The capability to apply advanced analytics, offers blockchain an opportunity to offer supply chain managers a digital weapon to arrest and prevent financial supply chain crime. A recent Deloitte poll identifies that during the past five years, an average of 31% of respondents identified supply chain financial crime, particularly fraud, during the past year. Of these positive respondents, only 15% are presently using or piloting Blockchain solutions to mitigate the problem.
“Financial crimes in supply chains are more complex than ever, but some leading edge organizations are leveraging emerging technologies to help combat it,” said Larry Kivett, a Deloitte Risk and Financial Advisory partner in the forensic practice, Deloitte Financial Advisory Services LLP.
Enhanced transactional transparency and visibility along the chain of custody is driving corporate strategies to both detect fraud and also to clean up waste and other abuses with significant potential to add to the financial bottom line. The implementation of Blockchain is taking place with third-party relationship management and transaction execution solutions. .
The mining industry reports higher than average rates of supply chain abuse along with energy and industrial. They are also among those with below average use and trial of Blockchain. Data encryption and information security lead as the most significant anti-fraud tools of Blockchain that could apply to offer the path to correction.
“We’re seeing a growing awareness among executives that blockchain could be worth exploring as it can offer a new way to mitigate the possibility of supply chain fraud, waste and abuse,” Mike Prokop, a Deloitte Risk and Financial Advisory managing director in regulatory and operational risk management, Deloitte & Touche LLP.
“While the technology’s application for financial crime management in supply chains is nascent, early adopters could glean interesting competitive advantage by leveraging blockchain’s inherent anti-fraud functionality.”
Including data encryption and information security, creating an immutable register was the second most identified value. Blockchain brings trust to peer to peer networks and has gained its recent popularity due to its role as the underlying technology of Bitcoin.
Reference: Material Handling & Logistics , https://www.mhlnews.com/global-supply-chain