Overcoming Blockchain Implementation Challenges
To fully benefit from blockchain’s enormous potential, enterprises must first overcome two formidable challenges: standardization and interoperability.
Also read: Japan Risks Falling Behind Amid Blockchain Talent Shortage
Blockchain Standardization Challenges
Bitcoin’s blockchain technology is becoming increasingly pervasive. Indeed its potential is touted across the board, from the Nano Internet of Things to the Industrial Internet of Things, providing businesses with vast opportunities to innovate and create new products.
But because blockchain technology is so unprecedented, enterprises all over are confronting problems related to standardization and integration of the blockchain into the enterprise. As a result, initiatives are focusing on how to standardize and integrate blockchains into enterprises.
For example, the World Wide Web Consortium (W3C) convened the first workshop on blockchains (or Distributed Ledgers) on the Web at the Massachusetts Institute of Technology, in June 2016. The purpose of the workshop was to study which features of the blockchain are applicable for standardization. Specifically, the workshop focused on “basic infrastructure for enabling and benefiting from blockchains in a Web-facing context.”
Thanks to the workshop’s success, W3C will continue to coordinate blockchain-related activities through the Blockchain Community Group. The mission of this group is, “to generate message format standards of Blockchain-based on ISO20022 and to generate guidelines for usage of storage including torrent, public blockchain, private blockchain, side chain and CDN.”
Additionally, Standards Australia, a non-government organization, proposed new international standards for blockchains and distributed ledger technologies in April 2016. Standards Australia submitted its proposal to the International Organization for Standardization (ISO).
Integrating & Implementing the Blockchain
To meet integration challenges that the digital era brings, leading research companies, such as Gartner Inc., are focusing their research on integration strategies.
In this regard, the Gartner report “CIO Call to Action: Shake up Your Integration Strategy to Enable Digital Transformation,” highlights that the classic models of integration are no longer valid. They are indeed obsolete. The report explains:
“The fast pace of change that is driven by digitalization, the opportunity to experiment with ways to relate to constituencies via mobile, cloud and analytics, and the chance of testing new business models enabled by the IoT are at odds with the classic systematic approach to integration.”
It also proposes that IoT can bring unimagined levels of efficiency and innovation. “However, it also requires organizations to integrate the new world of ‘smart things’ and the data they produce with back-end business processes, data and analytical environments.”
So, how can we integrate or operationalize blockchain technology?
Big companies that focus on enterprise-wide applications, such as SAP, are examining blockchain technology in search of an answer to this question.
For example, Bernd Leukert, Member of the Executive Board at SAP, Products & Innovation, has indicated that SAP has had blockchain technology on their radar for some time and that it’s already testing several blockchain implementations, such as Ethereum, MultiChain, and the Bitcoin blockchain. However, to Leukert, the question of how to integrate blockchain technology still needs to be answered.
“It remains to be seen if solutions based on this technology will truly act as business disruptors and how well blockchain will integrate into existing systems and processes,” he says.
The good news is that Software AG claims to have the answer on how to integrate or implement blockchain technology.
Software AG argues that financial institutions, for example, will use multiple blockchains for a variety of purposes. Therefore, these institutions will need to have a blockchain access layer to interact with the existing applications and the blockchain.
Consequently, Software AG offers an access layer that allows integrating blockchain technology within the enterprise. The access layer lets applications work with the blockchain seamlessly.
“Acting as a broker, this layer abstracts the complexities of blockchain and smart contracts and exposes blockchain application functionalities and communicates them to legacy applications,” Software AG explains.
Taking the lead in integrating blockchain technology will help enterprises build competitive advantage. Efforts such as those led by W3C and Software AG represent decisive leaps forward that will enable companies to exploit blockchain technology to their fullest potential.
What are your thoughts about standardizing blockchains? Let us know your thoughts in the comments section below!
Images courtesy of Shutterstock, go.sap.com, Software AG.