IBM Blockchain will apply the new TYS technology to TradeLens. The IBM project plans to expand globally.
IBM has launched a new blockchain project called Trust Your Supplier (TYS), with large firms such as Anheuser-Busch Inbev, GlaxoSmithKline, Lenovo, Nokia, Schneider Electric and Vodafone already on board.
It was announced on Monday, August 5th, 2019, that TYS has joined IBM’s successful supply chain and blockchain logistics tracking consortia, among which are Food Trust and TradeLens.
It was explained that TYS aims at incorporating suppliers, a generic term related to a wide and varied range of information, such as ISO certifications, bank account data, tax certifications, insurance certificates and other supplier data necessary for exchanging purchase orders and invoices.
Marie Wieck, general manager of IBM Blockchain, said that the process of incorporating data is normally performed manually at many companies, even at those with very efficient supply chains, only in terms of the investigation and validation of those suppliers. She noted that getting a new supplier to join quickly, especially when new capabilities emerge every day, is critical to the speed with which new products and services are introduced.
Renee Ure, Chief Supply Chain Officer for Lenovo’s Data Center Group, stated that through TYS both buyers and suppliers will the see the procurement benefits of blockchain through reductions in cost, complexity and speed.
In retrospect, business projects that use a blockchain have the reputation of advancing at a glacial pace, moving from proof of concept (PoC) to pilot testing and, if there is luck, to live production.
However, in this case, IBM has emerged with a fully formed live production blockchain.
Big Blue began working on the project internally with its own purchasing division and is using the Blockchain to manage 4,000 of its 18,500 suppliers. IBM said that it expects to see a reduction from 70% to 80% in the cycle time for new existing suppliers, with a reduction potential of 50% in administrative costs within its own business.
It was reported that TYS is currently limited to existing participants, with commercial availability plans in the third quarter of the year. Wieck said that, for now, its footprint is limited to North America, but the goal is a global network.
Network of Networks
A key innovation at the heart of TYS is a “digital passport” to identify the provider in the blockchain network.
One of the first IBM Blockchain partners, Chainyard, who also relies on Hyperledger Fabric, helped design this aspect of the project. Validation processes by third parties such as Dun & Bradstret, Ecovadis and RapidRatings provide external verification or auditing capabilities for suppliers through the passport.
Wieck indicated that the digital passport is specifically designed for TYS. However, like most things done by IBM, it was created with the vision of using open interfaces.
In that case, some facets of TYS could also be applicable to TradeLens, the IBM Blockchain ecosystem launched jointly with Maersk in 2018. Wieck said that there are many examples of shared documents, currently used, that could be expanded with the network of TYS providers.
She commented that TradeLens, for example, is working on optimizing invoice settlement, factoring and resolving invoice disputes.
Finally, Wieck explained that they have been talking about the notion of interoperability among blockchains, the idea of a network of networks that can expand economies.
By Willmen Blanco