DHL Case study PDF

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Case Study on DHL...

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Executive Summary This report zooms in and focuses on the company DHL Pty Ltd which is a business that capitalized on blockchain technology and implemented in the business model. Since DHL main focus is on logistics we will be having a look and discussing from the very beginning what blockchain in logistics is and how they operate. Some other key issues we will discuss are what key business problems that the blockchain solution is solving, how the blockchain solution works, what are some added value or benefits that derive from the use of this specific blockchain module and what are some limitations of using this blockchain solution.

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Table of Contents Executive summary…………………………………………………………………………………..……….…………………2 Introduction…………………………………………………………………………………………….……………………………4 a) Briefly explain the context of the business in which Blockchain has been used…………4 b) Explain the business problem that the blockchain solution is solving………………………..4 c) How does the blockchain solution (application) work? Identify the components of Blockchain you learned in week 2 in this use case……………………..……………………………..5 d) What are the benefits of using the specific blockchain solution (for the industry and the organisation)?.........................................................................................................6 e) What are the limitations of using the specific blockchain solution (including legal and ethical limitations)? ......................................................................................................7 Conclusion …………………………………………………………………………………………….…………………………….7 References …………………………………………………………………………………………………………………………..8

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Introduction DHL Pty Ltd is one of the worlds largest logistics company DHL Pty Ltd who are world renowned in over 220 countries and territories specializing in postal service deliveries for the public and logistics solutions tailored for business use, in order to better optimize and improve their supply chain management. They have successfully evolved through the implementation of blockchain and other distributed ledger technology allowing its targeted users facilitate trust and transparency between the relationship of supply chain stakeholders and supporting automation of administrative and commercial process.

Briefly explain the context of the business in which Blockchain has been used The business in which DHL is operating in and using blockchain is within the logistics industry, this part of the process is crucial for nearly every business out there where one small misstep will cause potential failure and shutdown of operations. Logistics is all about the flow of things from one point of origin to another point of consumption to meet set requirements in essence it is the lifeblood if the modern world. It is estimated 90% of world trade is carried out within the international shipping industry every year, complexity issues start to rise behind logistics of global trade as it involves multiple parties with conflict of interest and priorities as well as different methods to track their shipments.

Explain the business problem that the blockchain solution is solving In todays common technology used by the majority for logistics, there is a substantial amount of trapped value which largely stems from fragmented and competitive nature of this industry. A prime example of this is in individual trucking companies with over 500,000 of them in the US and enormous amount of stakeholders involved in this supply chain, often this will cause a lack of transparency, data silos, diverse levels of technology adoption and unstandardized processes. Another key problem is that most parts of the logistics value chain is undermined to manual processes, a example of this is that companies more often then not rely heavily on manual

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data entries and paper based documents to adhere to custom processes. This creates a difficulty in tracking the progress of goods and status of shipments as they move along the supply chain. Majority of the customers challenges that they face or want to improve on are improving their resource management and service quality, optimizing domestic logistics operation as well as distribution network design, reducing overall costs and improving supply chain resilience and flexibility to not be disrupted from unexpected occurrences. These are all very common issues that businesses face in the real world, hence the reason they rely on professional help like DHL which has surfaced into blockchain industry for this reason to give insights and solutions, that are specially tailored and given feedback for the businesses who came in for advice on supply chain improvements in order to grow and expand their businesses.

How does the blockchain solution (application) work? Identify the components of Blockchain you learned in week 2 in this use case. DHL and Accenture for example have created a blockchain based serialisation prototype which has nodes in six geographies to track pharmaceuticals across supply chain system. The blockchain ledger will then track these medicines and is able to be shared with relevant stakeholders such as manufacturers, warehouses, distributors, hospitals, doctors and pharmacies and so on all in a single distributed ledger. This method eliminates the need for intermediaries to act as a trusted third party to verify information and records and to coordinate transactions, as this blockchain infrastructure only allows securely records transactions between parties sharing databases between them and involved supply chain users. From this sensitive data can then be shared securely enabling a much higher level of transparency across all supply chain users and increase its efficiency by reducing the need for red tape and physical paperwork. Because DHL is a service provider of blockchain system that is altered and tailored according to what the business industry is and their needs are, each blockchain will be different from one another. One thing will be in common though which is the implementation of

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information and data that users will need to be open and share with DHL and maybe with their partners and stakeholders in order to find and solve problems they are facing and finding new ways for cost effective opportunities.

What are the benefits of using the specific blockchain solution (for the industry and the organisation)? The added value and benefits that come with using DHL blockchain is faster and leaner logistics in global trade through its use of common Blockchain based system creating a transparency within the supply chain parties allowing them to view their progress of goods, status of custom documents and other vital source of information and data. Through this blockchain network participants are also able to digitalise bill of landing from issuing, transferring or receiving original documents this will significantly reduce the amount of delays, fraud and costs across all sectors of the supply chain. Another key benefit of this is the improvement of transparency of goods across the supply chain overall from the point of origin to their last life will all be possible with blockchain technology. This is done through the initial monitoring of goods provenance from how they are made to how they are being handled and managed, this data and information is then stored permanently and shared across a decentralised network that enables comprehensive track and trace beyond what current technology used capabilities are. Users are then able to authenticate and verify products whether or not they have met handling requirements. This blockchain solution allows a further cost savings by powering leaner, more automated and error free processes within the supply chain. Users are able to access more visibility and predictability within the logistics operations accelerating physical flow of goods. Blockchain allows users to see real time updates of information and in general adds in a extra layer of security protection with a lower probability of being hacked into or breached through the systems unique hash function. The hash function is specially designed for only stakeholder that have the permission or are involve to easily access since there is a private and public key needed to log in they are created in a unique formula which is only known to those inside the circle. 5

What are the limitations of using the specific blockchain solution (including legal and ethical limitations)? Blockchain is a very new and emerging technology which has many upside potentials to deliver but due to this they also have a vast amount of limitations and challenges they will need to face and consider in order to achieve mainstream adoption in all industries. Blockchain technology in logistics main limitation is being adopted to mainstream industries, there is a growing concern for its reliability and accuracy since there is very little information and history behind this new technology. The value and supporting evidence to back them up will be through its community being able to expand and increase to be adopted by a growing number of relevant stakeholders. A legal limitation is the development of standards and governance of blockchain in each industry, as every industry is drastically different from one another the same rule will also be applied within each private permissioned blockchain system created. Hence a organisation body will then be required and in act to set out a core principle, standards and agreements for blockchain and their users to abide by. In terms of ethical limitations blockchains has the ability to possess an immense amount of data and information that are private and sensitive information in regard to business respectively, so there is many assortments of issues that could potentially arise from this for example employees of DHL managing or have the ability to access certain companies blockchain system leaking it out to others or vice versa. Because Blockchain systems are designed to be immutable if a error or incorrect entry has been inputted in it may cause errors on future entries and data along the lines.

Conclusion As we can see here DHLs blockchain technology allows its dedicated users to enable data transparency and traceability to be easily accessible amongst their relevant supply chain stakeholders, which ultimately creates a single source of truth setting out trust that is required between each stakeholders to share information enhancing the intrinsic security mechanism of blockchain technology.

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References 1. DHL 2020, DHL. Logistics For the Connected Age, DHL, viewed 9 September 2020, .

2. DHL 2020, Blockchain is Blockchain the New Internet?, DHL, viewed 9 September 2020, .

3. Heutger, M 2018, Blockchain In Logistics, DHL Customer Solutions & Innovation, viewed 10 September 2020 .

4. Conway, S, Hartmann, S 2018, DHL and Accenture Unlock the Power of Blockchain in Logistics, viewed 10 September 2020 .

5. DHL 2019, The logistics Industry Needs to be Ready for Blockchain. Here’s Why, viewed 11 September 2020 .

6. Ledger Insights 2020, DHL, BMW run blockchain trial for Asia Pacific supply Chain, viewed 11 September 2020 .

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