Assessing Blockchain Technology
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Nov 24, 2024
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Assessing Blockchain Technology
Current/ Emerging Technologies (CITM-505-01 AFL)
Parth Kundankumar Patel
Indiana Wesleyan University,
Dr Grant Trudel (aka "Dr G")
9/4/2023
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Introduction
Blockchain technology is one of the most talked-about and revolutionary technologies of the 21st century. A blockchain is a distributed ledger technology in which all transactions are recorded in a public, distributed digital ledger. It is an incredibly secure and transparent system since everyone involved in a network must agree to terms for each transaction. Blockchain eliminates the need for traditional third-party intermediaries, such as banks and other financial institutions, to oversee and store data (Smith & McKeen, 2019). This technology can revolutionize how businesses conduct transactions and share data, no matter the size or extent of the operation.
Blockchain technology is decentralized, meaning it is not controlled by any single entity or person and is composed of many nodes or computers within a more extensive network (Smith & McKeen, 2019). This decentralized system ensures that data is distributed and accessible simultaneously across all computers in the network, eliminating the need for any single server or storage device. The data stored on a blockchain is immutable, meaning it cannot be altered, and is also heavily encrypted, meaning it is almost impossible to access without authorization.
Blockchain technology has a wide range of potential benefits for organizations. It can help reduce business and customer costs through faster transactions, improved payment terms, and decreased transaction fees. It also offers improved security by eliminating intermediaries, increasing data accuracy and reliability, and increasing trust between parties (Smith & McKeen, 2019). Lastly, organizations can also use blockchain technology to streamline and improve their processes and eliminate the need for manual processes.
However, while the potential benefits of blockchain technology may be promising, organizations should assess how well it fits into their current business models. Is the technology
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a good fit for the organization’s operations? Does the organization have the resources, technical capabilities, and personnel to implement the technology successfully? Organizations should consider these questions carefully before investing in blockchain technology, as it can be costly (Salviotti et al., 2018). Moreover, organizations should also weigh the risks and challenges associated with the technology, including potential regulatory issues and data security concerns. Organizations should also be aware that blockchain technology is still relatively new and may require significant investment of time and money. Furthermore, there is no one-size-fits-all solution to blockchain implementation, as organizations must consider all relevant factors before opting for such a technology (Salviotti et al., 2018). As a result, organizations must start by thoroughly investigating the technology and understanding its advantages and drawbacks before deciding if it is right for them. Organizations must also consider the long-term impact of a blockchain-based solution. How much commitment must the organization make to ensure the technology is scalable and maintainable? They must also keep in mind their customers’ reactions to such technologies and make sure that their customers understand the benefits of the technology and its implications (Munim et al., 2022).
Generally, blockchain technology has the potential to revolutionize the way organizations
conduct transactions and share data. It is a secure, transparent, and decentralized platform that can offer numerous benefits to organizations, but organizations must carefully consider how well
the technology fits into their current business model before investing in it. Organizations must also assess all relevant factors and ensure they have the resources and personnel to successfully implement the technology (Munim et al., 2022). By thoroughly investigating the technology and
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its implications, organizations can decide whether or not using blockchain technology is the right
decision for them. Plan
Blockchain technology offers an increasingly attractive solution for organizations looking
to drive innovation and disrupt traditional business methods. While many organizations in various industries have adopted blockchain technology, investing in developing a blockchain system requires careful consideration and due diligence (Alzahrani et al., 2022). To this end, this plan aims to provide a comprehensive assessment of blockchain technology for our organization and outline the steps necessary to determine if it is a worthy investment.
The assessment process will begin with an overview of the technology and explore the potential benefits to our organization. This will include a deep dive into the potential applications
of blockchain technology within our organization, namely, how the technology can support our core business objectives and enable innovative solutions (Alzahrani et al., 2022). We will examine how blockchain technology aligns with our existing technology infrastructure and measure the impact on systems, processes, and personnel. Once the potential benefits and applications of blockchain technology have been identified, the impact of implementing the technology within our organization needs to be evaluated to determine its suitability (Alzahrani et al., 2022). We will assess the return on investment of blockchain technology, balance the risks and rewards, and evaluate the potential cost savings that could be achieved. We will need to consider the impact of implementing the technology on existing processes and personnel and identify critical areas where blockchain technology could be used to
reduce time and labor costs, remove any potential opposition points that could prevent a
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successful adoption, and increase efficiency (Alzahrani et al., 2022). Additionally, data security protocols must be assessed to ensure the data and systems remain secure. As well as assessing the potential benefits of blockchain technology, the risks associated with its implementation must also be considered. One of the most common risks is the time required to develop, deploy, and maintain a blockchain system, which can take months or even years to complete (Alzahrani et al., 2022). Additionally, issues such as data privacy and scalability should be considered, as there are widely varying levels of understanding of the technology among regulatory bodies and vendors that could potentially adopt the technology.
Ultimately, implementing blockchain technology should not be taken lightly and must be aligned with the organization’s business objectives and long-term strategy. This plan provides an overview of the assessment process, as well as an exploration of the potential benefits and risks of implementing the technology (Alzahrani et al., 2022). By executing this plan, we will be able to identify the cost savings associated with adopting blockchain technology, assess the potential impact on existing processes, and determine whether or not it is an appropriate investment for our organization. General Overview of the Plan to Assess the Technology
This plan aims to assess the feasibility of adopting blockchain technology. The plan outlines the steps necessary to assess the technology and provide an overall evaluation of its viability (Tan et al., 2021). This plan includes a comprehensive review of the potential benefits and risks associated with adopting the technology and potential cost savings. Additionally, this plan will include an assessment of the technology's impact on the organization’s processes and systems. Section for Each Concept That Will be Used to Assess the Technology
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Analyzing Current Business Model
Before assessing the potential benefits and challenges of blockchain technology adoption,
it is crucial to analyze the organization's current business model and understand what changes it would need to make to reap its full potential (Tan et al., 2021). Understanding the organization's existing processes is necessary to identify the areas that could benefit from blockchain technology. This requires an analysis of the organization's current workflow, including the systems and software used. Additionally, the organization's existing business model must be evaluated to understand the system's strategic setup better.
Identifying Benefits and Challenges of Blockchain Technology
The potential benefits and challenges of using blockchain technology must be evaluated to ensure its feasibility. The potential benefits of using blockchain technology include deeper insights into transactions, improved security, faster processing times, and lower transaction costs.
Processes such as supply chain management, contract and agreement enforcement, data storage, and digital payments can all be expedited and improved through blockchain technology (Tan et al., 2021). Increasing existing processes' speed, accuracy, and security can lead to greater customer satisfaction and long-term success. The major challenge of implementing blockchain technology is the lack of a unified, standardized infrastructure. Building an infrastructure specifically for blockchain technology can
be expensive and complex, depending on the architecture and services chosen (Tan et al., 2021). Additionally, blockchain technology currently requires a firm reliance on user adoption. Without sufficient adoption, the technology would have limited utility.
Evaluating Potential Cost Savings
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Analyzing the potential cost savings associated with implementing blockchain technology is crucial in determining the overall feasibility of the technology adoption. The potential cost savings associated with blockchain technology include decreases in transaction costs, operational costs, and the cost of compliance (Warkentin & Orgeron, 2020). Blockchain technology can significantly reduce transaction costs due to its distributed and immutable Ledger. Additionally, operational costs can be reduced due to improved transaction speed, automated contracts, and enhanced efficiency. Finally, the cost of compliance can be reduced as processes and transactions are fully recorded and immutable. Assessing Risks Associated With Adoption
The risks associated with adopting blockchain technology must be assessed to determine the project's probability of success. These risks include security risks, scalability risks, legal and regulatory risks, and the risk of failure. Security risks include the potential loss of funds due to security breaches, malicious activities, and the risk of fraud. Additionally, scalability risks include the inability to meet demand, difficulty scaling the technology to meet increasing use, and latency of transactions (Warkentin & Orgeron, 2020). Finally, the risk of failure is due to the potential for the technology to malfunction due to various factors. Legally and regulatorily, the adoption of blockchain technology could be met with pushback, depending on the jurisdiction's laws (Warkentin & Orgeron, 2020). Organizations should carefully evaluate the legal and regulatory environment before adopting blockchain technology.
Determining the Overall Feasibility of Technology Adoption
The overall feasibility of the technology adoption must be assessed after evaluating the potential benefits, cost savings, and risks associated with the project. Carefully evaluating the
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total cost of ownership, including development, operational, and regulatory costs, is essential before proceeding with any blockchain implementation (Erol et al., 2021). The potential of blockchain technology must also be balanced with the risks associated with its adoption. Additionally, the project's feasibility must include examining the organization’s existing resources. Suppose the existing resources are not sufficient to implement blockchain technology. In that case, the organization must look for ways to reallocate resources or partner with other organizations to maximize the system’s potential. Finally, the organization should develop an exit strategy if the project is unsuccessful. This strategy should include evaluating the learning opportunities from the failed project and identifying any potential solutions or process improvements discovered during the development stages. Assessing the feasibility of blockchain technology adoption requires careful consideration
of the associated benefits, cost savings, and risks (Erol et al., 2021). A comprehensive understanding of the current business model and systems and the associated legal and regulatory environment is necessary to maximize the technology's potential. After assessing these aspects and determining the overall costs and feasibility of the technology, the organization can make an informed decision about the potential implementation of blockchain technology.
Description of Team Members and How They Would Be Used in Assessing the Emerging Technology
A team of experts will conduct the assessment of blockchain technology. This team will include members with technology experience, business experience, and risk management experience (O'Rourke et al., 2020). The team will be responsible for comprehensively evaluating the potential benefits, risks, and implementation costs associated with blockchain technology adoption.
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The team will be responsible for the following tasks: Analyzing the organization’s current business model and processes: Analyzing an organization’s current business model and processes will help the team identify potential solutions to existing problems and develop opportunities to maximize efficiency in operations. It will also allow the team to identify areas where blockchain technology could be utilized to enhance the organization’s processes and increase productivity and efficiency. During this process, the team should review the organization’s current operational model, its competitive position within the industry, and any areas where improvements could be made (O'Rourke et al., 2020). Additionally, the team should look at the existing infrastructure and technology used by the organization to determine if they support the adaptation of blockchain technology or require updates and investments to be compatible.
Compiling a comprehensive list of potential benefits and challenges of using blockchain technology: Utilizing a comprehensive list of the benefits and challenges of using blockchain technology will help the team build and assess a realistic implementation plan for the organization (O'Rourke et al., 2020). Some potential benefits that the team should consider include increased reliability, transparency of transactions, immutability of records, improved security, better traceability of data, and increased efficiency of operations. The team should also assess the potential challenges of using blockchain technology, such as slower and costlier implementation, scalability difficulties, and smart contracts' implications for contractual relationships.
Analyzing the potential cost savings associated with adopting the technology: Assessing the potential cost savings associated with adopting blockchain technology is essential for strategic decision-making, as this will help the organization understand the financial benefits of
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implementing the technology. The team should research the potential cost savings associated with blockchain projects in other sectors and assess how these could be applied to the organization (O'Rourke et al., 2020). This will help the team further understand the cost-benefit analysis of a blockchain implementation project and how it could result in cost savings.
Assessing the potential risks associated with adopting blockchain technology: Evaluating the potential risks associated with implementing blockchain technology will protect the organization from potential financial losses related to implementing and adopting the technology (O'Rourke et al., 2020). The team should assess potential legal risks, such as privacy regulations, and technical risks, such as scalability, compatibility, and malicious attacks. Additionally, the team should assess the potential risks associated with using smart contracts and other applications, where solutions should exist for their enforcement.
Making a final recommendation about whether the organization should adopt the technology: Lastly, the team should prepare a final recommendation based on an in-depth understanding of the benefits and challenges associated with adopting blockchain technology (O'Rourke et al., 2020). This should include a detailed cost-benefit analysis, a comprehensive evaluation of the risks and potential downside of adoption, and an assessment of the organization’s readiness to implement the technology. The recommendation should be made with
the full facts and a clear understanding of the technology's potential impact on the organization's long-term success. Conclusion
This plan comprehensively assesses the feasibility of adopting blockchain technology for our organization. It outlines each step necessary to assess the technology, including an analysis of the potential benefits, costs, and risks associated with adopting it (Erol et al., 2021).
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Additionally, it describes the team members and their roles in assessing the technology. By following this plan, our organization can make an informed decision about whether or not to adopt blockchain technology.
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References Alzahrani, S., Daim, T., & Choo, K. K. R. (2022). Assessment of the blockchain technology adoption for managing the electronic health record systems. IEEE Transactions on Engineering Management
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Erol, I., Ar, I. M., Ozdemir, A. I., Peker, I., Asgary, A., Medeni, I. T., & Medeni, T. (2021). Assessing the feasibility of blockchain technology in industries: Evidence from Turkey. Journal of Enterprise Information Management
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(3), 746-769.
Munim, Z. H., Balasubramaniyan, S., Kouhizadeh, M., & Hossain, N. U. I. (2022). Assessing blockchain technology adoption in the Norwegian oil and gas industry using Bayesian Best Worst Method. Journal of Industrial Information Integration
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, 100346.
O'Rourke, B., Oortwijn, W., & Schuller, T. (2020). The new definition of health technology assessment: A milestone in international collaboration. International journal of technology assessment in health care
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(3), 187-190.
Salviotti, G., De Rossi, L. M., & Abbatemarco, N. (2018). A structured framework to assess the business application landscape of blockchain technologies.
Smith, H. A., & McKeen, J. D. (2019). Computerization and management: A study of conflict and change. Information & Management
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(1), 53-64.
Tan, W. K. A., & Sundarakani, B. (2021). Assessing Blockchain Technology application for freight booking business: A case study from Technology Acceptance Model perspective. Journal of Global Operations and Strategic Sourcing
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(1), 202-223.
Warkentin, M., & Orgeron, C. (2020). Using the security triad to assess blockchain technology in
public sector applications. International Journal of Information Management
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, 102090.
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