Blockchain has the potential to transform the way enterprises share information and thereby revolutionize their business models. The million-dollar questions surrounding this innovation are: How can you make the best use of this innovation? And which areas of your business can benefit the most from it? What if there were a magic wand that could demonstrate exactly how this new technology can positively impact your revenue and bottom line – and by how much?
We can assess blockchain technology’s business-transformation potential without getting bogged down in the technical intricacies, such as cryptography hashing, consensus algorithm, proof of work, decentralization, etc., by:
- Analyzing the key underlying weak spots in your business model that blockchain may be able to solve, and
- Reimagining your business model by ideating on proven use cases that leverage blockchain, such as product authenticity, digital payments, and supply chain traceability, and whether optimizing those processes can differentiate you from your competitors.
Let’s first discuss A. The Business Model Canvas technique provides a summarized view of an organization’s business model and is a great baseline for ideation. Some questions you can ask to identify use cases where blockchain might help include:
- Does the process involve multiple parties?
- Could we gain additional business value from a trusted multi-party relationship?
- Can we digitize our agreements with partners?
If your answers to these questions are yes, you can start exploring further. Think through your business model, take each key dimension, and ideate! How can you enhance your customer experience? Could additional revenue streams flow from providing additional supply chain information to your consumers and partners? Can you optimize your relationship with partners?
B above would work the other way around to identify relevant use cases; it takes popular blockchain use cases (as shown below); applies them to your business model, and verifies whether they would positively impact your business model:
- Digital payments
- Digital identity, document verification, and records management
Let’s consider product authenticity, in which you can validate any product anytime in your supply chain and enable your partners and consumers to do the same. What if you achieved that using a blockchain-based solution: would that have a positive impact on your business model?
To assess that, ask these questions:
- Can product authenticity information bring additional value to my consumers?
- Would that establish a better brand value?
- Does it enhance the customer experience?
- Does it optimize my business activities or relationship with partners?
- Does it bring new revenue streams?
Then redraw your business model, assuming that blockchain solves the key problems you might have. For example, product authenticity could have a key impact on a retailer’s business model as follows:
The areas marked in red squares are places where product authenticity can make a positive impact on the retail business model.
You can visualize the impact of these use cases on your business model by inviting key stakeholders into a room to apply the Business Model Canvas technique and think through blockchain from the lens of business transformation.
Once you identify some applicable business use cases that have high potential for positively impacting your business model, proceed with the next steps:
- Draw a detailed journey map of the use cases, along with actors, tools, and touchpoints.
- Identify the best blockchain platform, protocol, and integration features and identify whether a similar solution is already available.
- Think about possible partners who would be part of your blockchain or join an existing consortium of partners.
- Build a proof of concept.
- Scale it.
Best wishes in transforming your organization through blockchain!
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