compliance by providing a standardized and universally
accessible ledger. This not only streamlines the compliance process but also
ensures consistency in meeting regulatory standards across different jurisdictions
(Sparrow, 2011). Demonstrating compliance through block chain not only satisfies
regulatory requirements but also builds trust with stakeholders. Suppliers,
distributors, and consumers can access a shared and unalterable record of
compliance, fostering transparency and accountability across the entire supply
chain ecosystem. Block chain technology is proving to be a powerful ally in the
pursuit of supply chain compliance (Novo, 2018). Its ability to create an immutable
record, offer real-time monitoring, automate compliance protocols, and facilitate
cross-border standardization positions it as a transformative force in the complex
regulatory landscape. As businesses embrace block chain to enhance their compliance
practices, they not only mitigate legal risks but also contribute to a culture of
transparency, trust, and ethical conduct within the global supply chain (Kimani, et
al., 2020). 4. Innovation in Supply Chain Processes In the fast-paced realm of
supply chain management, where adaptability and efficiency are paramount,
traditional methods often fall short in meeting the demands of the modern business
landscape. Innovation has become the cornerstone of success, and block chain
technology is emerging as a catalyst for transformative change (Khuan, et al.,
2023). This paper explores how block chain is breathing new life into supply chain
processes, fostering innovation in ways that were once thought to be on the horizon
of possibility. Traditional supply chain management has long relied on established
processes, often hindered by paper trails, manual interventions, and a lack of
real-time information. Block chain’s decentralized and secure nature provides a
foundation for innovation by offering an alternative to these archaic practices,
unlocking new possibilities for efficiency and collaboration. Among block chain’s
standout features are smart contracts, self-executing contracts with predefined
rules. These contracts automate various aspects of supply chain operations, from
order processing to payment verification. By eliminating the need for
intermediaries and reducing the risk of errors, smart contracts revolutionize the
efficiency and reliability of supply chain processes. The transparency offered by
block chain allows for real-time visibility into the entire supply chain (Mik,
2017). This visibility, coupled with the ability to capture and store vast amounts
of data, empowers businesses with the tools for predictive analytics. By analyzing
historical and real-time data, organizations can make informed decisions, optimize
inventory management, and anticipate potential disruptions before they occur. Block
chain doesn't operate in isolation; it seamlessly integrates with other emerging
technologies, such as the Internet of Things (IoT) and Artificial Intelligence
(AI). The marriage of block chain and IoT enables the creation of a connected
ecosystem where devices communicate and transact autonomously (El-Masri, et al.,
2021). Meanwhile, AI can process and analyze data from the block chain, extracting
valuable insights and driving continuous improvement in supply chain processes.
Block chain's shared ledger facilitates trust among stakeholders in the supply
chain. This trust forms the basis for collaborative ecosystems where partners can
share data securely, streamline communication, and collectively work towards common
goals (Rejeb, et al., 2021). Collaborative innovation becomes a reality as
businesses forge partnerships based on a foundation of transparency and
accountability. The efficiencies introduced by block chain open the door to novel
business models. Decentralized marketplaces, for instance, can emerge, allowing
direct interaction between buyers and sellers (Kyprianou, 2018). This not only
eliminates unnecessary intermediaries but also provides small and medium-sized
enterprises (SMEs) with broader market access, fostering a more inclusive and
dynamic business environment. As supply chain processes evolve, innovation stands
as a key differentiator between industry leaders and followers. Block chain's
influence in supply chain management extends far beyond efficiency gains; it
fosters a culture of continuous improvement, collaboration, and adaptability. By
embracing block chain technology, businesses are not just optimizing their current
processes; they are pioneering a new era of supply chain innovation that promises
to transform tomorrow's commerce landscape. International Journal of Science and
Research Archive, 2024, 11(01), 173–181 177 4.1. Novel Business Models and
Collaborative Ecosystems In the ever-evolving world of supply chain management,
traditional business models are being redefined, and collaborative ecosystems are
emerging as key drivers of innovation. This paper explores how block chain
technology is instrumental in reshaping business paradigms, fostering novel models
and collaborative ecosystems that transcend the boundaries of conventional supply
chain practices. Block chain's ability to facilitate secure and transparent
transactions without the need for intermediaries has given rise to decentralized
marketplaces. These platforms empower direct interactions between buyers and
sellers, eliminating unnecessary layers in the supply chain (Chen, et al., 2007).
This not only reduces costs but also provides businesses with more direct access to
customers, promoting a peer-to-peer marketplace environment. Block chain enables
the tokenization of physical and digital assets within the supply chain. Assets
such as inventory, products, or even production capacities can be represented as
digital tokens. This opens up new avenues for fractional ownership, allowing
businesses to explore innovative financing models and creating liquidity in
traditionally illiquid assets. Block chain's decentralized ledger serves as a
shared source of truth for all participants in the supply chain. This transparency
fosters collaborative networks where stakeholders can securely share information
(Parris,
et al., 2016). Whether it's sharing demand forecasts, inventory levels, or
production schedules, this real-time collaboration reduces information asymmetry
and enables more efficient decision-making across the entire supply chain
ecosystem. Smart contracts, powered by block chain, automate and execute predefined
actions when specific conditions are met. This functionality extends beyond
automation, paving the way for dynamic agreements. Contracts can adapt to changing
circumstances, offering a level of flexibility and responsiveness that was
previously unattainable. This dynamic nature of smart contracts is particularly
valuable in collaborative ecosystems with multiple stakeholders (Wang, et al.,
2019). Block chain's transparent and secure nature facilitates enhanced
collaboration with suppliers and partners. It streamlines the procurement process,
ensures transparency in transactions, and reduces the risk of disputes. Businesses
can build more robust relationships with suppliers, creating an environment of
trust and accountability. The decentralized and open nature of collaborative
ecosystems powered by block chain levels the playing field for businesses of all
sizes. Small and medium-sized enterprises (SMEs) can participate in these
ecosystems without the barriers that traditional supply chains may impose. This
inclusivity fosters innovation and diversification within the supply chain,
creating a more resilient and adaptable ecosystem. Novel business models are
emerging with block chain facilitating circular supply chains. Products are
designed with recycling and reuse in mind, and block chain ensures transparent
tracking of materials throughout their lifecycle. This not only aligns with
sustainability goals but also opens up opportunities for businesses to innovate in
the way products are manufactured, consumed, and repurposed. Block chain's
influence on novel business models and collaborative ecosystems in supply chains is
a transformative force. As businesses embrace decentralized marketplaces,
tokenization of assets, and dynamic smart contracts, they are not only optimizing
their operations but also fostering a culture of innovation and inclusivity.
Collaborative networks powered by block chain redefine how information is shared,
decisions are made, and relationships are built across the supply chain. The future
holds exciting possibilities as block chain continues to evolve, enabling even more
innovative business models and collaborative ecosystems (Mougayar, 2016). As
businesses navigate this transformative landscape, those that leverage block
chain's capabilities to foster collaboration, transparency, and innovation will be
at the forefront of a new era in supply chain management. 5. Challenges and
Considerations While block chain technology holds immense promise in
revolutionizing supply chain management, its adoption is not without hurdles. This
paper delves into the challenges and considerations that businesses must navigate
when embracing block chain for their supply chain processes. Understanding these
complexities is crucial for organizations seeking to unlock the full potential of
block chain and address the intricacies of modern supply chain management. Block
chain's decentralized nature has led to the proliferation of various platforms and
protocols. The lack of st