Why Is Blockchain Vital to the Future of Workflow Automation?
We’ve just announced the launch of a new product, BlockAudit, the first in a suite of blockchain-based solutions for workflow automation. It’s a product that’s the first of its kind, and it’s also a product of an authentic convergence that’s absolutely fundamental to the future of digital transformation for modern enterprises.
To understand exactly why we feel workflow automation and blockchain technology are converging at a historic moment, let’s look back at where we’ve already been.
Beginning back in the days of Henry Ford, Frederick Taylor, Henry Gantt and others, the desire to rationally organize work to make it optimally efficient has been with us for well over a century. At times, proponents of scientific workflow management have had an uphill struggle. W. Edwards Deming couldn’t get American companies, especially carmakers, to stick with his methods, but Japanese engineers and manufacturing experts were happy to hear him out. We know how that ended up.
Over recent years, there’s been an important transition taking place as workflow automation and digital transaction management (DTM) have gained ground, often owing to the persistent advocacy of real visionaries within industries and verticals. Many times, they’ve faced the same sorts of inertia and hidebound adherence to “tradition” or “proven methods” that Deming, et al, had to cope with.
What’s the paradigm they’re trying to replace? Manual, paper-bound document processes that, whilst often designed according to the precepts of Six Sigma or BPR, are subject to the same human frailties and systemic inefficiencies every organization has had to cope with since the first day a scrivener picked up a pen or a clerk strapped on a visor.
Automating those processes has, time and again, shown profound positive impacts on ROI, employee morale and client/customer satisfaction.
But even as it’s taken hold in more and more organizations, the wave of digital change around it has brought new forces and threats into play, compelling a next step forward in the evolution of workflow automation.
The upsides for WFA/DTM
After the advent of TCP/IP and the Internet, it went through its own evolution, bringing us to where we stand today: A world where enterprises of all sizes and types, from government agencies to technology giants, rely on broad internet connectivity and platform-based business models, where distributed networks of workers, customers and communities matter just as much as industrial infrastructure. For many businesses, those digital networks and the data-based transactions they permit matter far more than any physical footprint.
Digital transactions are mission-critical for those organizations, and keeping track of them is crucial. Not only does recording them allow analysis of past performance to steer future planning, it’s also a matter of meeting regulations that are becoming prevalent in more countries. Any U.S. firm dealing with the recordkeeping burdens imposed by Sarbanes Oxley can testify to that.
Workflows, operational processes and the assets attached to them – whether it’s a purchase order, a stock transfer certificate or an employee performance review – are of great criticality to any enterprise. Yet up until now, even when those workflows have been automated, they’ve been subject to challenges and problems common across countless organizations.
With workflow automation products built on blockchains, those challenges are met. Actually? They’re resoundingly kicked to the curb:
- Transparency and governance are enhanced since readily-accessible ledgers of document-driven processes help overcome the problem of Balkanized workflows and assets scattered across internal units and functional areas. This improves transparency and internal oversight, particularly important when one considers the sheer volume of workflows underway in an organization of any appreciable size.
- Permanence and ease of auditing are improved since once a record is added to a blockchain, it can’t be tampered with, making it more reliable and durable than internal databases and spreadsheets.
- Security is massively upgraded, vital in an era where black hat hacking, data breaches, and new software vulnerabilities hit the headlines every day (and those are only the ones the public knows about). For businesses dealing with contracts and legal transfers, this is an enormous advantage. Since it utilizes a decentralized network, blockchain can easily withstand malicious attacks that find chinks in the armor of centralized systems.
- Competitive advantages are created since an enterprise can now vouch for a higher level of transparency, efficiency and data protection. For a prospective customer for legal services, financial services, insurance or healthcare, this is an absolute tiebreaker.
Where will it work best?
To be honest, blockchain will likely drive disruption nearly everywhere, from identity and fraud prevention to global logistics and shipping, prescription drugs, even aviation and consumer utilities. Moreover, blockchain-based workflow automation will succeed in any industry or category where digital transactions and document-based processes are important.
At this very moment, though, what are some of the sectors that are most primed to seize the advantages for WFA/DTM we’ve just laid out?
- Legal services and corporate legal operations, especially in crafting smart contracts and other secure documents and processes.
- Financial services, where protection of client information from hackers and regulatory accountability are major challenges.
- Insurance, an industry confronted with many of the same challenges listed above, but also in constant search of new ways to build customer loyalty.
- Government, since protection of constituents’ private information is just one need among many for federal, state and local administrations and agencies.
- Human Resources, also tasked with managing and protecting personal information at scale.
- Technology and IT, where incredibly complex digital ecosystems and infrastructures require equally extensive reporting and recordkeeping.
In our next post, we’ll dive deeper into the specifics of how blockchain-based solutions function in workflow automation, and how these tools integrate across an organization looking to step up to the next stage in the evolution of digital transformation.