An Effective start to your Enterprise Blockchain project! (Part 2 of 2)
Blockchain and the benefits associated with it could be so overwhelming that in many situations enterprises forget to ask some basic questions before they kick start.
In my previous blog, "An Effective start to your Enterprise Blockchain project! - part 1" I elaborated on some of the important applicability questions one should ask before venturing into a Blockchain project. Here are some more questions for you to think about.
6) Is the business logic involved in solving the problem simple or complex?
Let us consider two situations - one where you need to answer 10 aspects of an entity and say ‘yes/no’ to reach a conclusion versus another where a complex decision matrix has to be cleared to reach a conclusion. Blockchains in its vanilla (value transactions) form is not well suited for complex business logic. However, with the ‘Smart Contracts’ implementation of Blockchain like Ethereum, this could be used for complex programs. But on a different note, are smart contracts considered as legal contracts in current legal system? We don’t know yet. 😊
7) Do you expect very high throughput for handling your transactions?
In case your transactions should happen within milliseconds or the need is to handle many thousand transactions per second, then Blockchain in its vanilla form is not well suited for these type of needs as it becomes slower because inter-node latency increases as more nodes are added. Scalability is one of the major concerns which is still being worked upon.
The next set of questions are more about the viability of such a project than applicability of the blockchain technology.
8) Is there agreement from all the participating parties on the adoption of the proposed business solution which involves application of Blockchain?
The success of a Blockchain project depends on how well the participating parties (consortium) collaborate. Some of the parties participating in an end to end transaction are key to the success of the transaction and if they do not buy into the decentralised/ trust-less system, the project is not a viable one. Also you may need to influence key parties, whose participation is key for success, to collaborate/join you.
9) Can the entire transaction be done digitally or are there parties involved who do not use digital systems?
Say a process needs police verification of criminal records which are not available digitally, but is provided manually as an input into the system then that’s one portion of the transaction that happens outside the ‘chain’. Having many portions of a transaction outside the ‘chain’ will make the system unfit for the purpose.
Also, in case the transaction needs/employs use of external arbitration in case of dispute on data integrity (e.g. in a court of law), then what you will land up having is a quasi-Blockchain system and may not yield the originally perceived benefits. So, evaluate the impact and get consensus before you start.
10) Does any of the key participating parties mandate use of only ‘production ready technology that is stable and /or proven’?
Some organizations allow usage of only such systems due to organisational or regulatory needs. If any of the participating party needs this condition to be met, then your project will not hit production. Blockchain is yet to mature/is not proven in enterprises. Sometimes you want to be first in the market and don’t want to wait but in some cases the only option is to wait.
There are certain technical and non-technical characteristics that Blockchain technology brings, you need to carefully consider them and see if you need those (all/few) to solve your problem and its viability. If not, don’t use Blockchain to solve your problem or try to ride the opportunity.
The questions above are based on the generally understood definition of Blockchain technology (while there is no standard for this). There are too many platforms out there built using Blockchain tech in various ways which may not be fully aligned to the definition that you may know and the characteristics that you may have expected out of a Blockchain implementation. However, they may be built to suit/solve a set of problems in each industry with many additional aspects over and above what the general/vanilla Blockchain technology has to offer.
Other aspects like cost, maintenance, consensus, risks etc. should be thought through as well. Confidentiality is another area that’s still being addressed. So, it goes beyond the above list.
This means once you decide to use blockchains to solve a problem, asking the right questions to select a platform or build your own platform is another important step!
In short, don’t search for a nail just because you have a hammer!
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