In a bid to reduce cost and improve the efficiency of its vast global supply network, the world’s largest manufacturer of smartphones and semiconductors are planning to implement the technology behind cryptocurrencies.
According to Song Kwang-woo, the blockchain chief at Samsung SDS Co, and the group’s logistical, information and technology arm, revealed that Samsung Electronics Co is planning to maintain a blockchain ledger system to keep track of global shipments amounting up-to tens of billions of dollars annually. According to SDS, the system would help in reducing shipping costs by almost 20 percent.
While many companies across the entire globe have announced their ambitions to deploy blockchain technology on almost everything right from cross-border payments to keeping a track of the life-cycle of supermarket chickens, Samsung Group has emerged as the first global manufacturers to seriously consider implementing the distributed ledgers for its operations. As per reports, SDS has already begun working on the framework for Samsung Electronics, the conglomerate’s crown gem.
Song Kwang-woo, who is also a vice president at SDS, stated, “It will have a massive influence on the supply chains of manufacturing businesses.”, he also added, “blockchain would provide the necessary fuel to ignite our digital revolution.”
Brought into the spotlight by bitcoin’s breath-taking ascent, blockchain technology has been lauded as an achievement that will completely change the way exchanges are recorded, verified and shared.
While blockchain still hasn’t managed to create a massive impact on the corporate ecosphere yet, according to Gartner Inc, all blockchain-related industries will manage to generate a combined value of nearly $176 billion by 2025.
According to International Business Machines Corp, the company which is jointly working with A.P. Moeller-Maersk A/S for the purpose of tracking cargo movements and automate shipping paperwork.
The company believes that blockchain exponents in the shipping industry would help in reducing the time taken for sending paperwork back and forth and to coordinate with port authorities. Documentation costs for containment shipments are more than twice as big as those for transportation.
SDS expects to handle 1 million 20-foot-equivalent (TEU) shipping units and 488,000 tons of air cargo by the end of this year. Organic light-emitting diode displays and Galaxy S9 phones manufactured by Samsung Electronics would also be included in this shipment.
According to Cheong Tae-su, professor of industrial engineering at Korea University in Seoul, he feels a blockchain system might provide assistance to the company by gradually reducing the time lag between product launches and actual shipments, which in turn will make it easier to respond to rival products and shifting consumer preferences, especially in emerging markets like China.
According to Cheong’s statement, it reads, “It eliminates overhead and abolishes bottlenecks,”, the statement further reads, “It’s about maximizing supply efficiency and visibility, which then renders into more customer confidence.”