Learning Nugget 32 - Customer Experience - Better Every Single Time
June 14, 2016
Learning Nugget 24 - Risk
April 10, 2016
BOLD Learning Nugget 32 - CX Innovation
June 20, 2016
Learning Nugget 29 - Blockchain - Are you ready for the revolution ?
May 22, 2016
Did you know there are over 200 legitimate digital currencies operating in the world today? You’ve likely heard of the most prominent….Bitcoin. But others that exist include Litecoin, Peercoin, and Namecoin
So what is Blockchain?
If you know about it – awesome, you are in the minority. If you’ve heard about it, it’s likely in the context of Bitcoin. If you haven’t heard of it, strap in and lets explore it.
Quite simply Blockchain has the potential to be the single greatest digital disruption since the invention of the internet.
I literally mean trillion dollar, yes that’s trillion dollar, industries could be rendered defunct unless they rapidly explore the power, benefit and capabilities of Blockchain.
Lets first start with 2 very short videos. These two provide an excellent short summary of what Blockchain actually is.
So what we learn from these videos is that Blockchain is essentially a peer to peer distributed network of record keeping, a hyper ledger of every asset on the planet, from money, to art, legal documents, but can even include digital rights, to as simple as wedding certificates or house ownership certificates.
It is secure by the process of merely updating records, every 10 mins, but never changing the past. Very secure.
So why is it so disruptive? What’s the big deal?
In short it removes the need for any 3rd party broker, notary, processing agent or intermediary in any transaction.
Banks are one of the most well known, but there are more
Insurance companies are another, between the re-insurers and the retail customer
Shopping centres and malls, between the FMCG companies and the customer
Government is another, in between regulation and governance and constituents
Conveyancers, the middlemen in property buy/sell transactions
Music distribution platforms, sit between the artist and listener
Ebay and all other auction sites
The list goes on
All of these intermediaries “clip the ticket” on the way through. While most only to the tune of a couple of percentage points on each transaction the sheer volume of transactions means the annual income generated is in the trillions of dollars.
Why will it be so disruptive ? The marketplace is already transitioning this way. The sharing economy is the first step on this journey. Think about what Airbnb and Uber have done to intermediaries such as taxi companies and hotels. They simply removed them from the equation. BUT…Uber and AirBnB are themselves intermediaries. They simply act as facilitators. What if someone came along and build a free app, that allowed anyone to hail a ride, pay for that ride and get the ride, all on Blockchain. No intermediary required. I’ve said for over a year now, Uber could be out of business in 10 years. It’s entire lifespan might be less than 15 years in existence.
So what are some examples of where Blockchain is being used today, outside Cryptocurrencies. Note I’m ignoring financial services sector here. You can google to your hearts content on that. Tons of articles, white papers, blogs and videos talking about how Blockchain will transform financial services. I’d like to explore some of the lesser known opportunities and examples to help you think more deeply and broadly about why developing some knowledge in this area is so critical.
If you consider Blockchain’s core value as a digital hyper ledger, Governments by their nature somewhat play the paper ledger role already. They have department after department that is tasked with keeping records of who owns what, what’s changed hands, the current value of something etc. The obvious ones are land and property, births, deaths and marriages, patent records, cars, boats, trucks, business names and ownership, public assets, but you can even go into pets, criminal records, tax history and even ID’s such as passport records. All of these have some form of “value”. Some are not published today, most are. Most are used in a variety of transactions, in fact many transactions. A simple example is when a house is bought / sold. The “record” needs to be updated that the seller is no longer the owner, the new buyer is. The process to achieve that requires real estate agents, solicitors, conveyancers, banks and various levels of government today to complete that transaction. Imagine of it could be all done digitally directly between the buyer and seller without anyone else being involved, but everyone who needs to know, now knows, as it’s all accessible through the hyper ledger.
Govt budgets, probably the most scrutinised of any budget in the world, imagine being able to precisely and effectively manage that budget using Blockchain ? This is a really powerful article it opens up a number of different concepts of how Blockchain can be used in the public sector. What I really like is the thinking around trust. Blockchain by it’s nature forces transparency. This is a major issue for many elected forms of govt. 3 min read http://www.libdemvoice.org/49941-49941.html
Share trading. Australian Securities Exchange chief executive Elmer Funke Kupper said "that using blockchain could take $5 billion out of the cost of buying shares. He said that as the technology matured in the next five years Sydney could stand alongside New York and London as a blockchain capital of the world. What it allows you to do is to collapse whole business value chains. When you think about the equity market today, it's a very sequential process. It's a complex sequential process for what is a very simple transaction. These processes are 20-plus years old. We realise if we can bring everyone along on this journey of blockchain that $4 billion to $5 billion could become a smaller number. But we could unleash innovation, competition and better services across the value chain."
Healthcare. Healthcare organizations can track communication data for the federal Health Insurance Portability and Accountability act (HIPAA). In short tracking intellectual activities as well as real activities. Thinks like current certification of practitioners against the types of medical care they are delivering to the amount of patient falls per hospital and the safety regime of said hospital (i.e. Comparing assets to injury)
Voting. Sure eVoting has been around for a while. The act of placing a vote isn’t the issue, it’s the act of identifying and authenticating the voter before they place their vote that is the issue. But don’t just limit your thinking to political voting. An increasing number of organizations and political parties have proposed the creation of a blockchain-based system to build a fairer and more transparent voting environment. in 2014 the Danish political party, Liberal Alliance, proposed using the technology for e-voting. “The blockchain removes the need for trust, because the technology can run autonomous without interference from humans, and it is at the same time open source and transparent, so that everybody can look under the hood and see what's going on. It doesn't get any more liberal – so that’s why it’s an obvious choice.” - Mikkel Freltoft Krogsholm, Liberal Alliance. One of Nasdaq's latest initiatives aims to migrate proxy voting, used by shareholders, onto a blockchain solution. Announced by chief executive Bob Greifeld in October, Nasdaq will test blockchain technology to “better manage and streamline the proxy voting process,” starting with a Nasdaq market in Estonia. In the US, Blockchain Technologies Corp is hoping to replace aging voting infrastructure with a secure, open-source solution, that uses distributed ledger technology. “America’s voting machine technology – or lack thereof – is a looming crisis,” states the company. (note most of the commentary on Blockchain’s use for voting was sourced from parts of this article http://bravenewcoin.com/news/factom-dreams-of-a-new-generation-of-blockchain-based-voting-systems/)
Insurance. Imagine…an insurance company is asked to insure the most expensive bottle of red wine ever sold, the Screaming Eagle Cabernet 1992 which sold in 2000 for US$500,000 (yes that is one bottle). Firstly you want to ensure you know exactly who owns it, and if it changes hands, secondly you want to ensure it’s stored correctly to protect it’s value. You’d hate as an insurer to have it change hands and the new owner decides to drink it to find it’s been stored standing up. Imagine now if you had IOT + Blockchain. You can track ownership, location, storage conditions etc and de-risk the insurance policy. You can offer a lower premium to the owner for enabling Blockchain and IOT data to help them analyse the ongoing risk of the policy. Now while this is one example, now imagine that for win collections, where no one bottle is $500K, but lets say many are in the hundreds of dollars each. Is this real, yep sure is, but not for wine, for diamonds. Everledger uses the blockchain to track individual diamonds, from the mine to the consumer and beyond. This solves a couple of long standing problems in the insurance industry that would save insurers over 300 Million pounds every year; Conflict diamond detection and insurance fraud.
Another significant one is digital identities. There are two prominent Blockchain programs all vying for the same space. To be the sole repository of a singular digital ID for every person on the planet. Onename https://onename.com and Bitnation’s Digital Identity http://cointelegraph.com/news/becoming-a-blockchain-citizen These have the potential to have profound effect on all manner of things, from border control (obvious) to fraud prevention, to social security, and even fundamentally flip the world of CRM (customer relationship management – where the company stores data on you, the customer, and uses it or sells it, to ME-RM where you own your data, you share it with who you want, and you get paid for companies to buy it and use it to market to you). Don’t think this is a big deal ? How much money do Facebook, Google and Apple make each year where you give them your data for free, they then onsell that data to those who want to market to you. Why do they need to sit in the middle ? This is a big deal. Consumer marketing as we know could get completely flipped from company led push retail, to consumer secured pull.
Finally another video, for those interested in deeper learning. 17 min video on other uses for Blockchain. This one gets deep, but pretty interesting. Think about completely new organisational structures that capture and own digital intellectual property created by those who are not even employees, then everyone involved gets the benefit of the monetisation of that IP. You’ll learn about Ethereum. Very very intriguing concept. Watch this video only if you really want to take your learning to a level that will unleash your creativity and imagination.
As technology sales professionals we all look back and wish we’d been better able to predict the monumental impact the internet has had on companies, society and the bank balance of those who saw it and captured the opportunity. These types of revolutionary opportunities don’t come around that often. Here is the next one. Whether it is Blockchain or something similar the bottom line is that transforming the exchange of “value" from physical to digital and in turn removing the need for middlemen IS the next big thing. Helping your clients see, understand, grasp and execute this potential is where you can deliver more meaningful impact to your clients, your shareholders, your peers and most importantly, yourself and your family.
Although this was a long read, I hope you stayed with me and read it all. It is such a critically important subject that doing it any sort of justice required a level of depth. Serving up anything less than the above would have failed to provide the inspiration to learn more.
Should you research who some of the innovative Blockchain companies are and partner with them sol solve wicked and super wicked problems for your clients ?
Here’s a graphic that shows the massive massive number of companies using Blockchain just in the financial services sector alone. The sector that is transitioning faster than any other. You will be surprised at just how many there are.
Note: Blockchain has been successfully hacked, so while the underlying concept is robust, the evolution of Blockchain will continue to press ahead with the ambition of being 100% secure and unhackable. Interestingly many say while it’s vulnerable, it is also, even in current form, very very hard to hack. This is achieved through it’s distributed processing and record keeping approach. But an informed opinion is far better than merely an opinion. Will it get better…sure will. Just like the internet has over the past 20 years.