Blockchain Is it Really Worth the Hype?

Whether or not to adopt Blockchain is not solely a technological decision but also a business decision. It is obvious that good use cases solve real problems for organizations while great use cases solve real issues. For the decision-makers within an organization, it is essential to not be tempted by the hype alone, and instead reason about whether using Blockchain is a sound business decision—even in those cases where a well-defined solution exists. As with any technology deployment, the primary requirement that a business needs is a place to start. Blockchains’ unique properties, however, have convinced us that a new analytical framework is useful, in part because Blockchain has emerged at a crucial point in society’s technological development.

While the application of technology to improve business processes is nothing new, previous generations of technology were predominantly all about the faster and more secure exchange of information—solutions were aimed at delivering the same objectives faster (e.g., back-office services such as payroll and accounting were digitalized). Blockchain, meanwhile, is about the exchange of value, intended to enable individuals to exchange currency and other assets with one another without relying on a third party to manage the transactions. It is a significantly reliable system in an increasingly trustless world. It also implies the dramatic redefinition of the business processes associated with and between companies. Many private and public, government organizations, banks, communities are adopting blockchain technologies to increase their stock values with high hopes or somewhat overblown expectations.

Blockchain as a tool is intended to enable rapid initial analysis of whether it is an appropriate solution for any defined problem. It is not designed to provide a final authoritative answer and instead assists senior decision makers in evaluating whether to deploy resources in exploring a blockchain-based solution to a given problem space and, if so, at what scale shall it be helpful. The hope is that shifting focus to the business problem, and away from a particular solution, will mitigate the effects of the hype surrounding Blockchain technology and encourage a practical approach while reducing the risk of ill-advised experimentation. To make the task a little easier for everyone, the World Economic Forum Centre for Fourth Industrial Revolution and the Forum’s Global Future Council on Blockchain have jointly created the decision tree method composed of 11 numbers of questions. This whole question and answer kit was designed to assist in defining whether a blockchain is a correct approach for a particular business or not.

Like any other technology, successfully implementing Blockchain requires an integrated business focussed approach, which starts with understanding the challenge, prioritizing value-based used cases, configuring cloud-based tools while leveraging the most impactful approach to drive and deliver on the promised commerce. However, for any organization, Blockchain technology should not be a goal in itself; rather, it should be a tool to achieve specific organizational goals.