Blockchain and artificial intelligence (AI) are relatively new technologies that have already make a big impact on company operations.
In 2019, several new business applications are being developed that smart managers should incorporate. Here are five ways blockchain and AI will change business for the better this year.
1. Blockchain for Transparent and Simplified Bookkeeping
At its simplest, blockchain is a bookkeeping tool. It keeps track of who bought what and when. Doing business successfully and ethically requires the management of a database describing that company’s assets and its financial transactions over time. This is a full-time job, as most accountants won’t hesitate to affirm. Where does blockchain enter the mix?
We can expect blockchain to deliver incredible efficiency to the accounting trades. A great deal of a CFO’s, accountant’s or bookkeeper’s working life involves clarifying asset ownership, checking the accuracy of ledgers containing transaction information, and seeing to it that acquisitions and purchases go smoothly.
Blockchain should reduce both the time and expense required for these tasks. There’s no reconciliation of ledgers because there’s just one — and it’s shared among participants and cannot be altered.
The potential is so great that the world might not need as many accountants — or else require them to focus more on the intuitive parts of the job, like valuation and long-term financial planning, and less on the busywork.
2. AI and Business Research
Intelligence-gathering is critical for the day-to-day function and long-term planning of businesses of any size. Until the emergence of neural networks and artificial intelligence, business-related research was conducted by people using web search tools and keywords. Some of the public information of interest to businesses includes:
- Data and analysis from the financial sector
- Past financial transactions and sales from the company in question
- Trending topics in popular culture and news media
- Information from customer interactions across multiple channels
The accumulation and leveraging of text-based data from across business silos and the internet as a whole, better known as big data analysis, isn’t optional anymore. It’s required for competitiveness, for forecasting and for operating leaner businesses with less overhead and waste.
Artificial intelligence provides compelling use cases for helping companies cut through the noise. AI powers tools like natural language processing, which doesn’t just search through and collate public and private records more efficiently than human researchers, but also casts a wider net and isn’t hamstrung by keywords.
We’re seeing more companies build their own natural language processing algorithms to filter out low-quality data and bring the most useful information to the top, all with little intervention from human data handlers, researchers and analysts.
3. Blockchain and the Token Economy
The idea of decentralized currencies goes far beyond bitcoin and Ethereum. Today, all kinds of companies, organizations and governments are exploring the concept of initial coin offerings, or ICOs.
Businesses and currencies exist for roughly the same purpose: to facilitate the exchange of value. Fiat currencies like the U.S. dollar are positively primitive compared with the promise of blockchain and the emerging token economy, which some technologists have taken to calling an asset operating system.
It could even become the basis for a new kind of economy — one where we’ve tokenized everything. Changing times call for new ways in which value changes hands. We don’t just have a gig economy where money is exchanged in increasingly informal ways, such as employees vs. contracted workers, etc. What we have is an economy where any business or organization can monetize just about anything they want to by creating a cryptocurrency fork.
The concept takes the idea of behavioral economics to a brand new place. Blockchain could make it easy for companies to award tokens to customers who recycling a product back to its manufacturer. Nonprofits could create “tree coins” for planting a tree or taking other affirmative environmental actions.
Blockchain even raises the potential to build a new economy around reducing greenhouse gas emissions. Picture CO2 tokens exchanging hands when companies and individuals purchase carbon offsets for their homes or their next trip via airplane.
Trading blockchain for goods, or incentivizing or paying individuals to perform a task or service, is far cheaper and far faster than exchanging the same kind of value through more tangible assets.
4. AI for Smarter Product Design
“Generative design” sounds like a far-future concept, but it’s actually already in use by companies from all kinds of industries, including Black & Decker, Airbus, Under Armour and others. What is it, and how does AI make it possible?
Generative design powered by AI seeks to solve some of the oldest problems in product design and manufacturing: How do you make a cheaper product, using fewer materials, but still deliver the same or better performance?
Product design software built on AI means product designers can input critical characteristics, like the desired weight or even a price range for raw materials. Based on these traits, the generative design software comes up with a number of ways to satisfy the requirements.
In some cases, like with Airbus, the result can be a product that’s barely half the weight of the original part, without sacrificing strength.
5. Blockchain for Supply Chain Authenticity
The world’s supply chains are as complicated as they are vital. Whether it’s food and medicine, replacement parts or finished and unfinished goods crossing seas and oceans, supply chains power the modern world. Unfortunately, national and global supply chains face many lingering problems that are still awaiting credible solutions.
Rooting out counterfeit goods is one of these challenges. Some research suggests that as much as 42 percent of the merchandise changing hands on e-commerce sites like eBay and Amazon could be counterfeit. It’s a problem that costs the global economy about $1 trillion every year in missed earnings.
Companies aren’t the only victims, however. In some recent cases, several hundred people lost their lives due to just one counterfeit product in a pharmaceutical supply chain.
There are several areas where blockchain presents a solution. The first applies the concept of the immutable ledger to the problem of tracing products back to their source. Companies that want to verify chains of custody for shipped goods can apply QR codes and tracking devices to pallets, and fully digitize the process of sending and settling products.
Just by scanning the codes, companies can permanently record all manner of information, including the point of origin and stops along the way, for high-value or high-stakes shipments.
These use cases for AI and blockchain in business barely scratch the surface of what’s possible and what we can come to expect in the coming years.