New trends and developments are perpetually hitting the business world in recent years. In the digital age, businesses are looking for new technologies essential to their survival. Digital transformation for businesses allows them to take strategic decisions, streamline business processes, and implement new business models by leveraging disruptive technologies in the marketplace.
Blockchain is one of the key technologies driving business transformation. Blockchain may have gained huge momentum in the marketplace in relation to cryptocurrency or bitcoin, but people are still confused about the terminology. They still see blockchain as a synonym for bitcoin and often use the terms interchangeably.
A result of this is that whenever they think about what blockchain for business means, they think about the extent of cryptocurrencies. However, blockchain for business is built on a distributed ledger technology that is permissioned to increase among trusted partners. It is based on a peer-to-peer topology that escalates transactions’ transparency, data resiliency, and security while reducing additional costs in running business operations.
As a result, there is no excuse for losing out on the immense business opportunities that this technology can offer you, simply because you are living under a rock. Today, we will be discussing the different ways in which blockchain can make a huge difference in your business processes in this article.
But first, let’s take a look into the challenges faced by traditional business models.
Also Read: What is Blockchain Beyond Cryptocurrencies: 22 Use Cases
Challenges Traditional Business Model is Facing
Traditional business models have limited resources and are no longer sufficient to tackle global competition. Growing and existing businesses come across various challenges that demand different solutions. Here are some challenges traditional business models face in the current growing competitive environment.
In the traditional business model, every process functions as “silos”. People belonging to one process are unfamiliar with the information gathered, analyzed, and employed by those belonging to another process. This autonomous nature of the processing of businesses is resulting in lower transparency and trustability among all.
2. Time-Taking Processes
As stated earlier, all the processes act as different entities in a business operation. Because of this, teams often end up searching, gathering, and analyzing the same data to make decisions.
Besides, the teams have to rely upon different third-party intermediaries for the proper functioning of their business processes, which in turn, makes processes time-consuming and cumbersome.
This is again one of the business problems solved by technology.
3. Payment Barriers
Another challenge that has been mitigated with the advent of Blockchain business models is that of payment barriers.
Because of the availability of different currencies across the globe and the involvement of multiple parties into the process, payment transfer often ends up being more complex, time-taking, and costlier.
4. No Security
The traditional business ecosystem – data and stakeholders – are not prepared for the far more intelligent and constantly growing hacking world. This makes information reach only a few steps behind the leak and hack.
5. Higher Cost
In the traditional business models, all the processes are performed manually. Besides, various third parties are involved in every process, which not solely demands an additional amount of money and time, but also charges heavily for their services. This, altogether, results in a stagnant rise in the cost associated with a particular task.
Now that we are acquainted with the issues startups and established companies are facing with the conventional model, let’s see what differences come forth with the involvement of blockchain in business processes.
Ways Blockchain Enhances the Existing Business Model
Blockchain technology provides multiple advantages to businesses and introduces new ways to revamp existing business models while reducing costs, lowering intermediaries’ time consumption, and strengthening a higher level of trust in an ecosystem. Here are the 10 ways businesses can embrace blockchain in their digital transformation journey.
1. Smart Contracts
The foremost application of blockchain for business transformation is smart contracts.
As you can depict from its name, smart contracts are a kind of self-executing contract where all the terms and conditions from both parties are written in the form of codes. These codes are then stored on a decentralized blockchain network, making them immutable.
So, whenever the codes are written are fulfilled, the associated conditions are executed. If in case any of the parties overrules the conditions, the services/products are returned back to the other party.
This way, the use of smart contracts encourages businesses to execute legal actions without involving any regulating attorney, government officials, or other fee-charging middlemen to settle disputes.
2. Ease of Payment
The collaboration of blockchain and digital payments is also one of the obvious applications of decentralized blockchain networks. By removing the involvement of third parties and associated documents like billing statements and invoices, blockchain has also eased the cash flow in the startups and establishments.
Let me explain this with an example.
Suppose, you run a medical organization. By harnessing the power of blockchain, you can claim to a patient’s insurance provider if both are on the same platform. Wondering how? While being on the same blockchain network, the insurance company will be familiar with the number of times a patient visited your medical organization along with access to all the payment details. This will create a transparent environment and enable the company to respond to your claim immediately. At the same time, patients also get comprehensive details about the co-payment even before leaving your office.
Bonus read: Blockchain technology- All set to revamp future of transactions
3. Supply Chain Management
When talking about the role of Blockchain in the Supply Chain, the technology enables SMEs to track their products/services throughout the process – right from manufacturing to transportation, and delivery at the consumer end. It introduces the power of transparency and immutability into the process, making it possible for the companies to combat counterfeiting, delays in product delivery, as well as robust security in the process.
For example, Walmart, the retail giant has integrated the blockchain technology into its food chain supply to add transparency to the decentralized food supply ecosystem. After implementing blockchain, the company can now track the provenance and condition of its pork items imported from China. Also, it can now track for any issues in the batches from a specific location.
4. Better Hiring
The role of blockchain in the recruitment process of the business world is also becoming more evident.
The technology prevents candidates from using photoshop or other such tools to build fake yet impressive documents. This also aids organizations by saving time required for verifying all the documents and hiring the potential candidate. A consequence of this is that companies are putting their best efforts into connecting with reputed blockchain development companies and hunting for different blockchain applications in their business.
5. Effective Marketing Campaigns
When focusing on the blockchain impact on business economy, the technology also improves marketing campaigns.
Blockchain business models empowers marketers to keep a real-time track of client information and customer behavior, which helps them to create effective campaigns and derive higher ROI.
What’s more, the use of blockchain in business enables the team to authenticate the traffic from the real world, which later helps to relish higher outcomes from every single penny invested in the process.
6. Robust Security
Another major role of blockchain in business is to introduce robust security measures in the environment.
The technology comes with the power of decentralization and transparency, which encourages users on the network to store and verify some or all of the information stored in the network. This decentralization is what marks the biggest difference between traditional and Blockchain databases. Also, the blockchain network comes with higher complexity and security considerations, which lower the risk of cyber attacks.
In addition to this, the use of blockchain in business for digital identity facilitates users with the functionality to protect and maintain their identity and see how they can access their information and use it for any purpose.
7. Customer Engagement
Another important role of Blockchain in business is to open new doors for engaging a wider target audience.
The integration of blockchain and customer engagement brings forth various opportunities and advantages. These can be achieved by choosing the best Blockchain-as-a-Service provider. This includes empowering users to take control of their personal information, adding s the power of transparency to the business model, fostering quick transactions, as well as ensuring entrepreneurs and marketers in identifying loyal customers and build trust. For instance, Walimai- a blockchain-powered mobile application is dealing with fake milk products by handling counterfeit products.
8. Improved Speed and High Efficiency
One of the major benefits of Blockchain technology is that it solves time-consuming processes and automates them to maximize efficiency. It also eradicates human-based errors with the help of automation. In some cases, Blockchain can handle a transaction in seconds or less. For instance, Walmart used the Blockchain business development technology to trace the source of sliced mangoes in seconds – a process that had previously taken seven days.
9. Financial Management
Currently, businesses spend a lot of money to manage and improve their current system. That’s why they are looking forward to investing in something that reduces cost or improves their current processes. With the help of blockchain adoption by industry, organizations can reduce a lot of costs associated with third–party vendors. There is no need to pay for any vendor costs as blockchain has no inherited centralized player. In addition, there is less interaction needed when it comes to validating a transaction, further removing the need to spend money or time to do basic stuff. This is why Blockchain is important to the business.
10. Capital Raising
Blockchain adoption by industry provides business owners with an alternative method to raising capital through Initial Token Offerings (ITOs). ITOs are tokens available for exchanges where they can trade freely. These tokens are comparable to equity or a revenue share in a typical company. Interested investors can buy into the offering and receive new blockchain-based tokens from the company. This token may have some utility in using the product or service the company is offering, or it may just represent a stake in the company or project. ITOs have become a viable capital-raising alternative for businesses of all sizes due to their rising popularity.
While these benefits of blockchain for business, blockchain impact on business, and the diverse enterprise blockchain real-world use cases would have made you inclined towards the idea of investing in blockchain development, it is advisable to determine its future first. So, let’s have a quick glance at the future of blockchain.
[Also Read: Blockchain in Education – Top use cases and potential pitfalls that businesses must know]
What’s the Future of Blockchain in the Business World?
When talking about the future of Blockchain technology, it has unparalleled potential to introduce new ideas and concepts into existence, along with integrating the existing ones and make a great sense of everything prevailing in the market. For instance, blockchain is revolutionizing the real estate industry, allowing stakeholders to securely conduct transactions and removing the intermediaries.
The technology, just like Silicon Valley, comes with promises that are confined only to the imagination and efforts of the entrepreneurs and application developers existing/entering this field. That implies that the role of blockchain for small business and large business applications depends utterly on how much we harness its potential in our business economy. Something related to which various predictions has already been made, including –
- The annual global data spending on blockchain solutions will reach $11.7 billion by the end of 2022.
- A report by Gartner forecasts that blockchain technology will generate an annual business value of around USD 3 trillion by the year 2030. This clearly demonstrates that 10%-20% of the global economic infrastructure will be governed by blockchain-based systems by the same year.
- As per Statista, blockchain technology revenues will experience massive growth in coming years and is expected to cross USD 39 billion by 2025.
- By collaborating with the Internet of Things (IoT), blockchain is also expected to emerge as the ‘Blockchain of Things’ and make a market of USD 3,021 Mn by 2024.
- 55% of healthcare apps will be using blockchain for commercial deployment by the year 2025.
- Blockchain is also emerging as the perfect answer to the fight against Coronavirus by offering real-time tracking information, data immutability, and transparency across distributed decentralized ledgers.
- Also, the business and IT services will mark 70% of all blockchain spending in the future.
- There are over 81 million blockchain-enabled wallet users in 2022.
Now that we have talked about the future of blockchain and how blockchain is transforming business, let’s not make you wait any longer and take a quick look at how to implement blockchain in business processes of your startup/established brand.
How to Prepare for a Blockchain-Powered Business World?
When it comes to upgrading your existing business by harnessing the power of blockchain or starting a new startup, it is always recommended to contact the best blockchain app development company. This is so because the technology is still in its novice state and can bring forth various hidden challenges and barriers that could be difficult to tackle without prior experience. Implying, it can be nearly impossible to look into the importance of blockchain technology in the business processes without the support of the experts. So, do not overlook this fact.
Contact a reputed blockchain development firm with expert blockchain app developers for blockchain business development and make the best use of blockchain for your business strategy and growth. They will guide you through how can blockchain be used in business
How can Appinventiv help you with Business Transformation?
Appinventiv, an enterprise software development company, has an impressive track record of assisting businesses globally with top-notch solutions backed by disruptive technologies like blockchain. The company has helped various clients with custom blockchain applications that meet business stakeholders’ present and future demands. The expert team at Appinventiv are early adopters of disruptive technologies and boasts an extensive portfolio of clients from different industry sectors. A few global brands partnered with the company are Adidas, IKEA, Empire Hotels, Asian Bank, Pizza Hut, and more.
The company follows a strategic procedure to help businesses explore the world of secure decentralized applications. For instance, Asian Bank, a well-acknowledged core banking solution, collaborated with Appinventiv for a complete overhaul. The team helped them with its app design, development, and deployment, and now the app has over 250K app downloads with over 50K cryptocurrency transactions.
Similarly, Empire Hotels of the hospitality industry gained more revenue after Appinventiv helped them transform their hotel booking ecosystem by enabling complete transparency so that no party is made to pay unjustified additional costs.
Blockchain offers distributed ledger approach that helps improve the media supply chain and decrease copyright infringements through security, data analysis, and control. The importance of blockchain is increasing as numerous industries like healthcare, logistics, manufacturing, and IT is embracing the technology to predict and solve real-time problems. Blockchain along with other disruptive technologies like AI, Big Data, and Cloud is proving to be a groundbreaking technology revamping various business verticals.
Q: Why you must invest in blockchain development?
A: Blockchain-based solutions offer numerous advantages to a business and can boost an organization’s growth in the competitive era. Here are a few reasons why you should consider blockchain:
- Data redundancy
- Rapid transactions
- Efficient security
- Higher transparency
Q: How much does it cost to develop blockchain applications?
A: The cost of blockchain application development depends on various factors like the app’s complexity, industry compliances, geographical location of the development team, and a number of stakeholders interacting with the application. Below is an average development cost based on industry size:
Large enterprises: USD 4,50,000- USD 15,00,000
Medium enterprises: USD 25,000- USD 2,00,000
Freelancers or small enterprises: USD 2000- USD 25,000
Q: Which industries will blockchain impact the most in the near future?
A: Blockchain technology for business strategy is shaping the picture of several industries and among them, many industries will see it getting mainstream in the coming years. A few of the industries are Energy sector, entertainment, healthcare, etc.