Blockchain Adoption in Supply Chain Management and Logistics E-Book

Niels Hackius

• Herausgeber: tredition
• Kategorie: Wissenschaft und neue Technologien
• Sprache: Englisch

Seitenzahl: 262

Veröffentlichungsjahr: 2022

Beschreibung

Blockchain is an emerging technology concept that could be a tool to solve end-to-end integration of material and information flow in supply chain and logistics (SC&L). In this book, you can find three complementary studies on the adoption of Blockchain solutions in SC&L: (1) an analysis of existing use cases in the literature, (2) a 153-response survey outlining expectations for Blockchain in SC&L, and (3) an exploratory, qualitative Grounded Theory study that derives observations on adoption motivations, paths, barriers, and learnings. Blockchain solutions could become a valuable infrastructure tool for SC&L aligning supply chain partners worldwide.

Leseprobe

Blockchain Adoption in Supply Chain Management and Logistics

Vom Promotionsausschuss der Technischen Universität Hamburg zur Erlangung des akademischen Grades

Doktor-Ingenieur (Dr.-Ing.)

genehmigte Dissertation

von Niels Hackius

aus Dresden

2022

1. Gutachter: Prof. Dr. Dr. h. c. Wolfgang Kersten Institut für Logistik und Unternehmensführung Technische Universität Hamburg

2. Gutachter: Prof. Dr. Moritz Petersen Kühne Logistics University

Tag der mündlichen Prüfung: 15. September 2022

Blockchain Adoption in Supply Chain Management and Logistics

© 2022 Niels Hackius

ORCID: 0000-0002-3738-2810

Publisher label: Triceratops Publishing, Wilhelmsburg

ISBN Softcover: 978-3-347-74869-9

ISBN Hardcover: 978-3-347-74872-9

ISBN E-Book: 978-3-347-77301-1

DOI: 10.15480/882.4728

Handle: https://hdl.handle.net/11420/14027

URN: urn: nbn: de: gbv: 830-882.0202019

Printing and distribution on behalf of the author:

tredition GmbH, An der Strusbek 10, 22926 Ahrensburg, Germany

This work is licensed under the Creative Commons Attribution-ShareAlike 4.0 International License. To view a copy of this license, visit

https://creativecommons.org/licenses/by-sa/4.0/ or send a letter to Creative Commons, PO Box 1866, Mountain View, CA 94042, USA.

Publication and distribution are carried out on behalf of of the author, to be reached at: tredition GmbH, department “Imprint service”, An der Strusbek 10, 22926 Ahrensburg, Germany

Thank you

for the love, friendship, freedom, inspiration, kairos, the fish, and everything.

Sophia Kronawitter • Sven Reimers • Irene Zamora • Moritz Göldner

Antje & Ulf Hackius

Sally Lind • Lino Stephani • Susanne Vogel • Maik Gröger • Bente Rathmann Sofa-Café • Franziska Bomba • Paul Craig • Aida & Maren Wichmann Birgit von See • Moritz Petersen • UoT Christoph Loose • Alexandra Elbakyan • Tobias Reaper Lorne Lantz • Loituma Girl •Vladislav Balovatsky • Lea-Marie Becker Julia Craig • Tobias Kronawitter

Summary

The tight integration of materials flow with the flow of information remains a challenge in supply chain and logistics (SC&L). Blockchain is an emerging technology concept that could be a tool to solve end-to-end information flow. It provides a distributed, decentralized ledger of transaction records that are tamper-resistant due to cryptographic methods. Transaction data in SC&L could be a history of state changes, ownerships, or manufacturing steps.

This dissertation addresses the adoption of Blockchain solutions in the SC&L context in three complementary studies. In Study 1, the existing literature is analyzed. A sample of 135 articles is mapped to the use cases and the industries they address. In Study 2, practitioners’ anticipations of Blockchain are surveyed. An online questionnaire yielded 153 responses regarding four use cases as well as barriers and beneficiaries. Finally, in the main study – Study 3 – qualitative data were collected to investigate how companies are adopting Blockchain using an exploratory Grounded Theory approach.

The literature review in Study 1 showed that, overall, there has been little empirical work to date. However, the sample yielded eight major use cases that predominantly address the food and the pharmaceutical industries. Study 2 illustrated that while practitioners expect Blockchain solutions to take hold throughout the industry, regulatory uncertainties regarding the technology’s uses and legal validity as well as the need for collaboration with new partners along the supply chain remain barriers. Study 3 allowed for the creation of a typology of companies’ motivations for starting to work with Blockchain solutions and a model of which adoption paths they choose, the learnings they derive, and the barriers they face.

The conclusion that Blockchain will shape SC&L in the future emphasizes the need to further explore this space. On the one hand, more empirical data should be collected to describe tailor-made concepts that also fit such ecosystems. On the other hand, this also requires solutions for the existing barriers and general strategies for supply chain-wide Blockchain solution deployment. In the long run, Blockchain solutions could develop into a very valuable, massive infrastructure tool that allows one to drive efficiency by aligning supply chain partners worldwide. Further, it could allow for multi-supply chain ecosystems as a basis to offer a range of value-added services, for instance, providing identities, certification, or anticounterfeiting solutions.

Table of Contents

List of Tables

List of Figures

List of Abbreviations

1 Introduction

1.1 Research Objective and Research Questions

1.2 Research Structure

2 Theoretical Background

2.1 Supply Chain Management and Logistics

2.1.1 Supply Chain Management

2.1.2 Logistics

2.2 Blockchain Technology

2.2.1 Technological Concept

2.2.2 Blockchain Implementations, Applications, and Solutions

3 Mapping the Literature on Blockchain in Supply Chain Management and Logistics

3.1 Method

3.2 Results

3.2.1 Overview over the Sample

3.2.2 Analysis of the Use Cases

3.2.3 Analysis of the Research Approaches

3.3 Discussion

3.4 Preliminary Conclusions

3.4.1 Implications for Research

3.4.2 Implications for Management

3.4.3 Limitations and Opportunities for Further Research

4 Surveying Anticipations of Blockchain in Supply Chain Management and Logistics Practice

4.1 Method

4.1.1 Use Case Examples

4.1.2 Setup and Data Collection

4.2 Results

4.3 Discussion

4.4 Preliminary Conclusions

4.4.1 Implications for Research

4.4.2 Implications for Management

4.4.3 Limitations and Opportunities for Further Research

5 Exploring Blockchain Adoption in Supply Chain Management and Logistics Practice

5.1 Method

5.2 Results and Discussion

5.2.1 Motivation: A Company Typology

5.2.2 The Organizational Adoption Path

5.2.3 Practical Adoption Path

5.2.4 External Barriers

5.2.5 Internal Barriers

5.2.6 Learnings

5.3 Preliminary Conclusions

5.3.1 Implications for Research

5.3.2 Implications for Management

5.3.3 Limitations and Opportunities for Further Research

6 Conclusion and Outlook

Bibliography

Appendix A Scales

Appendix B Questionnaire

Appendix C Interview Guideline

Appendix D Interview Sample

List of Tables

2.1 Configurations of Blockchain Access Permissions

3.1 Steps in the Systematic Literature Review Approach

3.2 Databases Used for the Literature Research

3.3 Excluded Articles

3.4 Included Articles by Year

3.5 Articles Identified for the Tracing Goods Use Case

3.6 Articles Identified for the Documenting Goods and Process Steps Use Case

3.7 Articles Identified for the Preventing Counterfeiting Use Case

3.8 Articles Identified for the Transparency Use Case

3.9 Articles Identified for the Decentralizing Access to Information Use Case

3.10 Articles Identified for Improving the Analysis and Measurement of Performance Use Case

3.11 Articles Identified for the Improving Communication Security Use Case

3.12 Articles Identified for the Providing Infrastructure for IoT Devices Use Case

3.13 Articles Identified for the Other Use Cases

3.14 Articles in the Sample Using an Empirical Research Approach

3.15 Embedding the Implications (1-4) for Management in a Process Model

4.1 Descriptions of the Use Cases as Shown in the Web-Based Survey

4.2 Benefits of Blockchain

4.3 Likelihood of Adopting Blockchain

4.4 Embedding the Implications (1-7) for Management in a Process Model

5.1 Typology of Ideal Company Types

5.2 Embedding the Implications (1-12) for Management in a Process Model

5.3 Overview over the Observations

A.1 Scales Used for the Questionnaire

B.1 Questionnaire Used for the Web-Based Survey

C.1 Interview Guideline

D.1 Sample of the Expert Interview Study

List of Figures

1.1 Structure of This Thesis

2.1 Supply Chain Management Framework from the Perspective of a Focal Company

2.2 Overview over the Logistics Sectors in the EU30

2.3 Basic Blockchain Properties

2.4 Overview of a Blockchain solution

3.1 Distribution of Authors of Articles in the Sample

3.2 Overview of Industries and Use Cases

3.3 Overview of Research Approaches and Industries

3.4 Overview of Research Approaches and Use Cases

4.1 Participants and their Companies

4.2 Companies’ Stances toward Blockchain

4.3 Beneficiaries of Blockchain

4.4 Barriers to Blockchain Adoption

5.1 Research Process of Constructing Grounded Theory

5.2 Blockchain Adoption in SC&L: Company Types, Paths, Barriers, Learnings and Their Relationships

List of Abbreviations

API application programming interface

B/L bill of lading

CEP courier express parcel

CRM customer relationship management software

CSCMP Council of Supply Chain Management Professionals

DAO decentralized autonomous organization

DLT distributed ledger technology

EDI electronic data interchange

ERP enterprise resource planning

EU 30 European Union member states, Norway, Switzerland, and the UK

FTL full truckload

GDPR General Data Protection Regulation

HACCP hazard analysis and critical control points

IoT Internet of things

IP intellectual property

ISO international organization for standardization

LTL less-than-truckload

NFC near-field communication

NGO non-governmental organization

PAT principal-agent theory

PLS partial least squares structural equation modeling

PoC proof of concept

RBV resource-based view

RFID radio-frequency identification

SC&L supply chain management and logistics

SME small and medium-sized enterprises

TAM technology acceptance model

UK United Kingdom

WMS warehouse management system

Chapter 1

Introduction

“On the Internet, nobody knows you are a dog,” Steiner’s 1993 cartoon reads. Entirely feasible at the time, in 2020 it requires enormous effort for people to remain anonymous online, with no guarantee of success (Marx et al. 2018; Lufkin 2017; Snowden 2019, pp. 248–252). It could be expected that the same applies to the origins and locations of goods and materials, since information–sharing is considered crucial for supply chain management and logistics (SC&L) (Cooper et al. 1997). Nonetheless, for most supply chains, the tight integration of the material flow with the information flow remains wishful thinking (Kersten et al. 2017; Huong Tran et al. 2016). For instance, it’s almost impossible to track the journey of an avocado’s journey from the supermarket shelf back to the tree that gave it life (Park 2018; Popper et al. 2017).

Effective information-sharing, for instance about the demand changes and the inventory levels of different supply chain tiers, would improve the entire supply chain’s competitiveness (Christopher 2016). It also allows for swift reactions to disruptions that cascade across tiers and the entire supply network (Donadoni et al. 2019). For instance, the Great East Japan Earthquake in March 2011, which ultimately resulted in the meltdown of the Fukushima nuclear power plant, severely disrupted supply chains in different industries (Hendricks et al. 2020). Unexpected demand changes, such as the spike in thermometer sales during the COVID-19 pandemic (Corkery et al. 2020) or more local natural disasters, necessitate immediate overviews over inventory levels, production volumes, and goods in transit if one is to decide on countermeasures. However, optimally organizing the information flow is crucial beyond disruptions. It can benefit supply chain performance and is also a key enabler of future concepts such as closed-loop supply chains in a circular economy (Shekarian 2020).

Electronic data interchange (EDI) – a data standard designed in the 1960s and already split into more than 10 sets (e.g., the UN/EDIFACT ortheGS1 EDI standard) is far from widely used within SC&L (Huong Tran et al. 2016; Hermes Germany GmbH 2017; Ferrantino et al. 2017). Further, even EDI use does not mean the full integration of the flows of information and material. It is more common in practice to use less integrated methods (e.g., telephone and e-mail communication) instead of fully integrated solutions (Hermes Germany GmbH 2017; Huong Tran et al. 2016; Kersten et al. 2017). One consequence is the creation of different versions of the same records in various places: Copies of the relevant information are exchanged through specialized platform providers, or directly from one company to another via physical documents or electronic interfaces (Jabbar et al. 2018; Madenas et al. 2014). For instance, the documentation of freight transports from East Asia to Europe involves around 30 actors, causing 15% of total shipment costs (Groenfeldt 2017; Jabbar et al. 2018).

Blockchain could change this; it is a technology concept that provides a distributed, decentralized ledger of transaction records that is tamper-resistant due to the use of cryptographic methods (The Economist 2015; Popper et al. 2017; Nakamoto 2008; Tapscott et al. 2016; Pilkington 2016). Transaction data in SC&L could be a history of state changes (e.g., locations or temperatures) and ownerships (e.g., shipment handlers, parts manufacturers, or raw material producers). The central promise of Blockchain is that it creates a single and shared data repository, allowing all network members to read or write to its ledger. Its decentralization makes it especially useful in multistakeholder environments with short-lived business relationships (Wüst et al. 2018; Wang et al. 2018; Petersen et al. 2018).

Thus, Blockchain could be the long-sought-after tool that will solve end-to-end information flow for SC&L. First practical concepts include record keeping for the production of jewelry diamonds, shadowing documentation of international container transports, handling and production records of leafy green vegetables and salads, and the identification of truck drivers for container release at the port of Antwerp (Stahlbock et al. 2018; Corkery et al. 2018; Groenfeldt 2017; Yarm 2019).

1.1 Research Objective and Research Questions

The outlined practical examples illustrate Blockchain’s broad spectrum of possible applications in SC&L. However, Blockchain is still a relatively new technology that is not yet widely deployed. Besides, to date, there are only a few practical concepts and even fewer documented learnings in the SC&L context. Thus, there have been few insights into practitioners’ understandings of deploying Blockchain in SC&L is limited; there is almost no documentation on the factors that companies consider when adopting Blockchain in SC&L. Despite this lack of understanding, Blockchain’s impacts on SC&L could potentially be extensive. This thesis pursues the following research objective:

RO: To gain a better understanding of the Blockchain adoption process and its implications for supply chain management and logistics.

This objective stems directly from the observation that Blockchain technology is slowly diffusing into areas beyond cryptocurrencies and the idea therein that each good could have an end-to-end record of every production and handling step.

The research questions address this directly. The first question aims to map the state of the literature. The intention is to outline which use cases have been conceptualized as well as the data gathered therein. The following question is investigated in Chapter 3:

RQ1: How has Blockchain adoption in SC&L been discussed in the literature?

Besides the perspective presented in the literature, the practitioners’ expectations should be investigated, including the extent to which they consider Blockchain applications beneficial and the impacts they think it will have on SC&L. In Chapter 4, the following question is investigated:

RQ2: How have practitioners perceived Blockchain’s benefits and prospects in SC&L?

The results of questions 1 and 2 also motivate question 3: If there are possible concepts and practitioners show an interest in using Blockchain solutions, the considerations on the path to Blockchain adoption in SC&L should be investigated. Question 3, investigated in Chapter 5, is:

RQ3: How have companies been adopting Blockchain in SC&L?

Each research question calls for different research methods introduced in every chapter to answer each question.

1.2 Research Structure

The thesis is structured along the research questions, which are each addressed separately in chapters 3 to 5 (see Figure 1.1). Chapter 2 introduces concepts and terminology regarding supply chain management, logistics, and Blockchain. In Chapter 3, the SC&L literature is reviewed in order to answer research question 1. In Chapter 4, practitioners’ opinions are captured by an online survey to answer research question 2. After gaining an insights into the SC&L literature and taking practitioners’ evaluations into account, approaches to adoption are discussed in Chapter 5 which presents the results of an explorative qualitative Grounded Theory study, investigating how Blockchain could be adopted in SC&L practice. Chapter 6 addresses the achievement of the research objective and provides an overall summary to conclude the thesis.

Figure 1.1: Structure of This Thesis

Chapter 2

Theoretical Background

This chapter outlines the terminology used regarding supply chain management and logistics (SC&L) and briefly introduces Blockchain technology and its key terms.

2.1 Supply Chain Management and Logistics

Supply chains are the continual flow of information, materials, and finances, among other processes necessary for fulfilling customer requests. Managing these supply chains almost always involves the movement of physical goods using logistics services. This tight connection between supply chain management and logistics has led to the terms being used interchangeably.

Depending on the author, these terms have different scopes, ranging from interchangeable use to merely overlapping in parts. Larson et al. (2007) identified four conceptual positions that cover all cases. These include traditionalists, who see “supply chain management as a function or subset of logistics” (Larson et al. 2007, p. 4), relablers, who imply “what was logistics is now supply chain management” (Larson et al. 2007, p. 4), and the intersectionists, who see the strategic parts of logistics decisions as part of supply chain management. The unionist perspective considers “logistics as a function of supply chain management” (Larson et al. 2007, p. 4). In this perspective, the logistics functionalities, transport, storage, and distribution – the material flow of goods and materials – are considered a distinct and separate subfunctionality within supply chain management.

In this thesis, this unionist perspective is assumed, because in practice logistics remains crucial for a functioning supply chain yet is often discussed separately. The abbreviation SC&L reflects the inclusion of both “supply chain management and logistics”. Supply chain management and logistics are defined separately in the following sections.

2.1.1 Supply Chain Management

A supply chain is defined as consisting “of all parties involved, directly or indirectly, in fulfilling a customer request” (Chopra et al. 2016, p. 13). Notably, customer needs drive this material flow that links a network of companies through a stream of materials, goods, and products (Council of Supply Chain Management Professionals 2013, p. 186; Chopra et al. 2016, pp. 13–16).

A simple supply chain may look like this (compare Chopra et al. 2016, pp. 13–16): A parent opens the website of the online retailer Amazon looking for a stuffed toy triceratops dinosaur for their child. Amazon provides an online store and sends the toy to the parent using a courier express parcel (CEP) delivery company. Before it can do this, it must stock the toys that are supplied by the manufacturer (e.g., Steiff) and delivered to Amazon in bulk by a trucking company. Steiff receives its materials (e.g., polyester, fabric, or colors) from different raw material suppliers. Further, both Amazon and Steiff need packaging material as well as administrative services and supplies that they will have to buy from yet another supplier.

This brief example illustrates that supply chains are more complex than merely converting raw materials into a product (Chopra et al. 2016, p. 14; Bowersox et al. 2020, pp. 5–6). In practice, typically, more than one raw material from more than one company is needed, involving multiple suppliers. Likewise, manufacturing requires a network of machines or factories that make intermediary products, parts, or product modules, leading a final product. The sale of this final product is just as complex, because many retail channels, different customer types, and markets exist. Transportation between all these players require logistics operations in an extensive network using different, adequate transportation modes and warehousing.

Supply chain management means to manage the complex network that is a supply chain (Lambert 2014, p. 4). However, supply chain management is more than managing the material flow and the required logistics services (Christopher 2016, pp. 2–3; Min et al. 2019; Bowersox et al. 2020, pp. 3–4). On the one hand, a company’s operational logistics tasks must be augmented by tactical planning and controlling activities (Bowersox et al. 2020, pp. 36–39). On the other hand, supply chain management has a strategic role in companies (Min et al. 2019). Its purpose is to create value for the customers by seamlessly integrating the flow of materials with the other corresponding activities, such as forecasting, order management, and product research (Min et al. 2019; Christopher 2016, pp. 4–14; Lambert 2014, pp. 2–5). Managing supply networks means reaching out beyond company borders for collaboration and business relationships (Christopher 2016, pp. 10–11; Min et al. 2019; Bowersox et al. 2020, pp. 6–7). Figure 2.1 shows this network in the example of a focal enterprise. All the suppliers and distributors are connected to the focal enterprise functions through logistics services as the channel to manage the product flow (Bowersox et al. 2020, p. 6).

Figure 2.1: Supply Chain Management Framework from the Perspective of a Focal Company (the arrows that connect the shapes represent the material flow) (based on Bowersox et al. (2020, p. 6))

As outlined, SC&L unifies many management processes and process flows under its roof (Lambert 2014, p. 3); however, the material flow and the information flow stand out because the other processes (e.g., service or financial flows) depend on these (Bowersox et al. 2020, p. 6; Lambert 2014, p. 3). The previous section introduced the material flow, which involves supplying raw materials to the manufacturer, which turns the materials into a product, which is then sold to a customer by a retailer (Bowersox et al. 2020, p. 6; Lambert 2014, p. 3). This material flow requires the flow of information to correspond to its interactions in the network of suppliers and distributors.

The information flow involves everything from short-term shipment status communication to long-term pricing communications. The material flow, SC&L optimization processes, and all other supply chain management functions require the information flow to function correctly (Christopher 2016, pp. 11–12., 211; Lambert 2014, pp. 3–5). Propagating information upstream allows for more precise demand planning, just as it helps downstream to anticipate changes or delays. The need to share information has long been articulated in the literature and has been identified to cause, for instance, the bullwhip effect (Fawcett et al. 2002; Lee et al. 1997). However, sharing more information can be advantageous because the more integrated the information flow is, the more competitive the whole supply chain becomes (Fawcett et al. 2016).

Thus, optimizing the information flow is an attractive opportunity for SC&L and is expected to be highly disruptive (von See 2019, p. 164; Kersten et al. 2018; Hartley et al. 2019; Büyüközkan et al. 2018). Hartley et al. (2019) and Lyall et al. (2018) note that the role of supply chain management as a business function is undergoing considerable changes owing to the use of more digital tools. However, these tools and overarching concepts of information-sharing across the supply chain network are only diffusing slowly (Lyall et al. 2018; Kersten et al. 2017; Büyüközkan et al. 2018).

2.1.2 Logistics

Logistics services completely take care of all material flows of raw materials, goods, and products inside and between companies from the source to the end-customer. Pfohl (2018, pp. 10–11) and Bowersox et al. (2020, p. 36) described logistics as the business operation involving the order processing, transportation, and anything related to warehousing (e.g., material handling, packaging, and inventory). The Council of Supply Chain Management Professionals (CSCMP) Glossary defined logistics as “The process of planning, implementing, and controlling procedures for the efficient and effective transportation and storage of goods including services, and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements. This definition includes inbound, outbound, internal, and external movements.” (Council of Supply Chain Management Professionals 2013, p. 117). A third way to describe logistics are the four rights of logistics: “to deliver the right product, in the right condition, at the right time, to the right place at minimal cost” (Pfohl 2018, p. 12), often extended by including the right quantity of the product and the correct customer.

In this function, the logistics sector is an integral part of the global economy and has grown continually in the last 10 years (A. T. Kearney 2020, pp. 17, 68; Bundesvereinigung Logistik e. V. et al. 2019). In 2018, with a turnover of over €1 trillion, the logistics sector represented 7% of the GDP of the European Union member states, Norway, Switzerland, and the UK (EU 30) (Schwemmer 2019, p. 35). In the EU 30, logistics services employ more than 13 million people, more than three million of these in Germany (Schwemmer 2019, p. 53).

Especially the steep rise in online sales has boosted the growth of the logistics services sector unitl the end of 2018 (Schwemmer 2019, p. 33; A. T. Kearney 2020, p. 7). However, the direct end-customer sales also puts competitive pricing pressure on the sector (A. T. Kearney 2020, p. 7; Kersten et al. 2017, p. 34). Logistics costs mainly amount to transportation (46% of ≈ €1 120B) and warehousing (32% of ≈ €1 120B) (Schwemmer 2019, p. 41).

In 2018, more than 18 billion tons of materials and goods were moved by EU 30 logistics services. The vast majority of this transport volume was handled through road transport (≈ 77% /14.6B tons in 2018) (Schwemmer 2019, pp. 34–35). However, the other key transportation modes with less overall volume include ocean (≈ 9%/1.7B tons in 2018), railway (≈ 6%/1.2B tons in 2018), inland water transport (≈ 3%/0.5B tons in 2018), and, at much lower volume, air transport (≈0.05%/0.1B tons in 2018) (Schwemmer 2019, pp. 34–35). Pipeline transport made up 4.4% (0.9B t) of the total transport volume in 2018, which helps to understand that logistics is more than transporting goods from manufacturers to end-customers (Schwemmer 2019, pp. 34–35).

Figure 2.2: Overview over the Logistics Sectors in the EU 30 by Logistics Segments (in billion € and % of a €1 120B total) (data from 2018 according to Schwemmer (2019))

Various logistics companies from different service segments carry out the fulfillment of these services. Figure 2.2 provides an overview: Contract logistics providers, also called integrated logistics providers (ISPs), third-party (3PL), or fourth-party logistics (4PL)1 providers, allow companies to outsource their logistics tasks (Schwemmer 2019, pp. 55–57; Bowersox et al. 2020, pp. 11–13). These companies take care of all logistics tasks by organizing warehousing and transport, typically utilizing IT services and sometimes even providing consulting services for their customers’ (Schwemmer 2019, pp. 55–57; Bowersox et al. 2020, pp. 11–13). Ocean and air freight refer to the carriers that specialize in these transport modes. Bulk logistics refers to the moving of bulky materials such as coal, sand, grains, or chemicals (Schwemmer 2019, p. 55; Bowersox et al. 2020, p. 7). These are typically moved by rail, inland barge, or truck fleets that specialize in moving high volumes of these liquids or raw materials (Schwemmer 2019, p. 55; Bowersox et al. 2020, p. 7). Full truckload (FTL) and less-than-truckload (LTL) refer to road transports in semi-trailers or shipping containers. Unlike FTL, LTL service providers combine multiple parties’ freight, often not delivering the freight directly, but collecting and distributing them locally through terminals and cross-docks (Schwemmer 2019, p. 55). FTL and LTL providers typically use standardized semi-trailers or trucks. In contrast, specialized transport logistics providers provide services or machinery with a focus on specific products or markets, for instance, special trucks for perishables, livestock, or waste, or special handling for museums, textiles, or large machine parts, such as wind turbines (Orf 2014; Bowersox et al. 2020, p. 193; Schwemmer 2019, p. 55). Courier express parcel (CEP) refers to logistics services that deliver parcels (typically up to 31.5 kg) or documents door-to-door (Schwemmer 2019, p. 56; Bowersox et al. 2020, pp. 197–200). Warehousing services are independently operated storage and handling facilities. The numbers in Figure 2.2 show their turnover beyond contract logistics.

Depending on the segment, all these companies have a different market reach and specialize in different customers. For instance, CEP logistics operators such as DHL or UPS operate worldwide. They can quickly deliver parcels and documents door-to-door, yet there are bike messengers who address customers who need even quicker, more local courier services (Maes et al. 2012). Accordingly, in practice, it is usually necessary for different logistics service providers to work together to achieve end-to-end materials and product flow. During these logistics services, the supply chain management processes running in parallel must be addressed. In particular, it is crucial that the information flow be managed, because missing information can lead to interruptions. The ways logistics service providers provide information depend on their task and service segment. Large contract logistics providers often have more tightly integrated systems that integrate with strategic partners and provide customer interfaces, while smaller companies serve these manually (Huong Tran et al. 2016; Hermes Germany GmbH 2017).

Figure 2.3: Basic Blockchain Properties (see also Hackius et al. 2017)

2.2 Blockchain Technology

Blockchain is often used interchangeably and depending on the context. The meanings range from references to the technological concept generally to software implementations such as Bitcoin or Ethereum or user-facing applications. To prevent confusion, the underlying technological concept of a Blockchain and the differences between the terms Blockchain solutions, Blockchain applications, and Blockchain implementations will now be outlined.

2.2.1 Technological Concept

Blockchain is a software technology concept that provides a distributed, decentralized ledger of transaction records that are tamper-resistant due to the use of cryptographic methods (Nakamoto 2008; Buterin 2013; The Economist 2015; Pilkington 2016). Figure 2.3 illustrates the technology concept of a Blockchain and its three basic properties. Authors occasionally prefer to use the superordinate term distributed ledger technology (DLT) when referring to Blockchain technology concepts (Roeck et al. 2020). A distributed ledger is not necessarily a Blockchain, because it does not necessarily provide immutability or a consensus algorithm.

In a Blockchain concept, decentralization utilizes a peer-to-peer network run by its members (Nakamoto 2008; Buterin 2013; Pilkington 2016). Thus, the members do not rely on a central operator or a centralized infrastructure; each member can add transactions to the ledger by sharing it within a Blockchain peer-to-peer network; and all the participants work with the same state of transaction data, preventing disjunctive, local versions of data.

Transactions are verified, because the network members must sign their transactions using asymmetrical cryptography before sharing them with the network (Nakamoto 2008; Buterin 2013; Pilkington 2016). Only the owner of a specific private key owner can initiate transactions belonging to the corresponding public key. The keys are not necessarily directly linked to real-world identities; however, a shorter representation of the public key serves as a pseudonym in many Blockchain implementations.

The immutability of the Blockchain is achieved by using a consensus algorithm that groups one or more transactions into so-called blocks (Nakamoto 2008; Buterin 2013; Pilkington 2016). Each block holds the cryptographic hashing value of the previous block, making the blocks interdependent. This interdependency links the blocks in a chain – the Blockchain. All the network members can verify the transactions in a block and its interdependencies. If there is no consensus on a block’s validity, it is not included in the Blockchain. Retroactively altering a Blockchain transaction would require altering the block that includes the transaction; however, this can only be achieved by gaining consensus and additionally altering the cryptographic hashes of every following block in the chain. Ideally, gaining this consensus is only possible for valid changes.

Figure 2.4: Overview of a Blockchain solution

2.2.2 Blockchain Implementations, Applications, and Solutions

In this thesis, three terms are used: Blockchain implementation, Blockchain application, and Blockchain solution. Figure 2.4 provides an overview over the terms, and the arrows indicate read and write operations. Blockchain implementations are software packages that provide a Blockchain communications protocol. Blockchain applications use the features of this software to build programs that humans or machines can use to perform an activity. Blockchain solution describes the overall system, including the Blockchain application, its APIs with interfaces to other enterprise software, and recording or identification devices needed for external input.

Blockchain solutions can serve as a shared data basis among companies, because the transaction data can be associated with virtual or physical goods. The transactions stored on a Blockchain are immutable, creating a data basis that both transaction partners can trust. In practice, this makes Blockchain solutions attractive, because they may improve the information flow for SC&L functions.

It is crucial to understand that a wide range of Blockchain implementations exist, each featuring different functionalities, development modes, and consensus algorithms. Not all Blockchain solutions set up their implementation as genuinely decentralized, verified, or immutable. All these functionalities can be disabled or replaced by centralized services to limit reading or writing operations for data on the distributed ledger (Abelseth 2018; Huertas et al. 2018; Novotny et al. 2018). Large Blockchain-based networks suche as the Bitcoin network or the Ethereum network are publicly accessible and allow every participant to read, write, and verify transactions. Table 2.1 shows scenarios of participants limiting these operations, yielding private permissioned or public permissioned