David Furlonger - The Real Business of Blockchain

On a recent flight to Dubai, David sat next to the CEO and chairman of a European company investing in blockchain. Over the eight hours, the CEO talked about transforming his familys business from its twentieth-century origins as an industrial extractive company into a real estate developer, and then diversifying into cloud computing and now blockchain. This classic tale of creative destruction executed from inside an organization would seem, on the surface, the least likely move for a company like his, given its old money and old-world history.

Thats how it happens with blockchain. It has captured the business imagination. Many see it as the solution for bringing trust and transparency to digital environments. In doing so, it could expand trade, enable new markets, and provide better tools to manage expensive, opaque processes that cost firms millions of dollars. This promise has made blockchain one of the most popular subjects among clients at Gartner, the global research and advisory firm where both of us work.

Companies in industries as diverse as finance, sports, health care, retail, oil and gas, and pharma are engaging in a wave of blockchain experiments. Theyre hoping to solve intractable issues such as counterfeiting and fraud, inefficiencies caused by opaque or manual processes, and perennial challenges with data quality and data management. Startups are also developing solutions, for example, to innovate movie financing, social media engagement, hospitality, and the gaming industry.

Here are just a few organizations that we spoke with while researching this book:

• The Australian Stock Exchange (ASX) and the Depository Trust and Clearing Corporation (DTCC) are developing blockchain platforms to modernize the mechanisms used for asset clearing and settlement.
• Taipei Medical University Hospital is developing a blockchain solution to facilitate cross-organizational access to patient records, with the patients consent.
• The Union of European Football Associations (UEFA), organizer of the Champions League and Euro football tournaments, is working with IT solution provider ELCA to develop a blockchain solution to prevent fraud and price gougingmajor problems with tickets sold on the secondary marketand to maintain security oversight at tournament venues.
• Volkswagen and Renault are separately using blockchain to create an immutable passport that captures vehicle history and maintenance records to prevent odometer tampering and other costly forms of fraud.
• The city of Austin, Texas, is creating an ID system to help homeless people access medical care and other services.

Expectations for blockchain are well founded. With our colleagues at Gartner, we have estimated that blockchain could generate as much

Yet these returns will not come for free. One of our aims with this book is to substantiate the claims made for blockchain, clarify what is real and what isnt, and help you as a business leader understand what you will have to do to secure your share of the value. With that in mind, we want to emphasize that the way enterprises are talking about and using blockchain today is just an initial step. Beyond operational improvements and increased efficiency, fully mature blockchain solutions will allow you to reengineer business relationships, monetize illiquid assets, and redistribute existing data and value flows in ways that could reinvent how your business engages in a digital world. That is the