The document summarizes a presentation given by Eric Peters, President and CEO of Procurant, about the promise of blockchain in the supply chain. It begins with an overview of blockchain technology, explaining how blocks of data are collected and hashed together in a distributed ledger that can't be altered. It then discusses how miners solve cryptographic puzzles to validate new blocks and link them to the blockchain. The presentation notes that blockchain provides an irrefutable, immutable record of information that could help address trust and information sharing issues that are major impediments to supply chain efficiency. It also briefly explains smart contracts and gives examples of how blockchain could be applied in different sectors, including supply chain management by linking IoT data, blockchain records, and peer

1. NextGen Supply Chain Conference
April 17, 2019
The Promise of Blockchain in the
Supply Chain
President & CEO
Procurant
Eric Peters

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Word Game

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What is
Blockchain?
• A shared database where data can not be changed or deleted (a
decentralized ledger).
• No one organization controls it, it is ruled by a governance
model that is embedded in the system
• Stored procedures to enforce rules (smart contracts)
Think of blockchain as a secure
global computer system in the cloud

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What is a Block?
Data is
collected
A container that holds a certain amount of data
1MB
72 degrees
66 degrees
73 degrees
When the block is full a cryptographic hash is generated

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Generating a Hash with the MD5 Hash Generator
418834d75121566a3eda4cd35606a0bd
d755f875ca8a0489ef5846e1e8171e8e
GO PENN STATE
GO Penn State
• Easy to calculate hash
• Extremely difficult to calculate text from hash

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So why do we need miners?

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Miners Solve Math Problems to Link the Chain
Data is
collected
Block 1
71 degrees
68 degrees
73 degrees
000000000993b0fa44e82e962c7cc3c8
000000009993
b0fa44e82e962
c7cc3c8
Block 2
0000000055ce926456240b2ff0100bde
Nonce
Nonce

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Primary benefit
of Blockchain
Irrefutable, immutable shareable record of
information
The two biggest impediments to supply
chain efficiencies are trust and the sharing
of accurate information.

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What is a
Smart Contract?

11. Smart Contract Definition
A vending machine is a physical device that
implements the conditions of an agreement like
this:
• If you put $2 in, soda comes out
• If you don’t put $2 in, soda doesn’t come out
• If you don’t put $2 in and soda still comes out,
that’s bad
The vending machine encodes this set of rules
and keeps it somewhat secure (or at least as
secure as it needs to be to to protect soda
bottles).
Nick Szabo’s original definition

12. Smart Contract Example
A farmer buys crop insurance
• Days above a certain temperature
• Consecutive days above a certain
temperature
• Rainfall
• Natural disaster events as defined by wind
speed
To file a claim requires documentation by the
farmer.
A smart contract can automatically
fulfill the contract and pay the
farmer for the insurance claim.

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Where does
Blockchain
apply?
Property Records
Medical Records
Financial Records
Tax Records
Voting
QualityAssurance
Supply Chain Management

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Blockchain in the Supply Chain
The two biggest causes of supply chain inefficiencies are lack
of trust and badmissing information.
Technology will support people, information and automation in the future supply chain.
The Eyes The Books The Money
IoT Blockchain P2P Payments

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And What About Data Accuracy?

16. Enterprise Concerns
• I don’t want everyone to see my data
• I don’t want everyone on the
network
• I don’t want to be hacked
• I don’t want inaccurate information
put in the system

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Public versus
Private
Blockchain
• Enterprises demand different requirements
than the public blockchain.
• A private blockchain utilizes Distributed Ledger
Technology
– Permissioned network
– Confidential transaction
– No cryptocurrency required
– Programmable (i.e. smart contracts)
• HyperLedger is an example of a private
blockchain.

18. Governance is a
central issue to
a blockchain
project

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Governance
collides with
technology
utopia

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Blockchain and Food SafetyAtaGlance
• 183 People infected or hospitalized
• 3 fatalities
• 95% reported eating fresh spinach
• Several lawsuits
Multistate Outbreak of E. Coli 157
linked to fresh spinach from Natural
Selections Foods– United States 2006The Spinach Crisis
September 2006
Aug
1
Sept
13
Sept
14
Sept
17
Sept
26
Oct
6
First illness CDC & FDA
officials alerted
FDA
announcement:
“DO NOT EAT
SPINACH”
Spinach
industry comes
to a halt
3 California
counties
targeted
Several companies
falsely implicated.
Media story
grows.
Resulting
Actions
• Leafy Greens Marketing Agreement
• ProduceTraceability Initiative
$74MM lost product | Unit sales fell 70% | 2+ years to recover

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When
Reality and
Technology
Don’t Align
21
Does your lettuce come fromYuma?
Our lettuce comes from Sysco.
Children get sick from eating a cantaloupe.
If you are a mom with cantaloupe in your refrigerator, do
you care what farm or lot it came from?
Are you really going to do a selective recall and trust a 19
year old stocking clerk to only take certain lots off the
shelf?

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How does
Blockchain
work here?

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How does
Blockchain
work here?
23

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How does
Blockchain
work here?
24

25. Thank you