1. Blockchain

How Hyperledger’s DLT Enables Supply Chain Modernization

Disclaimer: This is a user generated content submitted by a member of the WriteUpCafe Community. The views and writings here reflect that of the author and not of WriteUpCafe. If you have any complaints regarding this post kindly report it to us.

For decades, supply chain management has been an integral part of most organizations worldwide. Similarly, supply chain management plays a key role in boosting the global economy. However, due to rising security threats and evolving consumer demands, the present supply chain management is facing various challenges in providing a trustworthy and highly-efficient ecosystem to all. Therefore, introducing Blockchain in supply chain management is an effective solution that might bring developments in the problematic state of the present supply chain ecosystem.

Challenges in the Current Supply Chain Management

Fragmented Database – Several organizations are still managing their database restrained to themselves. Supply chain departments are preparing their individual records and distributing them to other parties or teams merely on request. This practice leads to communication gaps, which benefits the exploiters.

Ineffective Traceability of Assets – Another existing challenge in supply chain management is the incapability to trace assets. Organizations have deployed the finest equipment and processes for monitoring in-house activities, but no such method to track the state of products after dispatched for delivery. As per recent research, around 69% of companies do not have total visibility into their supply chain operations. Therefore, the chances of asset theft and ghost assets are higher.

Excessive Costs – Since traditional supply chain management teams build and maintain an individual database for operations, they often invest their resources and efforts into gathering the same data on a regular basis. This brings a drastic rise in the costs associated with processes (like IT costs, inventory management costs, finance, and planning costs).

Tedious QA Process – Because of incoherence in the present SCM, it is a time-intensive and complex task for businesses to identify at which point the product has been replaced or the product quality has been compromised. Moreover, because of a centralized structure, traditional SCM processes are highly vulnerable to risks like code of conduct violations and fraud.

The challenges mentioned above mainly arise because of major reliance on a centralized infrastructure. Therefore, businesses need to shift the supply chain paradigm to a decentralized Blockchain system like Hyperledger.

What is Hyperledger Blockchain?

Hyperledger Blockchain is an open-source project designed to support the development of electronic ledgers (instead of maintaining data within a traditional ledger). It offers a modular architecture that expresses roles between nodes, configurable consensus services, and the execution of smart contracts. Exclusive features of Hyperledger include the use of smart contracts, as well as pluggable consensus protocols. Hyperledger also supports different programming languages through the integration of modules. With Hyperledger technology, an organization can improve the transaction performance and efficiency in their business processes. Organizations can partner with the right Hyperledger development company to build Blockchain-based applications using robust frameworks, standards, tools, and libraries.

Why Hyperledger for Supply Chain Management

Hyperledger’s Distributed Ledger Technology (DLT) is an effective solution for a wide range of supply chain problems. Traditional supply chains usually rely on centralized systems which operate in silos with low or no data-sharing. Besides, traditional SCMs lack the intelligence to discover problems along the value chain rapidly.

With Hyperledger-powered supply chain management, one or more transactions are stored on different blocks. These recordings are then shared over a network of computer systems in the Blockchain, which makes the data highly transparent and accessible. Every single transaction that happens in the supply chain is archived on the distributed ledger and displayed in real-time, enabling each participant an active stakeholder in all stages of transactions.

Features of Hyperledger Blockchain in the Supply Chain Management


To execute a legitimate transaction in Hyperledger Blockchain, all associated participants have to agree. No new blocks can be created or no changes can be made inside a distributed ledger without consensus. This means that all participants will be notified when a change is being made and need to approve equally to ensure changes. For the supply chain, Hyperledger Blockchain technology can be used to implement consensus to a wide range of transactions like warehouse management, provision, and transportation.


Indeed, the major feature required in the supply chain is provenance. Hyperledger Blockchain technology allows organizations to know accurately where products or raw materials originated and where their present supply chain is becoming fragmented.


It’s almost impossible to alter with an entry in the Hyperledger’s distributed ledger. After a transaction, numerous copies of each entry will be generated. Implementing Hyperledger Blockchain in the supply chain makes it incredibly hard for exploiters to falsify inventory records, payment transactions, warehousing settings, distribution times, etc.


The shared ledgers hold only reliable forms of information. This promotes trust as all participants can have a transparent view of the transaction. With Hyperledger Blockchain, supply chain departments can have a finality that eases disputes and can promote better relationships among all partners.

Crucial Benefits of Hyperledger Blockchain on Supply Chain

Replaces Manual Processes

Several supply chain processes, specifically those in the lower supply levels, are slow and rely almost entirely on paper-based procedures. Hyperledger Blockchain technology in the supply chain can swap these manual processes using an end-to-end digital process that provides new levels of security and transparency.

Enables Better Traceability

Evolving regulatory and consumer demand for provenance data is already driving significant change in the supply chain ecosystem. The Hyperledger application development with trace and track functionality offers the supply chain teams greater transparency across diverse operations. This leads to better delivery times, seamless utilization of inventors, improved quality, and reduced loss of revenue from counterfeit or illegal market products.

Limits Supply Chain Transaction Expenses

With the ability to develop its native currency using chaincode, Hyperledger Blockchain allows organizations to execute cross-border funds exchanges without the need for banks. This indicates that Hyperledger in the supply chain can speed up transactions while limiting the incurred fees.

Besides, supply chain operations can be triggered automatically through the Chaincode. It is the collection of programs that run on top of the Hyperledger Blockchain to implement the business logic of how operations interact with the ledger. For instance, a Chaincode may set out for the contracted delivery of a product and what should happen if the delivery is missed or late. It can track the delivery and spontaneously trigger actions when the process is ruptured. This approach significantly reduces costs and improves the efficiency of overall supply chain processes.

Streamlines Quality Check Process

Another benefit of Hyperledger app development for supply chain departments is streamlining and ensuring better product quality checks. Without the help of Blockchain, delivering full transparency by supply chain departments requires greater support from IT teams. In addition, to track and trace functionality, Hyperledger Blockchain simplifies product quality control checks via immutable documentation. This ability removes the need for on-site quality control to validate checks as concerned parties can access the data from the document. Moreover, the need for audits by management leaders can be reduced as authorities can use the Hyperledger Blockchain app to gain full visibility into the required documents.

Wrapping Up!

By implementing a private ledger that is immutable, secure, distributed, and transparent, Hyperledger Blockchain in the supply chain is helping organizations to modernize processes and reduce operational costs while optimizing the ecosystem. With a Hyperledger-powered supply chain management system, organizations can reap substantial benefits like cost-effective and accurate transaction processing.


Welcome to WriteUpCafe Community

Join our community to engage with fellow bloggers and increase the visibility of your blog.
Join WriteUpCafe