Blockchain will fundamentally change business by enabling shared, replicated, and permissioned ledgers across business networks. This allows participants to streamline processes, reduce risks through transparency, and create new forms of value. IBM's blockchain strategy involves collaborating to build industry solutions on their blockchain platform and ecosystem. Their TradeLens solution digitizes the global supply chain by connecting participants on a blockchain network for real-time information sharing, collaboration, and innovation.

1. How Blockchain will fundamentally change the way
we do business
Arnaud J Le Hors
Senior Technical Staff Member, Web & Blockchain Open Technologies
Member of the Hyperledger Technical Steering Committee
Blockchain Explained Series
Blockchain Explained
IBM Blockchain Platform Explained
Solutions Explained
Garage Explained
Next Steps
Blockchain Explained
V5.10, 8 June 2018

2. What is Blockchain?
Why is it relevant for
our business?
How can IBM help us
apply blockchain?

3. 3
Business networks, wealth and markets
• Business Networks benefit from connectivity
– Participants are customers, suppliers,
banks, partners
– Cross geography and regulatory boundary
• Wealth is generated by the flow of goods and
services across business network in transactions
and contracts
• Markets are central to this process:
– Public (fruit market, car auction), or
– Private (supply chain financing, bonds)

4. 4
Ledgers are key
Ledgers are THE system of record for a business.
Businesses will have multiple ledgers for the multiple
business networks in which they participate.
• Transaction: an asset transfer onto or off the ledger
– John gives a car to Anthony (simple)
• Contract: the conditions for a transaction to occur
– If Anthony pays John money, then car passes
from John to Anthony (simple)
– If car won't start, funds do not pass to John (as
decided by third party arbitrator) (more
complex)

5. 5
Introducing Blockchain for Business…
Blockchain
for
Business
Shared,
replicated,
permissioned
ledger

6. 6
Problem…
… inefficient, expensive, vulnerable
Insurer
records
Auditor
records
Regulator
records
Participant
A’s records
Bank
records
Participant
B’s records

7. 7
… with consensus, provenance, immutability and finality
Auditor
records
Regulator
records
Bank
records
Participant
B’s records
Blockchain
Insurer
records
Participant
A’s records
A shared, replicated, permissioned ledger …

8. 8
Different types of blockchain
– The first blockchain application
– Defines a shadow-currency and its ledger
– Resource intensive
is an example of an
unpermissioned, public blockchain
• All blockchains aim to provide irrefutable proof that
a set of transactions occurred between participants
• Different types of blockchain exist:
• Blockchains for business are generally permissioned and private, and prioritize
– Identity over anonymity | Selective endorsement over proof of work | Assets over cryptocurrency

9. What is Blockchain?
Why is it relevant for
our business?
How can IBM help us
apply blockchain?

10. 10
Blockchain is creating extraordinary opportunities for
businesses to come together in new ways
Optimize Ecosystems
Streamline business processes
and the exchange of value along
your ecosystem
Reduce Risk
Replace uncertainty
with transparency and a trusted
decentralized ledger
Create New Value
Exploit new business
models and eliminate
inefficiencies

11. 11
Financial Public Sector Retail Insurance Manufacturing
• Trade Finance
• Cross currency
payments
• Mortgages
• Asset
Registration
• Citizen Identity
• Medical records
• Medicine supply
chain
• Supply chain
• Loyalty
programs
• Information
sharing (supplier
– retailer)
• Claims
processing
• Risk provenance
• Asset usage
history
• Claims file
• Supply chain
• Product parts
• Maintenance
tracking
Examples by (selected) industry

12. 12
Key players for blockchain adoption
Regulator Industry Group Market Maker
• An organization who enforces
the rules of play
• Regulators are keen to support
Blockchain based innovations
• Concern is systemic risk – new
technology, distributed data,
security
• Often funded by members of a
business network
• Provide technical advice on
industry trends
• Encourages best practice by
making recommendations to
members
• In financial markets, takes buy-
side and sell-side to provide
liquidity
• More generally, the organization
who innovates
- Creates a new good or service,
and business process (likely)
- Creates a new business process
for an existing good or service

13. What is Blockchain?
Why is it relevant for
our business?
How can IBM help us
apply blockchain?

14. 14
IBM Blockchain Strategy
Drive the development of applications for specific business use-cases, to be deployed
to active blockchain networks
Solutions
Services
Ecosystem
Platform
Collaborate
with services
teams from
ideation all the
way to
production
Tap into our diverse ecosystem to develop strategic
partnerships and create your competitive advantage
Solve critical industry challenges by building and
joining new business networks and applications
Develop, govern and operate enterprise
blockchain networks with speed and security
A founding, premier member of Hyperledger, IBM is
committed to open source, standards & governance

15. 15
Making blockchain real for business…
Trade Finance Pre and Post Trade Complex Risk Coverage
Identity/ Know your customer (KYC) Unlisted Securities/ Private Equity Funds Incentive Program
Medicated Health Data Exchange Government Distributed Energy/ Carbon Credit
Supply Chain Food Trust Provenance/ Traceability
Blockchain Solutions

16. 16
⦿ TradeLens is built for the industry and offers benefits to
trade participants from across the supply chain
ecosystem
⦿ Responding to industry feedback, IBM and Maersk
have revised the approach and are proceeding under a
Collaboration Agreement, which offers greater flexibility
and responsiveness to industry feedback
⦿ An Industry Advisory Board will help to shape the
platform and drive standards
⦿ Maersk Line and Hamburg-Sud are participants under
the same terms as other network members
⦿ Core platform components are available today under
an Early Adopter program; full release remains on
target for Q4 2018
IBM AND MAERSK HAVE LAUNCHED TRADELENS
An open and neutral supply chain platform
poised to transform the industry

17. 17
GLOBAL TRADE IS HUGELY INEFFICIENT AND
BURDENED BY PAPER-BASED PROCESSES
Pilot shipments from Central
Europe the US resulted in
containers being delayed for 4
weeks due to lack of
transparency and delayed
information exchange
⦿ Missing customs documents
prevented gate-in at time of arrival
⦿ Pre-announcement to Terminal was
not updated in time. Containers
arrived on different mode, causing
complications for receipt
⦿ Late filing due to ongoing
miscommunication between exporter
and Customs over documentary
requirements.
⦿ Containers missed the vessel due to
late gate-in and due to visibility issues
and communications delays, the
containers were rolled
⦿ Limited visibility over transport plan
issues meant inland providers were
unable to carry cargo on the expected
date
A single shipment of avocados
from Mombasa to Rotterdam
involves 30 actors, 100+
people, and 200 information
exchanges
⦿ Inconsistent information across
organizational boundaries and blind
spots throughout the supply chain
hinder the efficient flow of goods
⦿ Complex, cumbersome, and costly
peer-to-peer messaging
⦿ Manual, time-consuming, paper-
based processes
⦿ Risk assessments often lack
sufficient information; clearance
processes subject to fraud
⦿ To track a ship or container for
the BCO, the Customer
Support Agent from the Freight
Forwarder may have to call the:
⦿ Port
⦿ Carrier
⦿ Trucking operator
⦿ Rail operator
⦿ This occurs throughout the
supply chain
A customer support agent for a
freight forwarder may have to
make up to five calls to
different parties to answer a
simple location question
Data are siloed
Business processes are
manual and intensive
Supply chain partners
spend too much time
chasing information
KEY TAKEAWAYS

18. Connects the ecosystem
Brings together all parties in the supply chain - including traders, freight
forwarders, inland transportation, ports and terminals, ocean carriers,
customs and other government authorities, and others - onto a Blockchain-
based platform with a secure permission and identity framework
Drives true information sharing
Provides for the seamless, secure sharing of real-time, actionable supply
chain information across all parties to a trade - encompassing shipping
milestones, cargo details, trade documents, the structured data embedded in
trade documents, customs filings, sensor readings, and more
Fosters collaboration and trust
Enables the digitization and automation of the cross-organization business
processes integral to global trade, including import and export clearance,
with Blockchain ensuring secure, auditable, and non-repudiable transactions
Spurs innovation
Lays the foundation for ongoing improvement and innovation through an
open, non-proprietary API, the use of standards and promotion of
interoperability, and the launch of an Applications Marketplace that parties
can use to build and deploy TradeLens-powered applications for themselves,
their partners, and their customers
THE TRADELENS PLATFORM
Digitizing the global supply chain
Inland Transportation
Shippers / Beneficial
Cargo Owner
Supply Chain
Visibility Systems
Trade
Association
s
Supply Chain /
Transportation
Management
Systems
Authorities
Financial /
Insurance Services
Port Community
Systems; Terminal
Operating Systems
Ports and
Terminals
Freight
Forwarders /
3PLs
Customs
Systems
Ocean Carriers
Customs
Brokers
18
THE PLATFORM WILL BE BUILT ON AN OPEN
TECHNOLOGY STACK AND IS UNDERPINNED
BY BLOCKCHAIN TECHNOLOGY

19. THE TRADELENS ECOSYSTEM
Primary consumers and
beneficiaries of the platform
⦿ Shippers (BCOs, retailers, manufacturers, etc.)
⦿ Freight forwarders, customs brokers, 3PL
⦿ Network Members
⦿ Financial institutions
TRADELENS
PLATFORM
Clients
Applications
Marketplace
Network
Members
Provide and gain access to end-to-
end supply chain information
⦿ Ocean carriers
⦿ Ports and terminals
⦿ Government authorities
⦿ Inland transportation
⦿ 3rd party data providers
Offer value added services to the
ecosystem through a platform marketplace
⦿ TradeLens offerings
⦿ Offerings from third party ISVs
⦿ Offerings from Network Members and
Clients
19

20. 20
PORTS / TERMINAL OPERATORS
OCEAN CARRIERS
GOVERNMENT
AUTHORITIES
INLAND
TRANSPORTATION
FREIGHT
FORWARDERS / 3PL
SHIPPERS / BENEFICIAL
CARGO OWNER
FINANCIAL SERVICES
Benefit from pre-built connections to shipping lines and other actors, end-to-end
visibility across shipping corridors, and real-time access to more information to
enrich port collaboration and improve terminal planning
Provide information about the disposition of shipments
within the boundaries of the port / terminal
Benefit from reduced customer service and network integration cost, less revenue
leakage, and less mis-declared cargo due to a digital audit trail of end-to-end
shipment events and source documents
Provide information about the disposition of shipments
across the ocean leg
Benefit from more informed risk assessments, better information sharing, less
manual paperwork, and easier connections to national single window platforms
Provide information about the export and import
clearance status for shipments into and out of the country
Benefit from improved planning and utilization of assets (e.g., less queuing)
given real-time access to end-to-end supply chain events for shipments
Provide information on the disposition of shipments
carried on trucks, rail, barges, etc.
Benefit from a streamlined and improved supply chain allowing for greater
predictability, early notification of issues, full transparency to validate fees and
surcharges, and less safety stock inventory
Engage with the platform as a consumer of shipping
information and user of paperless trade
Benefit from pre-built connections to the ecosystem, improved tools for customs
clearance brokerage function, and real-time access to the end–to-end supply chain
data to improve effectiveness of track-and-trace tools
Provide the transportation plan, inland transportation
events, information on intermodal handoffs, and
document filings
Benefit from access to a definitive, real-time, and immutable source of information
for trade finance and trade ins
Engage with the platform as a consumer of supply
chain information

21. Thank you
Arnaud J Le Hors
lehors@us.ibm.com
@lehors
www.ibm.com/blockchain
developer.ibm.com/blockchain
www.hyperledger.org
© Copyright IBM Corporation 2018.

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