Supply Chain Management: An International Journal

Understanding blockchain technology for future supply chains: a systematic literature review and research
agenda
Yingli Wang, Jeong Hugh Han, Paul Beynon-Davies,
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 Understanding blockchain technology for
future supply chains: a systematic literature
review and research agenda
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies
Cardiff Business School, Cardiff University, Cardiff, UK

Abstract
Purpose – This paper aims to investigate the way in which blockchain technology is likely to influence future supply chain practices and policies.
Design/methodology/approach – A systematic review of both academic and practitioner literature was conducted. Multiple accounts of
blockchain adoption within industry were also consulted to gain further insight.
Findings – While blockchain technologies remain in their infancy, they are gaining momentum within supply chains, trust being the predominant
factor driving their adoption. The value of such technologies for supply chain management lies in four areas: extended visibility and traceability,
supply chain digitalisation and disintermediation, improved data security and smart contracts. Several challenges and gaps in understanding and
opportunities for further research are identified by this research. How a blockchain-enabled supply chain should be configured has also been
explored from a design perspective.
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Research limitations/implications – This systematic review focuses on the diffusion of blockchain technology within supply chains, and great care
was taken in selecting search terms. However, the authors acknowledge that their choice of terms may have excluded certain blockchain articles
from this review.
Practical implications – This paper offers valuable insight for supply chain practitioners into how blockchain technology has the potential to
disrupt existing supply chain provisions as well as a number of challenges to its successful diffusion.
Social implications – The paper debates the poential social and economic impact brought by blockchain.
Originality/value – This paper is one of the first studies to examine the current state of blockchain diffusion within supply chains. It lays a firm
foundation for future research.
Keywords Design, Supply-chain management, Impact, Systematic literature review, New technology, Information transparency
Paper type Literature review

1. Introduction However, the blockchain as a technology has potential to

disrupt many other domains of organisation, including the
Considered as one of the most disruptive technologies, the supply-chain. As a blockchain allows secure exchange of data in
blockchain (a peer-to-peer distributed data infrastructure) a distributed manner, it starts to impact upon the way
enables the creation of decentralised currencies (e.g. Bitcoin), organisations are governed, supply chain relationships are
self-executing digital contracts (smart contracts) and intelligent structured and transactions are conducted. Integrated with
assets that can be controlled over the internet (smart property) other technologies, like the Internet-of-Things (IoT), the
(Kosba et al., 2016; Wright and De Filippi, 2015). Originally blockchain could be used to create a permanent, shareable,
created by Nakamoto (2008), recent research on the actionable record of every moment of a product’s trip through
blockchain has focussed primarily on financial transactions and its supply chain, creating efficiencies throughout the global
distributed ledger systems (Pilkington, 2016). Blockchain economy. Improved visibility facilitated through such
technology uses a shared data infrastructure that updates itself technology may also afford product traceability, authenticity
in real-time and can process and settle transactions in minutes and legitimacy.
using computer algorithms, with no need for third-party Although many speculate about the impact of blockchain
verification. Within the financial sector, the blockchain is technology upon supply chains, current understanding of its
proposed as a means for the management of financial potential remains limited. As the development and diffusion of
transactions without the need for trusted intermediaries such as this technology is still in its infancy, a systematic review of
banks. current thinking is likely to assist both academics and
managers’ sensemaking, where they become aware of this
technological innovation, sense its potential disruptive effect,
The current issue and full text archive of this journal is available on make an initial exploration of its efficacy and decide whether to
Emerald Insight at: www.emeraldinsight.com/1359-8546.htm

Received 31 March 2018

Revised 12 July 2018
Supply Chain Management: An International Journal 27 September 2018
© Emerald Publishing Limited [ISSN 1359-8546] 2 October 2018
[DOI 10.1108/SCM-03-2018-0148] Accepted 4 October 2018
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

either embrace or ignore it. A systematic review will provide a A blockchain is an encoded digital ledger that is stored on
solid foundation by cultivating a deep understanding of multiple computers in a public or private network. Blockchains
blockchain technology when its tangible benefits are unclear, comprise data records or blocks. As each transaction occurs, it
disruptive effect unpredictable and its diffusion path is put into a block. Each block is connected to the one before
ambiguous. A systematic review will separate the hype from and after it. Each block is added to the next in an irreversible
reality by identifying evidence where the blockchain has chain and transactions are blocked together – hence the term
potential to disrupt supply chains (both positively and “blockchain”. Once these blocks are collected in a chain, they
negatively), identify challenges to its future diffusion and offer cannot be changed or deleted by a single actor. Instead, they are
agendas for future research. verified and managed using governance protocols (Cheng et al.,
Our systematic literature review aims to answer the following 2017) (Figure 1).
question: In a blockchain, no single party controls the data. The entire
data infrastructure is visible to all parties. Every party can verify
RQ1. How will the blockchain influence future supply chain the records of its transaction partners directly, without an
practices and policies? intermediary or distributed consensus mechanism. The
verification process, along with modern encryption methods,
We further set the following research objectives (ROs) in can effectively secure data on blockchain ledgers against
relation to this research question: unauthorised access or manipulation. As existing blocks in the
RO1. To identify drivers to blockchain deployment within chain cannot be overwritten, users always have access to a
supply chains comprehensive audit trail of activity (Miles, 2017). As such, the
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bigger the blockchain network, the more tamper-resistant the

RO2. To identify areas where the blockchain provides the blockchain will be. The decentralised storage of data reduces
most value for supply chain management the risk of single point of access failure associated with
centralised databases.
RO3. To investigate the challenges/barriers to further Two main types of blockchain are distinguished in terms of
diffusion of the blockchain within the supply chain access control – who can read a blockchain, submit transactions
to it and participate within the consensus process. Within public
RO4. To develop elements of a future research agenda for the
blockchains, every transaction is public (“permissionless”), and
blockchain within the supply chain.
users can remain anonymous. The network typically has an
This paper begins with a high-level description of the incentivizing mechanism to encourage participants to join the
architecture of blockchain technology, followed by a discussion network. Bitcoin and Ethereum are examples of public
of the methodology used within our investigation. From our blockchains. Within permissioned blockchains, participants need
research database, we identified four major ways in which the to obtain an invitation or permission to join. Access is controlled
blockchain is approached within the extant academic supply by a consortium of members (consortium blockchain) or by a
chain literature. We further provide a summary of the latest single organisation (private blockchain).
developments in practice. This is followed by a discussion of New applications of the blockchain technology, beyond
financial transactions, are being experimented with and
the insights the literature provides in terms of our research
exploited in sectors such as financial services, insurance, food,
objectives. We conclude by highlighting our contribution to the
health care and government. Within the supply chain, some
literature, as well as considering certain limitations of the
compelling cases of blockchain adoption have been identified.
research.
For example, the blockchain can be deployed as a means of
enabling a record of complete provenance details for each
2. Blockchain technology component part of an aircraft. These details can be accessed by
Technically, the blockchain refers either to a distributed data each manufacturer within the production process (Gupta,
infrastructure or a method for recording data using a crypto- 2017).
analytic hash function. Blockchains consist of nodes situated
upon some communication network which use some common 3. Methodological approach to literature review
communication protocol – each node on the network stores a
To help build transdisciplinary understanding of blockchain
copy of the blockchain and a consensus function is developments for supply chain transformation, we have
implemented to verify transactions to preserve the immutability conducted an integrated and systematic review of both
of the chain (transactions cannot be changed) (Bashir, 2017).
The blockchain can be perceived as another application layer
Figure 1 A standard blockchain string
that runs on top of internet protocols and that enables
economic transactions between relevant parties. It can also be
used as a registry and inventory system for recording, tracing,
monitoring and transacting assets (tangible, intangible or
digital). Some think of the blockchain as a giant spreadsheet
appropriate for registering all types of assets and an accounting
system for transacting such assets on a global scale (Swan,
2015).
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

academic and practice literature. A systematic review of our review spans the period 2008 to 2017. Multiple articles
academic literature is a well-established method that provides a discuss the general features of blockchains (e.g. ABI inform
replicable, transparent and auditable trail of the reviewers’ global generates 5,667 articles) within this period. To ensure
decisions, procedures and conclusions (Bryman, 2012; academic rigour and quality, only peer-reviewed scholarly
Tranfield et al., 2003). The systematic review approach can articles were captured (Saunders et al., 2012; Tranfield et al.,
explore the literature in fields that aim to elucidate 2003). This method generated a reasonable number of articles
interventions with specific benefits such as cause and effect to explore, increasing the credibility of selected articles. Other
analysis (Saunders et al., 2012; Tranfield et al., 2003). The terms such as a digital ledger, distributed ledger and shared ledger
method allows for systematic analyses and syntheses of relevant were used as synonyms for the blockchain. To be as
research by breaking down each study into its constituent parts comprehensive as possible, the keyword string used to collect
(Bryman, 2012). This enables a conceptual analysis of the articles related to blockchain technology was “blockchain” or
research objects (Tranfield et al., 2003). We follow the “digital ledger” or “distributed ledger” or “shared ledger”.
structured approach outlined by Tranfield et al. (2003) and As blockchain is an emerging topic in supply chain
detailed further by Denyer and Tranfield (2009) and Rousseau management, it is necessary that we review research from other
et al. (2008). It is worth noting that our systematic literature fields such as engineering, innovation, IT and finance where
review does not include published books, mainly because some the topic is more established. This approach afforded us further
these publications do not usually go through rigorous academic insights about the implications of blockchain for supply chain.
peer reviews. However, we have used certain popular books on As pointed out by Holmström et al. (2009), navigating multiple
the blockchain such as Antonopoulos (2014), Mougayar domains of inquiry is of great value for making theoretical
(2016), Tapscott and Tapscott (2016), Bashir (2017) and abstractions and abductive reasoning. Abduction of tested
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Hofmann et al (2017) to help us understand the ways in which results from other field to supply chain management will serve
the blockchain is framed in popular literature. as the basis for explorative design science research. We
As with many areas of technological innovation, academic identified that, due to the rapid development of blockchain
studies tend to lag in their application of technologies in technology, a large majority of articles were published in the
practice. Solely relying on journal publications would provide a first half of 2017. However, to ensure the maximum inclusion
rather narrow view of the literature. Reviewing the current state of relevant publications within our review, an additional search
of practice is therefore essential to provide a solid ground for was conducted in December 2017 to January 2018, prior to the
understanding how blockchain technology is being used in submission of this paper. Finally, relevant literature discussed
practice. A wide range of sources was consulted to identify the in these papers identified, but not captured by our keyword
trend of current industrial exploitation and development of the search, was reviewed for a more comprehensive analysis.
blockchain.
For instance, public and industrial databases, such as Lloyd’s 3.2 Initial selection of articles
List insights (maritime intelligence), European Commission Nine integrated databases that cover heterogeneous disciplines
foresight studies and OECD reports, provide a good indication of were used to collect the articles: ABI Inform Global, Emerald,
current blockchain development efforts at the European and IEEE Explore, Jstor, Science Direct, Scopus, Springer, Taylor
international levels. Industrial forums and trade associations, and Francis and Web of Science. To narrow down the research
such as the Chartered Institute for IT, the Chartered Institute of scope to that of supply chains, only articles including the terms
Logistics and Transport, the Global Shippers’ Forum and the “logistics”, “supply chain”, “demand chain” and “value chain”
EU Blockchain Observatory and Forum, were surveyed on were selected. After this initial review, our search acquired 227
blockchains because these stakeholders tend to be at the forefront articles.
of discussions and actions on emerging technological trends. The
publications of leading IT service providers and consulting 3.3 Contents screening and complementary search
companies, such as IBM, Gartner and McKinsey, were also We used a wide definition of supply chain management to
closely examined, as these represent the latest thinking on include articles related to freight operations, warehousing,
blockchain developments. Popular blockchain platforms, such as integrated logistics, retail/global/cross-border supply chain
Hyperledger, R3 Corda, MultiChain and Ethereum, were visited operations, humanitarian logistics, global trading including
frequently to gather information on the latest developments. shippers and intermediaries. Titles, keywords and abstracts of
Further insights were gained by attending industrial workshops, articles were read to determine their suitability for inclusion. If
in which industry leaders discussed their latest efforts in required, the main texts of the articles were also closely
blockchain developments. All these activities led us to identify a investigated. Articles that clearly specified aspects of the
list of promising supply chain-related blockchain initiatives, blockchain that support supply chain philosophy or practices
which we discussed in Section 5. Information obtained in this received further scrutiny (Bryman, 2012). Moreover, for the
way from practice helped in our interpretation and analysis of the identification of supply chain activities or processes supported
academic literature and particularly informed our identification by the blockchain, articles clearly addressing the purposes of
of future research opportunities. blockchain use were selected (Bryman, 2012). Articles that did
not use blockchain technology as their primary focus, such as
3.1 Pilot review articles using the blockchain to explain Bitcoins not in the
A pilot systematic literature review was used to decide upon the context of supply chain management were excluded. This
appropriate breadth for the final literature review. Given that process retained 24 articles out of 227 articles. Our initial
the term blockchain was introduced in 2008 (Nakamoto, 2008), literature review took place between June and December 2017.
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

An additional search using the same method (i.e. initial article concentrate on the lack of trust in product/information
selection and contents screening) was conducted between legitimacy caused by information asymmetries within
December 2017 and January 2018, which identified five more supply chain practices. Various data architectures or
articles. The total list of 29 selected articles are summarised in conceptual models are proposed to resolve such
Table I. asymmetries. A limited number of papers report system
performance results after trial runs, providing valuable
4. Current perspectives and research efforts on insights into the practicality and cost implications of
blockchains blockchain deployment.

4.1 State of art developments in academia Although all streams of research contribute to our knowledge of
Although the blockchain is still in its infancy, supply chain the emerging technology of blockchain, the development of
researchers have started to recognise its potential for supply prescriptive knowledge tends to be field problem driven and
chains. Its expected value was discussed in the literature, and solution oriented, describing and analysing alternative courses of
actions/implementation strategies required to materialise its action in dealing with certain blockchain-related problems. This
value were also proposed. However, the overall state of such design-oriented approach enhances the relevance of academic
research remains generally at the sense-making and exploratory research to practice. If these solutions are “well-tested, well-
stage. understood and well-documented general solutions”, they can
Blockchain deployments in practices are mostly in the pilot then be used as the basis for the design of a “specific variant of it
stage, with no evidence of large-scale adoption within the for a specific case” in practice (van Aken, 2005, p. 23). However,
supply chain. Consequently, there is limited empirical evidence we are not yet at the stage of architecting general blockchain
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as to how the blockchain has benefited or disrupted existing solutions, as almost all initiatives in practice are still being tested
supply chains. We found four major ways in which the in the piloting stage, which we shall discuss in the following
blockchain was approached within extant supply chain section.
literature. A small part of this literature describes pilots that
applied the blockchain in agriculture and pharmaceuticals. 4.2 State-of-the-art developments in practice
Some articles addressed the potential of blockchains for the Many proof-of-concept (POC) or piloting schemes have been
supply chain while others predicted how blockchains will developed in recent years, particularly in 2017, using
impact supply chains. Finally, certain articles diagnose specific blockchain technology. IBM alone is working with hundreds of
problems with contemporary supply chains and propose the enterprises on blockchain implementations (IBM, 2018).
blockchain as a solution to address these issues. Application-specific implementations, such as Everledger for
We categorised the studies into four types – descriptive, diamond tracking and Filament for IoTs, have emerged.
conceptual, predictive and prescriptive. However, concrete, real-life, end-to-end implementations are
 Descriptive (3 articles, 10%): Descriptive papers answer unavailable as of this writing, providing very limited evidence
the question: “How has the blockchain been deployed in the for us to assess the true impact of blockchain technology on
supply chain?” Piloting schemes in the agri-food and supply chains. Because of the high level of uncertainty
pharmaceutical industries demonstrated the usefulness of associated with current blockchain development, identifying
blockchain applications in product provenance and precisely those areas where blockchain technology may hold
traceability. promise compared with those areas where uptake is unlikely is
 Conceptual (4 articles, 14%): This stream of literature therefore not possible.
seeks to answer the question: “What does the blockchain Nevertheless, a review of emerging practices within the
mean for the supply chain?” To provide a better supply chain discipline offers us some useful indications on the
understanding of blockchain technology, conceptual latest developments. This complements insights gained from
papers interpret its underlying values, disruptive our review of the academic literature. Table II presents a
characteristics and consider implications of the blockchain summary of 17 popular piloting cases we have identified, with
for supply chain management. They also debate whether the focuses ranging from product provenance and traceability,
the blockchain will provide a new paradigm for supply international shipping and cross-border supply chain to trade
chain management. finance, secure data exchange and record, smart contracts and
 Predictive (11 articles, 38%): This stream of literature social impact. Whilst the main themes evident within this
deals with the question: “Where will the blockchain penetrate material are largely in line with the academic literature, we do
supply chains?” It does so by considering possible observe a broader range of applications in practice. For
application areas for the blockchain within the supply instance, blockchain pilots on social impact and trade finance
chain. The proposed application areas include: cross- have received less attention in the academic literature but are
border digital integration of multiple stakeholders, actively explored in practice.
product traceability, financial settlement, process We summarise some common themes observed from the
automation and contract management. cases in this section, and then we embed our further discussion
 Prescriptive (11 articles, 38%): This stream of literature of piloting schemes or use cases in Section 5.2, where we
tackles the question: “How should the blockchain be deployed explore areas in which the blockchain may provide the most
within supply chains?” Prescriptive papers tend to diagnose value for supply chain management. In Section 5.4, we
current problems within supply chain practices and showcase some less-known but promising blockchain
provide technical and business solutions. They applications.
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

Table I List of articles identified through systematic literature review

Research
types Paper Focus Applied areas Key findings
Descriptive Bocek et al. (2017) Traceability and Pharmaceutical industry Blockchain allows pharmaceutical supply chains to monitor
Papers integration of IoTs of temperature and humidity over the transport of medical
(3 papers) blockchain products
Mackey and Nayyar Anti-fraud Pharmaceutical industry A few blockchain use cases and initiatives were identified and
(2017) briefly discussed for security and anticounterfeiting purposes
Lu and Xu (2017) Product traceability Agri-food industry Using the originChain case demonstrates the value of
blockchain in tracing the origin of products across complex
supply chains. This blockchain system requires a transparent,
tamper-proof metadata infrastructure that is also adaptable to
changing environments and regulations
Conceptual Hull et al. (2017) Challenges of smart Global supply chains Single trusted source of data from blockchain will contribute to
Papers contract implementation streamlined data sharing and dispute resolution. Smart
(4 papers) in supply chains contracts will prevail in supporting supply chain collaboration
but several challenges need to be addressed: diversity and
variation in country policies, product types, transport and tax
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rates; programming language, solution architectures,

interoperability and verification process
Mansfield (2017) Blockchain concept and Pharmaceutical, Blockchain’s impact will reach far beyond financial sectors
its future implications gemstones, airline providing ‘assurance as a service’ in the commercial world
industries
Patel et al. (2017) Blockchain concept, Multiple sectors Blockchain technology will revolutionise several financial and
technical fundamentals, non-financial sectors. However, it will also face security, legal,
application cases of regulatory and technological challenges
blockchain
Shireesh and Petrovsky Value and limitation of Pharmaceutical industry Blockchain will enable advances in authentication and
(2016) blockchain in verifying validation of supply chain information auditing process
material ingredients
Predictive Casey and Wong Product traceability Global supply chains End-to-end traceability and the encrypted inclusion of human
Papers (2017) beings to the supply chain audit is a significant value of
(11 papers) blockchain
Collomb and Sok Disintermediation effect Global supply chain Disintermediation in international trade finance and settlement
(2016) of blockchain will increase efficiency in cross-border operations
Glover and Hermans Product traceability Pharmaceutical industry Blockchain technology has the potential to improve the
(2017) traceability of a clinical trial supply chain and track patient
responses
Guo and Liang (2016) Disintermediation effect Global supply chains Disintermediation and digitisation of supply chain finance
of blockchain enabled by blockchain will enhance the efficiency in cross
border trade settlement
Korpela et al. (2017) Digital supply chain Manufacturing/physical Blockchain will enable hyper-levels of supply chain integration
integration distribution with end-to-end integration of product and process data
Kshetri (2017a) Integration of blockchain Manufacturing/physical Blockchain can play a key role in tracking the sources of
with IoTs distribution insecurity in supply chains and in handling crisis situations like
product recalls that occur after safety and security
vulnerabilities are found
Kshetri (2017b) Potential value of Global supply chains (in Blockchain will enable the promotion of transparency in
blockchain to reduce relation to the third international trade finance in the third world
corruption and fraud world economy)
Lee and Pilkington Transparency and supply Electronics industry Transparency and process integration in consumer electronics
(2017) chain visibility supply chain management will be enhanced by blockchain.
Areas where blockchains can affect supply chains include a
tamper-proof history of product manufacturing, handling and
maintenance, digital identity for ownership and packaging,
tendering across the supply chain through smart contracts and
engagement with consumers
(continued)
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

Table I

Research
types Paper Focus Applied areas Key findings
Shanley (2017) Supply chain security, Pharmaceutical industry Blockchain’s serializations of products and tracking of origin
traceability and technical will be significant value of pharmaceutical supply chains
obstacles
Wang et al. (2017) Transparency and Construction industry
Three types of blockchain-enabled applications are proposed to
traceability, contract and improve the current processes of contract management
asset management and (notarization), supply chain management (transparency and
challenges of traceability), and equipment leasing (asset management) for
implementation construction engineering management
Saberi et al. (2018) Information authenticity
Reverse logistics and Blockchain-enabled product life cycle assessment and end-of-
and product stewardship
product recycling life management will benefit reverse logistics industry
Prescriptive Engelenburg et al. Smart contract Global supply chains Followed a design science approach to develop a software
Papers (2017) architecture for business-to-government information sharing
(11 papers) for cross-border activities enabled by blockchain technology
Chen et al. (2017) Smart contract and smart Personal computer A blockchain-based supply chain quality management (SCQM)
inspection industry framework is proposed which consists of IoT sensor, blockchain
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data, contract and business layers

Li et al. (2017) Supply chain visibility Manufacturing/physical A framework that supports supply chain visibility by using a
and real-time tracking distribution hybrid (semi-open) P2P architecture is introduced, providing
the cost-effective real-time tracking information of shipments
to all stakeholders
Nakasumi (2017) Information symmetry Global supply chains A blockchain-based solution is proposed to address the
and capacity risk problems of double marginalisation and information
mitigation asymmetry in supply chain
Polim et al. (2017) Information integration Advanced transport A blockchain data structure is designed to promote fair
capability of blockchain systems development competition among 3PLs in a retailer-centred network and the
system removes the intermediary 4PL
Tian (2016) Product traceability Agri-food industry A conceptual framework for an agri-food supply chain
traceability system is proposed, integrating RFID and
blockchain technology
Tian (2017) Product traceability Agri-food industry To address the scale-up issue of blockchain application, a
decentralised traceability conceptual system based on IOTs and
blockchain technology was proposed. A scenario demonstrated
how it works in a food supply chain with Hazard Analysis and
Critical Control Points (HACCP)
Toyoda et al. (2017) Anti-fraud and product High value product A blockchain-based product ownership management system is
authenticity supply chains proposed for anti-counterfeit in the post supply chain. A POC
experimental system has been implemented on the Ethereum
platform and results demonstrate the cost for managing
products with the proposed system is less than US$1 when the
number of owner transfers is less than or equal to six
Weber et al. (2016) Inter-organisational Manufacturing/physical Specific techniques are proposed to integrate blockchain into
business process distribution the choreography of processes in such a way that no central
monitoring and authority is needed, but trust maintained in a collaborative
execution (smart process execution
contract)
Xu et al. (2017) Secure information Manufacturing and A supply chain on blockchain management system is proposed
integration and sharing physical distribution that uses a hybrid model and two-steps method to maintain a
decentralized ledger based on blockchain. It introduces a
protection mechanism to prevent supply information stored on
the ledger from being accessed by unauthorised participants
Yuan and Wang (2016) intelligent transportation Advanced transport A blockchain-based ITS (B2ITS) conceptual framework is
systems (ITS) and real- systems development proposed, highlighting its potential in supporting sharing
time ride-sharing economy in transport
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Table II A List of popular blockchain initiatives in practice

Case Supply chain Blockchain

no. Industrial focus Led by Case description (source of information) objectives platforms Source
1 Product provenance Walmart and other Since October 2016, Walmart has been working with IBM in a pilot To improve food safety, Hyperledger Russon (2018)
and traceability large food businesses study to trace food products in the blockchain. In April 2018, Walmart achieve product Fabric and IBM (2017c)
started to get suppliers involved in the blockchain. Following this, Dole, provenance and reduce
Driscoll’s, Golden State Foods, Kroger, McCormick and Company, fraud
McLane Company, Nestlé, Tyson Foods, Unilever, Walmart and others
started to collaborate with IBM to further champion the blockchain
2 Provenance Provenance, a UK social enterprise organisation, is one of the early To increase the integrity Ethereum Provenance
pioneers providing blockchain-enabled solutions for product tracking of certifications, as well (2017)
and tracing. This tech start-up has successfully piloted two projects: a) as ensure food
tracking tuna through southeast Asian supply chains in 2016 and b) provenance and fair
working with a large consumer cooperative to track fresh produce from payment
Understanding blockchain technology

its origin to the supermarket in 2017

3 Everledger In 2015, London-based start-up Everledger first started to securely track To create and track the Hyperledger Everledger (2018)
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

and trace the authenticated provenance of diamonds by using the best entire lifetime journey of Fabric
of emerging technology on a global digital ledger. Working with a range a diamond in a manner
of stakeholders across the diamond supply chain, Everledger has since that is accessible to all
encrypted the provenance of over 2 million diamonds in a short span of
three years
4 Airbus and others Airbus, the French aircraft maker, is looking to use blockchains to To create and maintain Hyperledger Alper (2018)
monitor the many complex parts that come together to make a jet trust in supply chains and Fabric
plane. A number of airlines have already expressed a keen interest in to automate records for
developing blockchain solutions, with the likes of Lufthansa, Air New complex products that
Zealand and British Airways already working with blockchain start-ups currently require
on ambitious projects. (https://cryptonews.com/news/airbus-rolls-royce- significant manual efforts
seeking-blockchain-air-parts-traceability-1700.htm)
5 International Maersk Working with IBM, Maersk did a POC in September 2016, tracking a To digitalise global trade Hyperledger Groenfeldt (2017)
shipping, cross- container of flowers from Kenya to Rotterdam. Following this, a few (paperless trade) and Fabric
border supply chain pilots, including the international shipment of electronics from provide end-to-end
Rotterdam to Newark, as well as that of Mandarin oranges from supply chain visibility
California and pineapples from Colombia to Rotterdam, were completed
in 2017
6 Hyundai Merchant HMM announced in September 2017 that it successfully completed its To allow secure Ethereum HMM (2017)
Marine (HMM) (South first blockchain integrated pilot voyage from South Korea’s Busan port information sharing
Korea) to China’s Qingdao port with reefer containers from August 24 to between multiple
September 4, 2017. Blockchain was applied not only to shipment stakeholders, reduce
booking but also to cargo delivery. HMM also tested and reviewed the paper work and ensure
combination of DLT with IoT through real-time reefer-container real-time monitoring of
monitoring and management on the vessel containers
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Table II

Case Supply chain Blockchain

no. Industrial focus Led by Case description (source of information) objectives platforms Source
7 Pacific International Following the signing of the MOU in August 2017, PIL, PSA and IBM To enhance the security, Hyperledger PIL (2018)
Lines (PIL) and the worked on a POC exercise to track and trace cargo movement from transparency and Fabric
Port Authority of Chongqing to Singapore via the Southern Transport Corridor. The pilot efficiency of the supply
Singapore (PSA) was considered successful in December 2017. The partners believed that chain network in
(Singapore) sufficient evidence now exists to show that the concept can be taken to southeast Asia
the next stage
8 Trade finance Daimler and Daimler AG and LBBW jointly used blockchain technology to execute a To make financial Hyperledger Daimler (2017)
Landesbank Baden- financial transaction. Through LBBW, Daimler launched a e100 million processes simpler and Fabric
Württemberg (LBBW) one-year corporate Schuldschein, in which savings banks more efficient and to
(Kreissparkasse) Esslingen-Nürtingen, Ludwigsburg and Ostalb, as well enable new business
as LBBW, acted as lenders. The entire transaction was digitally carried models
Understanding blockchain technology

out via blockchain technology, in cooperation with the IT subsidiaries

TSS (Daimler) and Targens (LBBW)
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

9 Foxconn and The financial services arm of iPhone manufacturer Foxconn (Taiwan) To provide supply chains unknown Soo (2017)
Dianrong partnered with the Chinese online P2P lender Dianrong to launch with easier access to
Chained Finance, which claims to be the first-ever blockchain platform funding at competitive
for supply chain finance. The two companies recently completed a rates
successful pilot and POC by securing funding for small and medium
enterprises (SMEs) in China that were otherwise unable to secure their
needed capital. (www.scmp.com/tech/leaders-founders/article/2102840/
blockchain-sharpens-dianrongs-edge-p2p-lending-small)
10 Skuchain CGI, a trade finance platform used by banks in 901 countries To establish seamless Hyperledger Market Insider
worldwide, and its banking partners successfully completed a POC in interoperability between (2017)
2017, which integrates CGI’s trade finance platform (CGI Trade360) and a trade platform and a
its blockchain-based platform (Skuchain Brackets) to demonstrate how supply chain execution
banks can provide trade finance services digitally to their customers platform
conducting business on blockchain B2B platforms
11 OriginalTrail OriginalTrail is a Slovenian IT company specialising in traceability and To assist in the financial Ethereum OriginTrail (2018)
quality control systems, and it created the cryptocurrency Trace Token. settlement between
The purpose of this currency is to serve as compensation for the multiple supply chain partners
nodes within a network that keep copies of transactional data
generated by supply chains. This may address the issue of high
transaction costs associated with the blockchain and would speed up
cash flow exchanges
12 Data security NHS Google’s DeepMind is working with Britain’s National Health Service To ensure the security of Unknown Suleyman and
and dispute (NHS) to deploy a private blockchain for creating robust audit trails that patient data Laurie (2017)
resolution track exactly what happens to personal data
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Table II

Case Supply chain Blockchain

no. Industrial focus Led by Case description (source of information) objectives platforms Source
13 FedEx FedEx, a multi-national shipping company, launched a pilot programme To streamline all data Ethereum Rajamanickam
using blockchain to store data for dispute resolution. The company exchanges in a secure and (2018)
comes into the blockchain sphere in the wake of a high-profile cyber- way Hyperledger
attack on its TNT express branch in Europe in the past year
14 Smart contract Slock.it Slock.it, a German start-up, has partnered with energy giant RWE to To speed up, simplify and Ethereum Allison (2016)
transform the way electric cars are charged. Cars with digital wallets automate the electric car
will be able to ‘talk’ to autonomous electric charging stations which use charging process and
Understanding blockchain technology

smart contracts to allow users to rent the station, put up a deposit, payment settlement
charge their car and then get their deposit back
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

15 Barclays Barclays Corporate Bank recently partnered with a start-up, Wave, a To streamline cross- Waves Ream et al.
platform that stores bill-of-lading documents in the blockchain and uses border trade finance (2016)
smart contracts to log change of ownership and automatically transfer
payments to ports upon arrival
16 Social impact Moyee Coffee Moyee Coffee (www.moyeecoffee.ie) launched a pilot project in To create a fairer and Stellar Moyee Coffee
Ethiopia in November 2017 with blockchain pioneers Bext360 and the honest supply chain (a payment (2018)
FairChain Foundation to give all stakeholders access to data across the network)
entirety of the supply chain. At the point of collection, the Bext360
platform instantly creates cryptotokens. As the commodity flows
through the entire supply chain, new tokens are automatically created.
These tokens increase in value as the beans move through the supply
chain
17 WFP The Building Blocks pilot project by the World Food Programme (WFP) To reduce payment costs Ethereum WFP (2017)
initiated a POC in 2017 using an Ethereum-based blockchain technology associated with cash
to help refugees of the Syrian Civil War in the Azraq refugee camp in transfers, better protect
Jordan. As of January 2018, more than 100,000 people have received beneficiary data, control
food from entitlements recorded on a blockchain-based computing financial risks, and set up
platform. Refugees purchase food from local supermarkets in the camp assistance operations
by using an eye scan instead of cash, vouchers or e-cards more rapidly in the wake
of emergencies
Supply Chain Management: An International Journal
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

An important observation of blockchain initiatives in practice is that which perfectly mirrors every dimension of truth regarding
that most of them deploy permissioned blockchain solutions. events and transactions. Such truth has been described as a
Given the sensitivity of supply chain information, this is not “shared source of truth” (Michelman, 2017, p. 18), “one data”
surprising, as revealing proprietary details, such as demand, (Nakasumi, 2017, p. 144) or “one trusted source of data” (Hull
capacities, orders and prices, at all points of the supply chain to et al., 2017, p. 2). Trust arising from data security was also
unknown participants is unwise. Permissioned blockchains are discussed (Collomb and Sok, 2016; Patel et al., 2017).
also more effective at controlling the consistency and integrity Some researchers argue that geographically dispersed
of the data that are appended to the blockchain, which is critical facilities and trade partners often lead to disconnections and
for decision-making. complexity among supply chain actors. Therefore, acquiring
Many pilots feature some degree of centralised control. and maintaining reliable data is critical. In this context, the
Funding members often form a consortium, which then blockchain’s role is to provide seamless networks (Bonino and
determines the social structure of the network and how Vergori, 2017; Wang et al., 2017; Xu et al., 2017), entire
decisions are made. There tends to be a network orchestrator, visibility (Li et al., 2017) and symmetric information to all
who is likely one of the funding members, facilitating (Nakasumi, 2017). Such seamless connectivity and reliability
coordination and cooperation among the different stakeholders are also required for business ethics and social responsibility.
in a blockchain-based supply chain network. This orchestrator Due to the increasing concerns of food safety (e.g. horsemeat
plays a critical role in future-oriented value creation, scandal in the UK, toxic milk powder in China) (Tian, 2016,
appropriation and distribution among network members. In 2017) and sustainability related issues (e.g. child labour, fair-
addition to pursuing socio-economic gains, some consortia trade, organic products) (Abeyratne and Monfared, 2016),
consumers pay much more attention to the authenticity and
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have broader aims. For instance, Blockchain in Trucking

Alliance is a forum founded in August 2017 for the legitimacy of the products they purchase. They increasingly
development of blockchain technology standards and demand to know how, when and where products are sourced
education for the freight industry. and processed.
By design, the blockchain enables multiple supply chain Another motivational driver to blockchain deployment is
stakeholders to transact with one another without requiring an public safety and security. To prevent antisocial behaviours,
intermediary. Therefore, it seems to be best applied when a like terrorist attacks on ships and maritime containers,
problem across multiple parties exists, and these parties can Engelenburg et al. (2017) proposed the implementation of
each benefit from addressing the problem. This shared value blockchain-based customs systems. Mackey and Nayyar
encourages participation and incentivises collaborative (2017) argued that the grey market that commercialised fake
behaviours among participating members. Blockchain products calls for blockchain technology implementation.
technologies also allow competing organisations to become Corruption and fraud is a serious problem in some developing
involved in the same network. For instance, IBM Food Trust economies. Guo and Liang (2016) and Kshetri (2017b)
has multiple retailers on board (see Case 1). posited that the blockchain is required to resolve such legal
Technically, most blockchain projects in supply chains are issues by providing much needed transparency. Table III
developed on either Ethereum or Hyperledger Fabric. The summarises the key drivers for blockchain adoption in supply
former is an open, generic platform (but has recently started to chains.
offer private blockchain solutions) that is well-known for its
ability to execute smart contracts and allow monetary 5.2 RO2: identify areas where blockchain provides the
transactions. By contrast, the latter is a private modular most value for supply chain management
platform led by Linux Foundation; it is backed by leading 5.2.1 Extended visibility and product traceability
technology service providers, such as IBM, Cisco and SAP, and As evident in Table I blockchains are expected to add the most
it aims to advance cross-industry blockchain developments. A value to supply chains through their extended visibility and
major difference between the two is their consensus product traceability. As such, product traceability will likely be
mechanism. Ethereum relies on mining-based “proof of work” the point at which the blockchain sees large-scale deployment.
to validate transactions, meaning that all participants need to Centralized IT platforms/systems often inefficiently gather and
reach consensus on the order of all transactions that have taken authorise every piece of data along a supply chain. Blockchain-
place. It uses a built-in cryptocurrency (“ether”) to reward enabled transactions (a series of transactions required to get a
miners and pay transaction fees. Hyperledger, in contrast, product from place to place) offer transparency to participating
provides a more fine-grained access control, and only those companies. A block could be created for each transaction
parties participating in a transaction need to reach consensus. following the product’s digital footprint, from manufacturing to
distribution and sale (Patel et al., 2017). This level of
transparency and visibility is essential for improving the
5. Findings and discussion
traceability of products and ensuring product authenticity and
5.1 RO1: identify drivers to blockchain deployment in legitimacy (Casey and Wong, 2017; Lu and Xu, 2017;
supply chains Mansfield, 2017). Real-time tracking is made possible when the
Trust is the most influential factor driving interest in the blockchain is integrated with field sensor agents (Li et al., 2017).
blockchain (26 out of 29 articles, 90 per cent) within supply Moreover, the use of time-stamping enhances information
chain management. Trust refers to the reliability of information completeness. Time-stamping is the process of providing a
provided by trade partners, or the safety and security of the data temporal order among sets of events (Abeyratne and Monfared,
managed by a central authority. Trust is normally discussed as 2016). When an event is recorded in the chain chronologically,
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Table III Drivers of blockchain deployment

Drivers Reference
Trust: reliability and security of information Collomb and Sok (2016), Hull et al. (2017), Michelman (2017), Nakasumi (2017), Patel et al. (2017)
Supply chain disconnections and complexities Li et al. (2017), Nakasumi (2017), Bonino and Vergori (2017), Wang et al. (2017)
Product safety, authenticity and legitimacy Tian (2016, 2017), Toyoda et al. (2017), Mackey and Nayyar (2017)
Public safety and anti-corruption Engelenburg et al. (2017), Kshetri (2017b), Guo and Liang (2016)
Source: Authors

each node (a header in a block) contains a field with a time- 5.2.2 Supply chain digitalisation and disintermediation
stamp recording of the event (Engelenburg et al., 2017). Disintermediation implies that the integrity of data in a
Hence, it can prove the existence of certain data at a point of blockchain is guaranteed by a whole network, not by an
time. With this logic, time-stamping supports the management intermediary (Michelman, 2017). For financial transactions, it
of time-sensitive issues by providing a record of historical means that peer-to-peer (P2P) asset transfers and interfirm
events (Yuan and Wang, 2016; Lee and Pilkington, 2017). trading/payments occur without the authentication of a third
Information completeness is also enhanced by the wide range party (Yuan and Wang, 2016). Michelman (2017) claims that
of data that a blockchain system accommodates. Data in a the blockchain reduces verification and transaction costs by
blockchain can include ownership (chronological list of removing intermediaries. Wang et al. (2017) argue that the P2P
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owners), location data (places the material has been and where network is particularly useful for temporary business
is it now), product specific data (attributes and performance of relationships, as it reduces the cost of building trust. Polim et al.
the products) and environmental impact data (energy (2017) propose a blockchain system that allows retailers to
consumption, CO2 emission, etc.) (Abeyratne and Monfared, directly tender their shipments to third-party logistics (3PLs),
2016). Data could also contain price, quality, date and state of removing fourth-party logistics services (4PLs) from the
the product (Lee and Pilkington, 2017). network.
By design, every transaction along a blockchain supply chain The attributes of the blockchain are ideally suited to large
is fully auditable. The extended traceability afforded by the networks of disparate parties and are seen as a viable solution to
blockchain benefits industries that are sensitive to products and ease the complexity of global supply chains (Abeyratne and
material provenance. Some advocate the use of the blockchain Monfared, 2016; Nakasumi, 2017). International trade is
to trace the origin and production process of food ingredients considered the most complicated supply chain practice as it
(Foerstl et al., 2017; Tian, 2016) and the ownership of luxury involves large numbers of supply chain stakeholders. Most
processes are also paper-based, causing delays, and hindering
textile products (Toyoda et al., 2017). Advocates also propose
the efficient flow of goods. Centralized platforms are the main
the blockchain as a solution to manage counterfeit medicine.
transaction paradigm (Harris et al., 2015), but there are certain
For example, Mackey and Nayyar (2017) ascertained that a
limitations when dealing with a large volume of fast-paced
blockchain will enable the tracking of pharmaceutical raw
transactions (Casey and Wong, 2017). A blockchain-based
materials and finished goods, making it easier to detect fakes by
platform could help digitise paper-based documentation, and
allowing blockchain participants to verify the authenticity of
establish an immutable, shared record of all transactions among
data. Hence, the blockchain might serve as an open standards
network participants in real-time. Table IV offers a comparison
technology to integrate various databases and different actors
of current practices and blockchain-enabled international trade
within the pharmaceutical supply chain.
and supply chains.
In practice, crucial supply chains, such as food, diamond and
Guo and Liang (2016) report that by replacing trade finance
pharmaceutical products, have become the hotspots for (where banks act as financial mediators) with a blockchain
blockchain initiatives (see Cases 1 to 4 in Table II). These platform, the processing time can be reduced from 7 to 10 days
supply chains carry a sense of urgency for reliable traceability to 1 to 4 h. Engelenburg et al. (2017) argue that a blockchain
and product provenance. Knowing the origin and the footprints would provide real-time visibility of shipments directly to
of how products have travelled throughout the supply chain customs authorities, significantly improving the information
delivers not only commercial benefits, such as improving available for risk analysis, safety and security control (Kshetri,
consumer confidence towards the brand (Cases 2 and 3), but 2017b).
also serious safety consequences, such as in the case of aircraft International trade tends to involve a variety of stakeholders
manufacturing (Case 4) or food traceability (Case 1). and supply chain actors. Its complexity often results in the lack
Walmart’s recent trial has demonstrated that blockchain- of information visibility – which can be unethically or illegally
enabled tracking takes only 2.2 s to trace a package of sliced exploited (Abeyratne and Monfared, 2016; Nakasumi, 2017).
mangoes from its US stores back to its source Mexico farms, Collomb and Sok (2016) argue that the blockchain could
while previously, it used to take about seven days using address the third world’s corruption problem in international
conventional tracking methods (McKenzie, 2018). This trade due to its transparency.
blockchain-based tracking allows food retailers and In practice, maritime shipping lines and ports (see Cases 5 to
manufacturers to respond quickly to recalls and other food 7 in Table II) have been actively exploring blockchain-enabled
safety issues, thus reducing the spread of foodborne illnesses. solutions that address the inefficiencies caused by a low level of
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Table IV Paradigm shift of international trade by blockchain technology et al. (2017) argue that the merit of this mechanism is fault-
tolerant because multiple sources of original information are
Blockchain-based
available. Ultimately, increased data security would lead to
Business Current international trade international trade and
increased confidence and trust of transactions between supply
paradigm and supply chain supply chain
chain partners and end-consumers.
System Trusted third-party/central Decentralized/peer-to-peer Security in data sharing is important to supply chain actors as
architecture coordinator based platform transaction basednetwork business transactions often contain highly-sensitive commercial
Database Single copy in data repository Peer verifiedmultiple information. A permissioned blockchain may be of particular
copies value to the supply chain as it offers enhanced privacy,
Security Controlled access/firewalls Cryptography auditability and increased operational efficiency (Gupta, 2017;
Transaction Intermediation Smart contract based Weber et al., 2016). With a blockchain supply chain, actors can
execution onconsensus/proof of encrypt the description of goods and sensitive information and
work use business rules to control access by customs and required
Source: Collomb and Sok (2016) bodies (Engelenburg et al., 2017; Kshetri, 2017b).
Blockchain-enabled data integrity and security also protects
digitisation within complex cross-border activities. For against fraud and cybercrime. Cybercrime leads to data
instance, a simple shipment by Maersk of refrigerated goods breaches, financial crimes, market manipulations, theft of IP
from East Africa to Europe in 2014 was found to have gone and poses public safety and security risks. The vulnerability of
through nearly 30 people and organisations, including more the supply chain and logistics system was clearly illustrated by
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than 200 different interactions and communications among the recent case of the NotPetY, a cyberattack to the world’s
them (IBM, 2017a). In cross-border trade, the costs associated largest container shipping line, Moller-Maersk. The attack
with trade documentation processing and administration could affected all its business units’ operations, resulting in $300m of
be up to one-fifth of the actual physical transportation costs lost revenue (Milne, 2017). Although there might be various
(Maersk Press Release, 2018). factors contributing to this vulnerability, deploying a
In 2016, a blockchain pilot was initiated jointly by IBM and decentralised system could mitigate the threat. A key weakness
Maersk to improve the workflow and visibility of each of a centralised system is that if a system is hacked or there is
shipment. Multiple stakeholders were involved, including some technical malfunction, the whole system may be brought
trading partners, government authorities and logistics to a halt. The blockchain offers an alternative way to manage
companies. Each participant in this blockchain network can data and is more resilient to such hacks.
view the progress of cargo through the supply chain and Blockchain technology offers highly secure and immutable
determine where a container in transit is. Each participant can access to supply chain data. Although this indelibility applies to
also see the status of customs documents or view bills of lading all blockchain use scenarios, it is of particular value to cases
and other data. The detailed visibility of a container’s progress such as those in 12 and 13 in Table II. In Case 12, Google is
through the supply chain is enhanced with the real-time access working with NHS to develop a private blockchain for storing
to original supply chain events and documents. No one party patient data and affording a coordinated approach to the
can modify, delete or even append any record without the management of health records. In Case 13, FedEx piloted a
consensus of others on the network (IBM, 2017a). Following blockchain initiative for data storage after having experienced a
the successful pilot, IBM and Maersk have announced a joint high-level cyber-attack. The blockchain has no single point of
venture to commercialise the initiative (White, 2018). This failure, so it is more resistant to attack. The same information
endeavour signals the dawn of a wider diffusion of blockchain will be available to all participants, so potential conflicts among
technology in supply chains, going beyond the POC and pilot participants regarding a particular transaction are reduced.
stage. Smart contract logic can be written into a blockchain to further
reinforce contractual agreements and mitigate potential
5.2.3 Improved data security for information sharing disputes.
Thirteen articles (45 per cent) within our review stated that
decentralisation is a unique data security mechanism of the 5.2.4 Smart contracts
blockchain. Collomb and Sok (2016) and Tian (2016) point The notion of a smart contract may be the most transformative
out that a centralised database has three potential deficiencies blockchain application for supply chains. A smart contract is a
in that information can be corrupted, falsified and generated computerised transaction protocol that automatically executes
asymmetrically, sometimes causing data to be lost or hard to the terms of a contract upon a blockchain. The general
retrieve. objectives are to satisfy common contractual conditions, while
The data in the blockchain is immutable because the reducing the costs and delays associated with traditional
sequence of transactions is saved in chronological blocks of contracts (Gupta, 2017).
nodes broadcast to all other nodes (Tian, 2016). The stored Smart contacts are considered of utmost value to supply
data are tamper-proof as the updating and deletion of chain automation and self-execution by 52 per cent of the
transactions is prohibited according to the consensus literature (15 articles). A smart contract can be made partially,
mechanism (Patel et al., 2017; Weber et al., 2016). This is an fully self-executing, self-enforcing and can be monitored by the
important advancement as any falsification of the information network (Weber et al., 2016). For example, a smart contract
has to be done in real-time, making it much harder than simply might send a payment to a supplier as soon as a shipment is
substituting new data (Shireesh and Petrovsky, 2016). Patel received by the buyer. A GPS-tracked product return could log
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

its location in real-time and trigger a signal within the Kembro et al., 2014). The technical complexity of the
blockchain for immediate refunds. A smart contract, thus, blockchain makes it a challenge for individual users to
eliminates payment withheld issues and improves efficiency by understand, accept and have confidence in participation. Some
eliminating contract registration, monitoring and updating negative perceptions are associated with blockchains due to the
efforts and time (Collomb and Sok, 2016; Wang et al., 2017). use of Bitcoin for nefarious or criminal purposes (Hoy, 2017;
Bocek et al. (2017) claim that smart contracting reduces the Kshetri, 2017b).
number of intermediaries and requires less manual The blockchain affords pseudonymity, meaning that all
interventions, resulting in reduced operational cost. transactions are transparent, yet are not explicitly connected to
Smart contracts could be deployed by sectors where supply real-world individuals or organisations. However, this
chains are temporary and fragmented with multiple tiers of anonymity could be broken, connecting individual transactions
suppliers and subcontractors. Due to the large number of to parties. This may not be of concern for upstream suppliers.
supply chain stakeholders involved in a construction project, it For instance, for individual farmers in the food sector, this
is difficult to track the progress status of agreed tasks and settle transparency brings marketing and branding benefits.
financial payment accordingly. Smart contracts can automate However, for downstream consumers, their privacy may be
processes like delivering the agreed contracts to specified compromised and sensitive detailed personal information
parties for digital execution, updating programmes based on revealed (Boucher et al., 2017). There are also environmental
agreed variations or compensation events and releasing concerns regarding blockchains, as it requires a high level of
copyright documents to relevant parties (Kinnaird and Geipel, energy consumption to maintain the network (Hoy, 2017;
2017; Wang et al., 2017). Kshetri, 2017b).
Smart contracts are mostly being piloted within financial
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5.3.2 Technological challenges

transactions and settlements (see Cases 14 and 15) in practice. Although the blockchain is perceived as a highly secure
In the automotive sector, a German start-up, Slock.it (Case decentralised data infrastructure, hacking is still possible. It can
14), has piloted the digital wallet blockchain initiative, which happen when a group of miners temporarily control over 50 per
automates the payment process when a passenger car is charged cent of the network’s mining hash-rate (the measurement unit
at a charging station. Although the pilot is for passenger cars of processing power of a network of nodes that power a
only, when it is extended to commercial vehicles, frictionless blockchain) (Yuan and Wang, 2016; Zhao et al., 2016) While
machine-to-machine charging will have a significant impact on hacking into a public (permissionless) blockchains requires
logistics operations. In pilot Case 15, a smart contract is used significant financial and computational power, a permissioned
by Barclays to trigger automatic payment at the point where blockchain may be more prone to cyber-attack (Patel et al.,
cargo ownership changes. 2017).
A smart contract feature is not available to all blockchains Latency is another barrier, as time passes for each verified
but is becoming desired functionality due to its flexibility and block of transactions to be added to the ledger (Wang et al.,
power to include business logic under certain conditions. 2017). For Ethereum, one of the most popular blockchains for
However, this is also where disruptions are the most severe. smart contracts, this occurs “approximately every 17 seconds –
Smart contracts imply significant technological (e.g. security), a far cry from the milliseconds to which we are accustomed
legal (enforcement mechanism when disputes arise) and while using non-blockchain databases (Ream et al., 2016)”.
societal (e.g. removal of intermediaries and potential job losses) Effective incentive mechanisms for miners are needed to
implications. The adoption of smart contracts fundamentally improve system performance (Nakasumi, 2017). For fast-
changes both organisational and supply chain structures and paced scenarios, private customised blockchains work best
governance, and hence it may take decades for it to become the (Weber et al., 2016).
norm within supply chain management (Hull et al., 2017; The blockchain protects the system from any type of
Wang et al., 2017). manipulation by interested parties, but at the same time this
may also create problems. When mistakes happen, these cannot
5.3 RO3: investigate the challenges/barriers to its be reversed (Patel et al., 2017). Equal and opposite transactions
further diffusion within the supply chain could set records straight. Finally, interoperability between
Although the literature agrees that the blockchain will disrupt blockchains and integration with existing IT systems need to be
the status quo and transform supply chain practices generally addressed to ensure smooth data transfer (Collomb and Sok,
for the better, this technology clearly presents many challenges. 2016; Korpela et al., 2017; Patel et al., 2017; Wang et al.,
2017).
5.3.1 Organisational and user-related challenges
Current economic winners may resist change out of the fear of 5.3.3 Operational challenges
losing revenue models (Michelman, 2017). For example, banks For a blockchain to work in the supply chain, all related supply
may be reluctant to coordinate blockchain-enabled business chain actors should be on board (Kshetri, 2018). Blockchain-
transactions (Zhao et al., 2016). It is reasonable to assume that enabled global supply chains operate in a complex environment
other intermediaries may have the same fear of being removed that requires various parties to comply with diverse laws,
from supply chains and resist its deployment. regulations and institutions. Implementing a blockchain in
Other supply chain actors may not want the total such an environment is an extremely complex task (Casey and
transparency provided by a blockchain. Unwillingness to share Wong, 2017). The blockchain, while tamper-proofing the
valued information has long been recognised as a barrier to digital attributes of transactions, could not always accurately
effective supply chain performance (Fawcett et al., 2007; mirror the physical movement of materials in the supply chain
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Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

(Shireesh and Petrovsky, 2016). In reality, accidental errors, copies of transactional data generated by supply chains
conflicts of interests, corruptions and malicious attacks could (Bowman, 2018). This may address the issue of high
still happen (Boucher et al., 2017; Kshetri, 2018). transaction costs associated with the blockchain and would
Chen et al. (2017) raised questions as to what data should be speed up cash-flow exchanges.
stored in blockchains, how such data will be collected and fed Smart contract-enabled transactions may allow instant
into the system and who should be responsible for data input payment from customers to suppliers. This shortens the cash
and provision. The cost of implementing or participating in a payment cycle but does not solve the issue of the upfront need
blockchain system may also be an issue, due to the technical for funds to keep the production/service running by suppliers or
and specialised expertise required for participation (Patel et al., buyers. To address this issue, blockchain-based financial
2017; Wang et al., 2017). It may be even more challenging for service platforms have been piloted in practice. For example,
small-to-medium-sized supply chain companies to participate, the financial services arm of iPhone manufacturer, Foxconn of
due to their lack of skills and financial constraints. Taiwan, partnered with the Chinese online lender, Dianrong,
Finally, as blockchains place trust and authority in a have launched Chained Finance, which claims to be the first-
decentralised network, it represents a total shift away from the ever blockchain platform for supply chain finance (Case 9 in
traditional ways of organising and managing a supply chain. Table II). The two companies recently completed a successful
The loss of control may be unsettling for many supply chain pilot and proof of concept by securing funding for small and
actors. Therefore, cultural resistance and existing business medium enterprises (SMEs) in China that were otherwise
processes will be major barriers to change (Patel et al., 2017; unable to secure needed capital. During the pilot, Chained
Wang et al., 2017). Finance originated US$6.5m (RMB45m) in loans for these
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SME supply chain operators (Sawers, 2017). In April 2017,

5.4 RO4: develop a future research agenda IBM and the Chinese firm, Sichuan Hejia Co., Ltd.,
There is a clear lack of theory and methodological pluralism in announced the launch of a blockchain-based, supply chain
much of the literature we reviewed. None of the papers under financial services platform for pharmaceutical procurement to
review deployed an explicit theoretical lens. An alarming help improve the efficiency, transparency and operation of
majority of papers were either conceptual or technical in supply chain finance (IBM, 2017b). Again, this platform is
nature. Theory is an indispensable part of the research of beneficial to SME companies which often find it difficult to
technological innovations and adoption in supply chains. There raise funds due to underdeveloped credit systems and a lack of
is an urgent need for systematic inquiry to study blockchains established credit evaluation and risk control. The platform is
from a multi- or inter-disciplinary perspective. Rigorously designed to help establish the authenticity of the transactions
developed conceptual and empirical contributions will improve among supply chain participants, allowing banks to be more
our understanding of this emerging technological phenomenon informed and grant access to funding for SME pharmaceutical
and its impact on supply chains, industries and the wider retailers. The blockchain’s ability to track ownership in a
society. distributed and immutable way could also potentially lead to
Given the embryonic state of blockchain technology, there new crowdfunding and peer-to-peer lending initiatives
are many exciting research opportunities for the future. (Collomb and Sok, 2016). Similar cases (Cases 8 and 10) are
also observed where financial transactions are carried out using
5.4.1 Cryptocurrency and supply chain finance
blockchain technology.
Studies need to explore how digital currency, or
Research in supply chain finance is very limited (Caniato
cryptocurrency, may affect supply chain finance. Supply chain
et al., 2016; Carter et al., 2015). Research that bridges
finance is a generic term for a variety of financing instruments
blockchain and supply chain finance is nearly non-existent. As
that finance various parties within a supply chain and support
such, blockchain diffusion into the supply chain provides fertile
the movement of capital behind a physical supply chain (Pfohl
ground for future research. Examining this emerging
and Gomm, 2009). Given that most established applications of
phenomenon would offer valuable insights about how
blockchains are cryptocurrency, supply chain partners may
blockchain supports financial collaboration across supply chain
start to trade and settle their payments using cryptocurrency. A
echelons, not just bilateral financial settlement. More
particularly promising area where we may see cryptocurrency is
importantly, it will allow us to interrogate the economic value of
as a data marketplace for IoTs. With the increasing number of
the blockchain and see whether it affects the bottom line of the
IoT devices in supply chains, they generate tremendous
business.
volumes of data, and this data could provide business
intelligence about supply chains. Big data is so valuable that it 5.4.2 Disintermediation and reintermediation
has become a new asset class for supply chain management. The elimination of intermediaries in the market system, as
Early efforts in practice use distributed ledger technology (not claimed by blockchain communicators (Tapscott and
necessarily the blockchain) to allow businesses to securely Tapscott, 2016), will address the asymmetrical issues among
store, sell and access data streams generated by IoTs (see economic participants and allow peer-to-peer asset trading.
IOTA.org). Disintermediation often occurs when a novel technology
Another example is OriginTrail (Cases 11 in Table II), a application could take the cost or time out of the supply chain
Slovenian IT company specialising in traceability and quality- or add more value to customers (Shunk et al., 2007). For
control systems, which created the cryptocurrency, Trace supply chains, the blockchain may cause the extinction of
Token. The purpose of this currency is to serve as certain types of intermediaries. However, it is hard to fully
compensation for multiple nodes within a network that keep predict its impact on the structure of markets and supply
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

chains. Some compare the current level of development to the chain may be established via the orchestration of a variety of
internet and World Wide Web in the early 1990s. Just as TCP/ services to fulfil a certain demand or order. Once the order is
IP dramatically lowered the cost of connections, the blockchain fulfilled, the formation of this supply chain may dissolve or
could dramatically reduce the cost of transactions (Iansiti and evolve into a new structure for future demands. This “trust by
Lakhani, 2017). design” has led to the digital trust concept, as proposed by
When the internet was first commercialised, it reshuffled Gartner (Gaehtgens and Allan, 2017).
many industries by removing some traditional intermediaries, It is often said that trust takes years to build, seconds to break and forever to
while leading to a plethora of new types of intermediaries. For repair. Digital trust, on the other hand, takes instants to build, an instant to
example, in the book sector, when electronic marketplaces were break and is continuously adaptive.
introduced, the business of the traditional wholesaler/ Digital trust may help prevent supply chain actors from
distributor was severely disrupted. However, new behaving unethically or opportunistically (Hill et al., 2009;
intermediaries like Amazon and eBay emerged, generating Wang et al., 2014). As every transaction in a blockchain builds
value by providing value-added services to participants on every other transaction, any corruption or unethical
(O’Reilly and Finnegan, 2010). behaviour will be readily visible to all network participants.
Future research should explore whether supply chains will This is valuable to humanitarian supply chains where (inter)
still need banks to settle financial transactions, whether national aid is often perceived as not reaching target
transport service providers will be eventually phased out from beneficiaries (Hyndman and McConville, 2017). The built-in
supply chains and whether the echelons such as distributors/ trust would help brands build consumer-confidence when they
wholesales/service agents will still add value in blockchain- know their products are from legitimate suppliers. As Gupta
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enabled supply chains. Disintermediation will take place if the (2017) pointed out, this self-policing mechanism can mitigate
cost of existing supply chain intermediaries exceeds the value the need to depend on current levels of legal or government
they add. Meanwhile, a new breed of intermediaries may safeguards and sanctions to monitor and control the flow of
emerge, which will seize the missing opportunities in the supply business transactions.
chain and promote greater economic, environmental and social However, as there is no central authority to police or enforce
benefits. Research into these new intermediaries and the effect honesty in a blockchain-enabled supply chain, predicting future
of reintermediation will provide further insight about the honest behaviour is impossible. Will collaborative relationship
change of supply chain structures generated by blockchains. and relational capital become less critical in a blockchain-
enabled supply chain? How will companies build their
5.4.3 Digital trust and supply chain relationship management
reputation within a blockchain network? What happens if
Blockchains are often recognised as the missing trust layer of
unethical behaviours take place? How does distributed
the internet and as such may challenge the conventional ways of
governance work in practice? To what extent will the
understanding and researching “trust” in supply chains. Trust
blockchain reduce or eliminate corruption in the supply chain,
is a key catalyst to building close supply chain relationships and
particularly in developing countries and humanitarian supply
has a positive impact on innovation and supply chain
chains where this problem prevails?
performance (Kwon and Suh, 2005; Panayides and Lun,
2009). Trust also influences the risks associated with 5.4.4 Blockchain, inequality and supply chain sustainability
collaborative projects. High levels of trust enhance joint When blockchain technology matures, some believe it could
decision-making and problem solving which mitigate many address social inequality and poverty (Kshetri, 2017b; Tapscott
execution problems and increase the probability of success and Tapscott, 2017). One scenario mentioned is international
(Fawcett et al., 2012). Research also suggests that remittance. This is the application area where a blockchain app
interdependence fosters trust between supply chain partners is developed for people who work in a developed country so
(Capaldo and Giannoccaro, 2015). Nyaga et al. (2010) posited that they can send money to their relatives who live in a
that supply chain collaborative activities lead to trust and developing country. Traditional money transfers are processed
commitment, which lead to improved satisfaction and through a network of central clearing bodies or correspondent
performance. banks. There is limited visibility to value flow for both senders
The research on trust in buyer–supplier relationships has and recipients. The whole process normally takes days and the
emphasised the need for long-term relationships and mutual transaction charges are high due to the number of
investment between supply chain actors to build trust (Fawcett intermediaries involved. Also, those in receipt of monies
et al., 2012; Handfield and Bechtel, 2002; Kwon and Suh, frequently do not have a bank account. Blockchain initiatives
2004). With ongoing globalisation and the growing complexity that target this problem could reduce the timing of
and volume of global transactions, this approach is becoming international monetary transactions of this nature to less than
more time-consuming, costly and inefficient. With the an hour (Abra.com, 2018).
blockchain, “trusting” supply chain partners may be irrelevant. Similarly, the blockchain has been deployed in the food and
Given that the trust has been “programmed” into a blockchain beverage industry to tackle poverty and ensure fairer and faster
through cryptography, relational investment is not as essential payments to small scale farmers. In the coffee sector, although
as in traditional supply chains. In a blockchain, people, 25 million smallholder farmers produce 80 per cent of the
businesses or things come together spontaneously to interact in world’s coffee (Fairtrade.org, 2018), many fail to earn a reliable
a well-defined context. The “trust” only extends to the living from coffee. Moyee Coffee (Case 16) launched a pilot
requested action at that point in time, and that may change project in Ethiopia with the blockchain pioneers Bext360 and
rapidly as conditions change. A blockchain-enabled supply the FairChain Foundation to give all stakeholders – farmers,
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

roasters and consumers – access to data (including prices) innovations. Insights will help broaden our understanding of
across the entirety of the supply chain. Not only did this bring the wider impact of blockchains on multiple supply chain
radical change to traditional coffee supply chains, its potential actors, including those who are vulnerable, exploited and poor.
social value could be significant: offering opportunities for
5.4.5 The dark side of blockchain
small businesses, addressing power imbalance between small
We adopt the broad term, “dark side” (Tarafdar et al., 2013),
producers and large wholesalers/roasters, allowing a fairer
distribution of value along the supply-chain, and thus playing a to depict potential negative phenomena associated with
significant role in poverty reduction. blockchain use, with the potential to infringe on the well-being
Another blockchain application that delivers social value is of individuals, organisations and societies. Dark side
the Building Blocks pilot project (Case 17) by the World Food phenomena include issues like governance, ethics, law, crime,
Programme (WFP). The project uses an Ethereum-based security, privacy, intellectual piracy, automation-induced
blockchain technology to help refugees of the Syrian Civil War. unemployment and technical vulnerability issues.
In the Azraq refugee camp in Jordan, 10,000 people receive The dark side of blockchain technology is already evident in
food from entitlements recorded on a blockchain-based cryptocurrency. Several cyber hacks have targeted popular
computing platform. Refugees purchase food from local cryptocurrencies. The criminal use of cryptocurrency is equally
supermarkets in the camp by using an eye scan instead of cash, alarming when the automatic and autonomous properties of a
vouchers or e-cards (WFP.org, 2017). This pilot has offered blockchain are exploited: money laundering, illicit
valuable insights for future humanitarian supply chains and marketplaces and ransomware. Increasing cybercrimes lead to
may enhance humanitarian agility and responsiveness – a key data breaches, financial crimes, market manipulation, IP theft
success factor in volatile situations (Oloruntoba and Gray, and public safety and security risks. This makes cybersecurity a
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2006). top priority for blockchain-enabled supply chains. The biggest

The sustainability of blockchain deployment in the long- challenge is that, unlike the internet, blockchains have no
term remains uncertain. Its predecessor M-PEASA resembles sophisticated governance system in place.
many of the desired social attributes pursued by blockchain Technical vulnerability seems a far reaching issue for supply
initiatives. The M-PEASA system was launched by Vodafone’s chain researchers, since we may not be able to propose
Safaricom mobile operator in 2007 in Kenya to allow those technical countermeasures. However, understanding how
without a bank account to transfer funds quickly and easily. As these vulnerabilities are open to misuse and their subsequent
of 2017, there were 30 million users in ten developing countries impact on supply chain management is of paramount
and services included international transfers, loans and health importance. For instance, Juels et al. (2016) pointed out a
provisions. M-PEASA was lauded for its social value impact, number of ways in which things could go wrong in smart
since 2 per cent of Kenyan households were lifted out of contracts. To build a secure blockchain supply chain,
extreme poverty through access to mobile money services technology solutions are only part of the integrative measures,
(Monks, 2017). As it took M-PEASA ten years to reach to a as appropriate (inter)organisational policies and procedures,
large-scale deployment in East Africa, we can reasonably laws and industry standards are needed. Supply chain
assume that the same level of impact by blockchain will not researchers could play a part in the latter.
happen overnight. This transition period will provide a fruitful Blockchain development presents significant regulatory
time for theory-driven or theory-developing research to make challenges. The absence of an intermediary in most or all steps
systematic inquiries as to how blockchains may transform the of the supply chain could create uncertainty for the parties
lives of individuals and the relationships among individuals, involved, especially regarding automated forms of execution
organisations and society. and transaction supervision of transactions. Criteria are needed
Supply chain researchers have paid increasing attention to to ensure the legal validity and enforceability of smart contracts
the social dimension of supply chain management and its under the law (Boucher et al., 2017). Privacy is another
sustainability performance (Dillard et al., 2008; Marshall et al., challenge. As data are visible to all who participate in a
2015; Pullman et al., 2009). Often linked with the concept of blockchain (whether public or permissioned), this level of
corporate social responsibility (Eriksson and Svensson, 2015) openness may not be welcomed by all supply chain actors,
(Andersen and Skjoett-Larsen, 2009), the literature particularly end consumers.
emphasises the impact of business through engaging the poor as Through their distributed consensual nature, blockchains
suppliers or customers (Ma¨rquez et al., 2010). Research about also threaten the role of intermediaries. If those intermediaries
the bottom/base of pyramid (BoP) (Karnani, 2007; Khalid could be eliminated, this would reshuffle the whole freight
et al., 2015) suggests that for technology to serve its purpose of sector and create fundamental changes. It may also result in job
developing all stakeholders, including the BoP, the technology losses in the short-term, although new intermediaries offering
should be “participatory” (Berger and Nakata, 2013; Hall et al., blockchain-related digital services might emerge, creating new
2014). Blockchain-enabled social innovations will provide employment opportunities. However, this means job reskilling
interesting avenues for this stream of research. is of critical importance for supply chains.
Future research should seek to explain how value is created, While the dark side use of technology has been actively
captured and distributed in blockchain-enabled social supply discussed in the IT/IS discipline, this issue has not received
chains. Efforts can also examine issues regarding conditions equal attention from supply chain researchers, although IT/IS
that will ensure the survivability and prosperity of such has been recognised as a key enabler to effective supply chain
initiatives. Theories and concepts from various disciplines management. Tarafdar et al. (2013) proposed a guiding
could be integrated to evaluate the effectiveness of these social framework as a basis for research on dark side phenomena.
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

They suggested that research should look at the context of their As discussed in Section 4.2, the sample problem needs to be
occurrence, negative outcomes and mitigation mechanisms. one that is experienced by multiple players in a supply chain
They further proposed that these aspects can be investigated at network. The core value of a blockchain system is in its shared,
different level of analysis: individual, organisational and append-only, distributed ledger across a network of
societal. Taking multiple theoretical lenses to examine these organisations. If the problem is organisational rather than
phenomena would benefit the overall understanding of the interorganisational, the blockchain may not be the right
relationship between blockchains and their potential negative technological solution. Another prerequisite is to consider
outcomes on a range of supply chain actors. whether sharing data securely across a supply chain is needed
while protecting privacy. A private blockchain network would
5.4.6 A design perspective on a blockchain-enabled supply chain support a shared repository and ensure that confidential or
This study has explored the aforementioned strategic issues commercially sensitive information is only broadcasted to
that we think are worthy of further investigation. Future work relevant parties.
should also seek to develop valid knowledge that can directly For the blockchain to provide value to supply chains, assets
inform and support practice. Interest in design thinking and need to be transferred between supply chain players. A major
design science has increased in both the operations difference between a blockchain and a traditional distributed
management (van Aken et al., 2016) and information database is that the blockchain can be used to record
technology/information systems (IT/IS) disciplines (Baskerville transactions of assets between organisations. Assets could be
et al., 2018). In practice, large IT companies, such as SAP and physical products or electronic files/intangible items, such as a
IBM, have been actively using design thinking methods to letter of credit. Supply chain organisations that need to track
articulate problems or opportunities with their clients and how often and through how many parties an asset changes
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multiple stakeholders and to identify solutions that will deliver hands can benefit from the blockchain’s provenance capability.
value to their target beneficiaries. The blockchain can also be deployed when greater trust and
While the design of blockchain-enabled supply chains is transparency are needed in a supply chain network, for
highly context dependent and no one optimal design exists for example, to comply with legal regulations, reduce risks or avoid
all supply chains, researchers could aim to deploy a design fraud.
science approach that focuses on developing generic actions, 5.4.6.2 Building a blockchain ecosystem. Once a business case
processes and systems to address field problems or to exploit is identified, the next question to consider is who should
promising opportunities afforded by the emerging technology participate in the blockchain-enabled supply chain. At the pilot
of blockchain. The generic design can then be operationalised stage, a small group of consortia with three to five participants
in various contexts. has been suggested as a viable number needed to understand
From our review of practices, current efforts have been rather the core concerns and test assumptions across the solution
exploitative instead of explorative and consist largely of a space (IBM, 2016). This founding network can then expand to
collection of incremental advances. Over time and as both include more actors at a later stage. This consortium would
societies and industries grow in their use of blockchain usually include a lead organisation as a supply chain
networks, we anticipate structural changes to business models orchestrator (for instance, in Case 1, it is Walmart, and for Case
across industries, which may then lead to significant socio- 5, it is Maersk) that will play a significant role in shaping the
direction of blockchain development and deployment and in
technological and economic changes worldwide. One way of
coordinating the tasks of participating organisations to ensure
generalising knowledge from emerging practices is to examine a
that objectives are aligned and collective actions are agreed
number of case-specific designs of the intended domain and
upon. Depending on the specific case involved, other
derive generic and transferable essentials (mechanisms) which
participating organisations could include a technology service
produce desirable outcomes (van Aken et al., 2016). We offer a
provider, a supplier and public authorities, such as customs,
few preliminary observations from our understanding of the
banks or logistics service providers. The common incentives
literature to inspire further research, and these are as follows:
that encourage participation in a pilot could be both tangible
5.4.6.1 Selecting a blockchain’s entry point to the supply chain.
(e.g. cost and time reduction, new revenue or risk reduction)
The starting point in designing a blockchain-enabled supply and intangible benefits (e.g. industry leadership, standards
chain would be to identify areas where there are pertinent development or first-mover advantages).
problems in an existing supply chain that blockchain 5.4.6.3 Articulating the platform value. A blockchain-enabled
technology would help address. This aspect is where a design supply chain can be viewed as a value platform, a concept
thinking exercise could be introduced to elucidate and proposed by Perks et al. (2017), upon which network members
articulate areas where the blockchain may bring ultimate value co-create value through a set of specific practices via the
to the supply chain. Typically, a problem or several problematic dynamic configuration of tangible and intangible resources. At
areas can be identified via brainstorming sessions with multiple the strategic level, its key ingredients include value proposition,
stakeholders. Potential ideas/goals, as well as barriers/ value creation and value distribution within the blockchain
problems, will be explored. A clustering exercise could be network.
conducted to group-related issues into themes which can then The value proposition dictates the network revenue/cost
be prioritised based on factors, such as value for organisations, model and its core activities/processes. The consortium needs
time and ease of implementation. Once a use case is finalised, a to decide, for instance, whether a membership fee should be
POC can then be established and tested to determine how charged, how participants should pay and how transactions will
effective the performance is. be charged. Considerations should also be sought about
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

whether smart contracts should be coded into the blockchain platform) and security of the system, will also help encourage
and whether a digital token should be used to facilitate further network adoption.
transactions. The perception of a fair value distribution by all
participating members is critically important to maintain and 6. Conclusion
nurture the resilience of the blockchain value platform.
5.4.6.4 Establishing the governance model. Blockchain- This study explored how blockchain technology can potentially
influence future supply chain practices and policies. Basing on
enabled supply chain governance can be particularly
a systematic review of both the academic and practitioner
challenging because of its decentralised nature – each
supply chain literature, we identified the main drivers of
participant will have a stake in how the blockchain supply chain
blockchain deployment within supply chains, as well as within
is configured and operated. A set of rules on how the
areas in which this emerging technology may provide the most
participating members interact with one another needs to be
value for supply chain management. We have engaged with
determined. In terms of participants, one needs to clearly
certain blockchain initiatives evident in contemporary practice
define:
to demonstrate not only some of the technology’s latest
 the ways by which the participants access or exit a
applications but also a range of technological, organisational
blockchain network;
 the types of roles each member will play; and and operational challenges that are likely to affect its further
 the ways to resolve potential disputes among members. diffusion.
The supply chain literature is particularly interested in
In terms of data, considerations should be given to concerns, blockchain technology as a way of allowing organisations and
such as the kinds of data that should be appended in the individuals to make and verify transactions without needing a
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blockchain and the people responsible for inputting the needed controlling central authority. This feature is of great interest
data. Once the data are in the blockchain, who has ownership of because it may facilitate digitalisation and disintermediation in
them and how IP ownership should be dealt with need to be set, the supply chain, as well as resolve issues associated with inter-
as well. organisational trust. However, the use of blockchain
In terms of transactions, those in charge of validating them technology as a means of implementing distributed ledgers and
and the number of nodes needed should be established. In the smart contracts raises as many issues as it resolves. From our
case of a smart contract, clear roles and responsibilities on analysis of the literature, we have raised a number of issues
which party should review and approve it and how the code associated with the potential socio-economic impact of
captures the right business logic should be laid out. As smart blockchains and proposed a range of future research avenues
contracts have significant legal consequences, they further worth investigating.
complicate the governance of the blockchain network. To our knowledge, this study is the first to examine the
The governance of a supply chain network has been well current state of blockchain diffusion within supply chains. Our
examined in the literature, and a number of frameworks have work is timely in that it provides a solid foundation for
been proposed (Milward et al., 2014; Provan et al., 2007). evaluating a technology whose benefits are not yet entirely
However, as discussed above, a blockchain-enabled supply clear, whose negative effects are unforeseeable and whose
chain makes determining the nuances of governance diffusion path remains uncertain. Our contribution has been to
mechanisms more complicated. identify and organise the otherwise disjointed studies published
5.4.6.5 Exploring legal implications. A number of unique on blockchains in such a way that their relevance to the supply
legal matters emerge from a blockchain’s distributed nature, as chain management discipline becomes apparent. Academic
blockchains are decentralised and, in many cases, global. They scholars will hopefully gain some leverage from this analysis, as
cannot be shut down by any one legal system, and they exist it provides an understanding of the trends in the emerging
outside the boundaries of conventional laws defined by landscape of blockchain technology. Scholars new to it will find
jurisdiction. Local and international laws, industry-specific in this study both a comprehensive review of blockchain
regulations, data sharing regulations, intellectual property, fundamentals and a systematic analysis of blockchain research
liability and general commercial agreements, such as the service relevant to supply chain management.
level and performance assurances, should all be carefully From a managerial standpoint, the findings of this study can
examined (IBM, 2018). Organisations should work with law assist practitioners in making a strategic sense of the disruptive
professionals to define rules and a detailed set of contingencies effect and potential opportunities afforded by blockchain
for anticipating potential legal issues. technology to supply chains. This study not only pinpoints
5.4.6.6 Scaling up a blockchain-enabled supply chain network. areas where blockchain technology may disrupt existing supply
The IT/IS discipline has long explored the factors that chain provisions but also highlights certain challenges and
influence the diffusion of interorganisational technological barriers to the technology’s deployment. As such, our study
innovations (Robey et al., 2008). How these factors can be should help guide managers’ decisions about formulating and
applied to the emergence of blockchain technology has yet to be implementing blockchain-enabled supply chain initiatives.
examined. In practice, the pioneers of blockchain technology From a design perspective, this study offers both practitioners
(as shown in Table II) have asserted that if the future vision of a and scholars valuable insights into identifying a use case that
blockchain network emphasises the sharing of value among all addresses a supply chain problem, operationalising the desired
participants, it will likely attract more participants. Other blockchain supply chain model and focussing on legal and
factors, such as interoperability with core enterprise IT governance issues for long-term sustainability. Our findings
systems, ease of use (e.g. multiple ways of accessing the serve to alert managers, particularly the network orchestrator,
 Understanding blockchain technology Supply Chain Management: An International Journal
Yingli Wang, Jeong Hugh Han and Paul Beynon-Davies

of the need to nurture network relationships among Boucher, P. Nascimento, S. and Kritikos, M. (2017), “How
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