How Blockchain simplifies business processes
How Blockchain simplifies business processes
Many of you reading this post are familiar with the definition of “Business Process Management.” It is the methodology of designing, producing, monitoring, and upgrading business processes. Although the concept of business process may be traditional, it has shifted from slow, manual methods toward more comprehensive automation during the past years.
So far, automation help companies to manage their internal workflows more efficiently, but what if your business needs a peer-to-peer BPM system with partners outside of your company?
With the emergence of blockchain, organizations can take the next big step in reinventing BPM.
Welcome to what blockchain can offer
“Smart Contract” is a concept that connects business process management (BPM) and blockchain technology.
Smart Contracts are simply programs stored on a blockchain and are used to automate the fulfillment of an agreement. Imagine that the smart contract protocol is a middleman that interferes with a transaction between two entities and can replace the role of intermediates in routine agreement processes.
Because smart contacts can digitally verify, control, or execute agreements within the blockchain platform, they are the faster, cheaper, and more secure solution for managing contracts.
To understand how smart contracts can simplify complex business processes, think about transferring ownership via a sale. In this case, we need a trusted mediator between buyer and seller. The mediator should handle the actual transfer of ownership to the buyer and the processes of funds to the seller. Although this is the logical way of making trades, blockchain eliminates the need for go-betweens, removes complexity in business processes, and saves money and resources all over.
So, what are the significant challenges in front of the next level of BMP?
Knowing the excellent opportunities smart contracts can bring, why is Blockchain technology limited in BMP?
Using it alone has no advantage!
Generally speaking, enabling blockchain solely inside the company does not make sense. The best use-cases for blockchain are between parties when there is no trust. Therefore, the lack of blockchain adoption among businesses is a considerable challenge for this disruptive technology. Keep in mind that blockchain is more beneficial whenever the deal can be written in clear computer language.
For the contracts that the quality of delivered services can not be evaluated by system, the traditional business processes and social mechanisms are probably more suited.
Blockchain is still a complex concept!
Blockchain is indeed a trendy subject, but this is not enough for building up a team of experts to deploy it into your business. Based on the recent research, 49% of participants point out lack of skill is on top of the hurdles to broad blockchain adoption.
Fundamental change!
Business processes need to change thoroughly to use blockchain, and in some cases, even governments are involved. You know better that these changes will take a long time to happen.
Considering all possible challenges on the way to blockchain growth, many believe that we can expect more and more use-cases of blockchain in various businesses in the future.
About Author
Faezeh, as a product manager does her best to develop deep empathy towards target customers, to find their underserved needs, and to build the winning products.
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