'Blockchain tech can enhance supply chain collaboration'

Decentralised information-flow technology can improve visibility of raw materials in the auto industry, says Vaideeswaran Sethuraman, Founder and CEO of Param Network. Mayank Dhingra has the story.

- Mayank Dhingra

Over the past two years, the global automotive industry has been through what could easily be termed as some of the most challenging times in its century-old history, with Covid and the associated supply chain constraints derailing its smooth operations.

With the prolonged semiconductor shortage continuing to impact production forecasts at major automakers around the world, there is no better time for the industry to introspect and relook at the nature of its interconnectedness.

Though it is a highly-intertwined industry, there is a big lacuna in the sense that information flow between companies - for instance, an OEM and a supplier-is not the most transparent, due to the different ERP or enterprise resource planning systems which inhibit organised communication between one another. Procurement personnel at OEMs and suppliers are often seen relying on phone calls and informal messaging services to gather information on raw material availability and part visibility, to further determine production plans at their end.

It is here when blockchain - the decentralised information-flow technology that has recently gained much acclaim in the finance-technology (fin-tech) space, particularly with the rise of cryptocurrencies, holds immense potential to be an enabler of supply chain collaboration in the automotive industry and improve real-time information transfer as well as transparency between companies.