The implications of blockchain technology are far reaching, it presents a paradigm shift in both information sharing and the delocalisation of computational resources.
Whilst most of the headlines pertaining to blockchain chart the massive volatility in cryptocurrency values, that’s a little like talking about the early internet just in terms of cat pictures that were shared on it.
True, blockchain needs a token system (the aforementioned cryptocurrencies) to operate, but once the initial market speculation and volatility around these level out, the underlying technology will have the opportunity to shine for what it really is.
At Corcentric, we are most enthusiastic about the implications of blockchain technology. Such as the capability for shared ledgers. This takes the verification of transactions to a new level – enhancing trust and improving security. The persistence of the ‘chain’ in blockchain also enables easy auditing, something we see becoming an increasing requirement in a post-Enron, Sarbanes-Oxley, business world.
Blockchain computation and ‘smart contracts’
Beyond the improvements in visibility that blockchain enables, there is a fascinating computational layer emerging via technologies such as Ethereum. Due to the shared, decentralised nature of blockchain, programs running on it are extremely hard to censor or interfere with. So, deploying a ‘smart contract’ program – perhaps set to make a payment to a specific address if certain conditions are met (e.g. the sale of a house) – creates an assurance of payment when those conditions are met.
“Bitcoin is first and foremost a currency; this is one particular application of a blockchain. However, it is far from the only application. To take a past example of a similar situation, e-mail is one particular use of the internet, and for sure helped popularise it, but there are many others.” – Dr Gavin Wood, Ethereum Co Founder
It’s easy to see how smart contracts, operating on a blockchain, fit well with the concept of electronic invoicing or e-billing in the wider sense. Theoretically, the blockchain could be utilised to validate a transaction, deliver an e-invoice and facilitate payment, entirely automatically.
Sharing documents via the blockchain
As more businesses move towards electronic document distribution for a wide range of benefits, it’s not a large step from here to think of documents as being shareable in both directions – enabling collaboration on content. Typically, collaboration requires the sending of one document back-and-forth, with one person editing it at a time (the others being locked out, to preserve version control).
The implications of blockchain technology for document distribution mean a single document could be worked on collaboratively by a broad range of users – with recorded detail about who made which edits and when. This may sound familiar, as Google Docs offer a similar capability already. However, as blockchain becomes more deeply integrated in business processes, it’s likely that this shared, distributed even, approach to documents will become standard.
Blockchain technology removes the need for a ‘master’ document to be held somewhere. The document can reside in a distributed, decentralized, blockchain network and any edits (changes from the original/master) can be immediately identified and validated – preserving integrity through transparency of changes.
How to leverage blockchain value, without complexity
With any new technology, there is always an adoption curve. Those businesses embracing technology first often invest large sums of money in research, deployment and then revisions… offset against the competitive edge of being first to offer a new way of working.
At Corcentric, we see this a lot with the ever-increasing variety of electronic document formats, especially in the area of e-invoicing. But this is exactly where we help clients most – we take away the need to understand the complexity. Corcentric EIPP acts as an interface layer with a huge number of different EDI, eProcurement and other specialist solutions. Through our set of connectors, we can quickly translate and deliver documents in the correct format for any recipient.
So too will the need arise for our customers to integrate accounts receivable processes, such as e-invoicing, with blockchain technology. At this juncture, it makes perfect sense for businesses to outsource their integration challenges to an expert partner, like Corcentric. This enables businesses to focus on their day-to-day activities, whilst the technology partner takes the strain of keeping up to date with the latest protocol changes and technical requirements.
How fast will the blockchain ‘revolution’ be?
As revolutionary as blockchain technology is, it’s not going to dominate the invoicing or document distribution market anytime soon. Whilst there will be competitive advantage to early adopters being able to offer a blockchain-connected solution, its certain that many of the current electronic channels will remain for some time.
How can we be so certain? Well, it’s already clear that electronic invoicing offers distinct savings (around €6.40 per invoice by some estimates) over paper, and yet this is only growing at 20% year on year. It’s human nature to fear change, and change to such business-critical services as invoice distribution takes the longest time to approve.
Document distribution, in the wider sense, is also likely to shift slowly to a blockchain-centric approach, but there will be no overnight revolution, change will be measured in years.
How to prepare for the implications of blockchain technology
Whilst we wouldn’t recommend investing in a whole new team to identify and implement blockchain solutions just yet, it’s important to prepare for the future. Talk to us today and find out how Corcentric EIPP can enable you to support invoicing and document distribution in a vast range of formats and standards, including implications of blockchain technology when this becomes relevant to your market.