IBM and blockchain consultancy Chainyard launched a blockchain network to improve manual supply chain management.
The Trust Your Suppliers network is designed to improve supplier qualification, validation, onboarding, and life cycle information management. The companies said blockchain technology could support the movement of $2 trillion of goods and services annually by 2023, citing research from Gartner.
IBM said 18,500 of its suppliers globally would use the Trust Your Supplier Network. Four thousand of its suppliers in North America would begin using the network in the next few months. Anheuser-Busch InBev, Cisco GlaxoSmithKline, Lenovo, Nokia, Schneider Electric, and Vodafone are founding participants. The company said IBM Procurement projected a reduction of 70% to 80% in the time required to onboard new suppliers. The company said it saw a possible 50% cut in in administrative costs to its own business.
The companies said the network also results in a lower risk of fraud and error compared with current supply-chain management systems that rely on manual processes that can make it difficult to verify identities and track documents across the supply chain.
In an interview with Supply Chain Management Review, David Post, managing director of Blockchain Ventures, said more verticals would be announced as the network evolves.
“Right now, it’s inning number one,” Post said. “We’ll add more pharma and apparel players later in the game.”
The Trust Your Supplier network is built on the IBM Blockchain Platform and hosted on the IBM Cloud. IBM and Chainyard plan to make it commercially available beyond the existing participants in the third quarter of 2019.
“Blockchain has the ability to completely transform how companies onboard and manage their supplier network for the future,” said Renee Ure, chief supply chain officer for Lenovo’s Data Center Group. “Through Trust Your Supplier, both buyers and suppliers will the see the procurement benefits of blockchain through reductions in cost, complexity, and speed.”