Counterparties on each side of a business engagement typically operate from a defensive stance instead of participating in a mutually-beneficial and value-driven relationship. The core issues include hardened distrust and siloed information systems.
With blockchain-backed smart contracts, business transactions can now be conducted on a foundation of trust. Blockchain provides an elegant solution to supply trust and deliver a shared picture of reality across smart contract participants. When deployed through a smart contract network, the technology can set and enforce data standards that transcend multiparty systems and various data streams to eliminate bias - finally eliminating inefficiencies, streamlining operations and capturing lost value between counterparties.
But not all blockchains are created equal.
How a blockchain stores data is imperative in determining if it is in fact a true neutral referee for commercial relationships complete with transparent and equal accessibility for all counterparties. Just like the NFL’s top officials are rigorously vetted to enforce rules for the big game, only the best-performing blockchains and smart contract networks can be trusted to mediate today’s complex supply chains.
For example, some blockchains only put a small amount of data physically on-chain with a pointer, be it a link or URL, out to another system that holds the evidence or documentation for the transaction. Keeping the evidence that supports a particular payment off-chain in a single party’s system (like a buyer’s SAP or a seller’s particular delivery management system), can work in the moment, but as soon as one party wants to perform an audit, the process breaks down.
How can either party reassemble all of the data for a comprehensive audit if needed? Can one really trust that a vendor or customer will continue to grant access to their private business systems for months or years after the transaction occurred? With this approach, a large percentage of data becomes unavailable, undercutting the premise of trust. If data is not stored physically on-chain, with each party maintaining access to their own complete copy, the records are useless.
As it pertains to blockchain, the best approach to data storage is on-chain like that of GumboNet, our smart contract network of enterprises and their customers, suppliers and vendors. We’ve created a purpose-built blockchain designed to store all transaction data so counterparties have everything needed should a comprehensive audit be required even months after a transaction.
