by Dr. Sri Gaddam, CEO, ERPA Group
Blockchain is one of the technologies grossly underutilized across industries. This is because there is a common erroneous belief that the application of blockchain is limited to cryptocurrency. However, organizations that understand the potential of blockchain have continued to develop blockchain tools for maintaining a competitive advantage and improving the quality of products and services. Businesses are already applying blockchain technology in ways that include physical asset traceability, clinical supply chain, global trade finance, cross-border payment, and remittances, generating alternative sources of capital, protecting data from loss and breach, and creating platforms for trade activities.
This is occurring in every industry and more jurisdictions globally. Deloitte's report shows that blockchain adoption is reaching a turning point where businesses are moving from blockchain tourism and exploration to building practical business applications. For instance, financial services and Fintech start-ups are leading in blockchain development. Besides, more organizations in sectors like media, telecommunications, life science, health care, and governments are expanding and diversifying their blockchain initiatives.
How do blockchain impact businesses, the workforce, and society?
In adopting the use of blockchain technology, businesses get to use a technology that is secure, efficient, transparent, and cost-effective. Here are the major ways blockchain impacts the sectors listed above.
Impact on Businesses: Blockchain has made a significant impact on businesses currently using this technology in optimizing processes and streamlining tasks. A report by International Data Corporation showed that blockchain spending is anticipated to reach 12 billion by 2022. This is because so many organizations have realized the potential disruptive benefits that this technology offers. One of the significant benefits that the blockchain technology offers to businesses is that it helps to streamline the processes and reduce friction between parties while increasing transiency. Enterprise blockchain makes use of validated and shared ledger to guarantee the quality of information, goods, and services shared on the network. It also uses smart contracts to execute business agreements and promote transparency. Besides, blockchain increases trust between parties on a network and gets rid of middlemen. The blockchain network is also beneficial to businesses that have a lot of accounting tasks to perform. This is because the transparency provided by the blockchain can reduce the time spent by auditors in validating transactions. Many large accounting and audit firms like Deloitte are already using blockchain to promote transparency and streamline tasks. Furthermore, blockchain technology is beneficial to human resource personnel tasked with the responsibility of planning, recruiting, hiring, and interviewing new staff. A report by the Society for Human Resource Management showed that blockchain could be used in modernizing the hiring process and helping HR professionals pick the right candidate quickly while preventing inconsistencies in candidate information. Other business areas where the blockchain network is beneficial is in the marketing and sales departments that have significantly suffered from fraud and is even estimated to lose about 44 billion USD by 2022.
However, blockchain technology can reduce "click frauds" while enabling marketing executives to reach their targets in less time.
Impact on Workforce: One of the major effects that blockchain technology has in the job market is the increase in search of tech-savvy professionals who are specialists in artificial intelligence and web services. A report by Forbes shows that the demand for Blockchain Engineers has skyrocketed rapidly in the last few years. To collaborate with this claim, another report by hired.com shows that in the last few years, there has been a 517% increase in demand for software engineers with blockchain development skills.
Besides, in the future, it is expected that there will be more demand for technical writers, machine learning specialists, security and encryption specialist, web developers, and blockchain engineers who are tasked with helping businesses adapt to the use of this technology.
Furthermore, non-tech jobs like business representatives, community development managers, financial analysts, journalists and writers, marketing managers, sales, and customer support specialists are also looking promising because they are not likely to be replaced by machines.
However, blockchain also puts some jobs at risk; this is because blockchain technology eliminates the needs of intermediaries. Therefore jobs like insurance, real estate, and travel agencies are largely threatened. Other jobs that will be affected are those that have to do with office paperwork.
Impact on Societies: Furthermore, blockchain also has some positive impacts on society. Experts opine that blockchain can eliminate poverty in the future, prevent economic crises, and even stabilize the world's economy.
This is because a move to virtual currencies can help banks have clear visibilities of customer's net worth. In developing countries where access to banks may be difficult, blockchain can help people store values that can be spent in the future. This implies that the blockchain network also eliminated the need for transactions to be subjected to middlemen and corrupt government officials who try to take their cuts first. Besides, blockchain removes the need for remittance; it allows people in a different part of the world to transfer currency instantly without the need to pay remittances to intermediaries or agencies. Furthermore, blockchain also has the possibility of reforming elections and democracy. Although this might sound strange, it is factual. This is because non-financial record like votes stored on the blockchain offers a digitalized pathway to better and faster elections.
As a technology of the future, the blockchain is based on a decentralized system where all users can choose to remain anonymous in their transactions. Business, societies, and governments that want to stay ahead are already embracing its use due to the so many benefits it offers.
Despite its advantages, one of the major limitations that blockchain offers is its limited speed, which is measured by the number of transactions they are capable of managing per second. Due to this, their use is strongly limited in systems that need to process a massive amount of transactions.
However, there are currently plans to make the block of transactions on the chain bigger by using a consensus mechanism that allows participants to agree efficiently and make the system transparent enough to process more data easily.
About the author
Dr. Gaddam is a seasoned entrepreneur, angel investor, and author. Dr. Gaddam' s greatest accomplishment lies in raising ERP Analysts, Inc. from a two-person organization to eighty-five-million-dollar firm. ERP Analysts, Inc. has been recognized as one of the fastest-growing companies by Inc. 5000 for ten years, Deloitte Fast 500, & Business First Fast 50 for several years. ERP Analysts is recognized as a “Best Places to Work” in Ohio for several years (www.erpagroup.com). Dr. Gaddam graduated the Doctor of Management (DM) from Case Western Reserve University, MBA from the Ohio State University, and the Owner President Management program (OPM 43) from Harvard Business School. He is the author of the book “Destination Success: Discovering the Entrepreneurial Journey” and also co-author of “Roadmap to Success,” with Deepak Chopra, Ken Blanchard, and other entrepreneurial leaders.