Breaking through with Blockchain Melanie Nuce 15 March 2018

Why is blockchain exciting? Data Sharing. Most of the excitement about blockchain is really just excitement about the possibility of sharing data across company lines For some entire industries, this is an unfamiliar concept. For industries where data sharing is familiar and interesting, blockchain presents a sexy way to talk about it…and to raise awareness of the need for data sharing across organizational silos.

Relevant parts of a public blockchain Blockchains are shared databases of records that can never be changed afterwards (immutable) They commonly use distributed ledger technology They are decentralized and replicated (not merely distributed) No one organization controls governance of the data or the process of validation Validation of the data is commonly resolved through consensus or “proof of work” They may have stored procedures to enforce validation rules for data and for transactions These are also known as “smart contracts” and are independently verifiable by any participant They can support a cryptocurrency This is the most widely used implementation of a blockchain today This might be useful if database transactions involve payment, but isn’t as relevant for supply chain applications They may offer reward systems Often referred to as “mining”

Centralized vs. Distributed vs. Decentralized One database, one owner Not resilient to organizational failure Not resilient to technical failure One Owner Distributed Many database copies, one owner Resilient to technical failure Not resilient to organizational failure Router Master Slave Slave Decentralized Many database copies, many owners, no one “master” Resilient to technical failure Resilient to organizational failure Owner 1 Owner 2 Owner 3 Owner 4 Node Node Node Node

Enterprise Value of Blockchain A blockchain is just a unique ledger of transactions…that prevents users from changing data or deleting data An enterprise blockchain is generally an index that references off-chain data that will be maintained in traditional data stores Helps keep the size of the ledger reasonable Enables fast sharing of a common truth about events and contracts Data that is familiar to supply chain business applications could be shared in an enterprise blockchain ledger Event data, transactional data, and even master data Pointers to data (or hashes of that data) may also be shared in an enterprise blockchain ledger The ledger is also able to prove through pointers and hashes that the off-chain data wasn’t tampered with

Blockchains and traditional data stores Owner 1 Owner 2 Owner 3 Owner 4 Data Store EPCIS Event Rep. Node Node Node Node Data Store EPCIS Event Rep. Enterprise Blockchain ledger Access and permission control layers Pointers to off-chain data and hashes of off-chain data Some relevant pieces of data needed for validation and business processes and smart contracts Identifiers based on GS1 keys (party, location, things, etc) – likely obfuscated Data stored in accordance with GS1 standard data structures Off-chain resources Access and permission control layers Event, transaction and master data stored in accordance with GS1 standard data structures (such as EPCIS Event Data Repositories) Identifiers based on GS1 keys (party, location, things, etc) Other data resources that may be needed (documents, images, files, etc)

Pilots, Pilots, Pilots Enterprise Blockchain proofs-of concept are quite popular at the moment Many of them are generating insight into a common set of underlying issues Basic business processes in pilot organizations will need to be adapted before distributed ledgers will bring the expected value.

Where does GS1 fit… and where does “blockchain” fit? Business Applications Track & Trace, Anti-counterfeit Order-to-cash processes Electronic commerce Standardized identifiers Transaction data Visibility event data Master Data Oracle, IBM, Microsoft, Teradata, etc. Amazon, Google, Bluemix, etc. EDI Networks, VANs, data pools Blockchain technology Database or other data sharing technology Blockchain is here Blockchain is a shared, secure, distributed ledger; GS1 facilitates standards for data and some business applications

Standards are an important foundation

Standards Make Interoperability Possible Sharing unique identification through a common language of standards creates an ecosystem of platforms, applications, and networks that securely links people, places, and things. By leveraging unique identification to activate an entire ecosystem of platforms, applications, and networks By allowing for data exchange, analytics, and ultimately insights that can make my customers’ lives easier, better By enabling enterprises to move at the speed of the consumer with innovative uses of technology via the Internet of Things (IoT) By operationalizing the vision of connected people, places, and things

Standards Make Transparency and Trust Possible Delivering trusted product data required for visibility and traceability, providing safer environments for patients and consumers alike. By standardizing the identification of products, assets, and locations By facilitating the sharing of that information between trading partners By increasing visibility, and thereby traceability By supporting the 2011 Food Safety Modernization Act By supporting Food and Drug Administration Unique Device Identification (FDA UDI) and Drug Supply Chain Security Act (DSCSA)

Blockchain  Digital Transformation