Walmart is monitoring the movement of Chinese pork from farm to US dinner table. © Getty Images
Walmart is monitoring the movement of Chinese pork from farm to US dinner table. © Getty Images

Case study: How Walmart uses blockchain

posted by David Craik
9 June 2017

Walmart is trialling blockchain technology to monitor its pork and mango product sourcing


How do you know whether food standards are being met at every step of a complex, global supply chain? Earlier this year Walmart, the world’s biggest retailer with nearly 12,000 stores in 28 countries – and annual revenues of $485.9bn – launched a pilot with IBM and Tsinghua University to test the pork supply chain in China, tracing it from farm to table. Walmart wanted to investigate whether blockchain could serve as an alternative to paper tracking and manual inspection systems, which can “leave supply chains vulnerable to inaccuracies”.

Blockchain is a shared ledger where multiple copies of the same database – stored across computers online – communicate. This allows new entries to a database to be shared with all stakeholders, while constant cross-checking ensures the integrity of existing entries. Food products can be digitally tracked from suppliers to store shelves, and ultimately to consumers, with suppliers uploading farm origination details, batch numbers, factory and processing data, expiration dates, storage temperatures and shipping details.

“This technology could enable me, as the retailer, to be able to digitally track individual pork products in minutes, not days,” explains Frank Yiannas, VP of food safety at Walmart. “I’ll be able to tell if this product is authentic and safe, and when it expires. If a food contamination issue arises at the farm or factory, I’ll know which products to recall and which may be left on the shelves. It could improve supply chain efficiencies, promote sustainability and reduce food waste.”

Alongside the China pilot, Walmart is running a similar test in the US looking at mango supplies. Early results are expected later this month.

Brigid McDermott, VP blockchain business development at IBM, is already evangelical about its use in the supply chain. “It’s more about fixing a social than a technological problem. It’s about making all parties in a supply chain feel comfortable about sharing information. It improves trust,” she says. “Food safety is not a competitive issue. Every part of the chain is affected if there’s a contamination issue. They all want the problem fixed or gone away.”

One of the biggest challenges in the pilots has been around the provision and sharing of information, she says. “We tell our participants that the more they share, the more value they will receive. The potential to transform supply chains is enormous. It can help improve visibility and boost process optimisation and demand management. It will remove inefficiencies.”

Professor Michael Lewis of the IDO Group at the University of Bath School of Management agrees that the blockchain is a route to simpler documentation and contract exchange. “It also adds ‘time stamp’ functionality that is attractive in many industries,” he says. “Challenges are myriad, however, such as who trusts first in putting their data on a blockchain, or worries about data in private settings and being dependent on third party providers. It also won’t stop deliberate illegality such as horse meat contamination and collusion.”

Despite the concerns over sharing information, it seems that the pilot project has broken down some trust barriers in the release of data throughout the supply chain process. In particular, real-time data seems to be more available.

* * *

What is blockchain?

It is the technology behind Bitcoins. It creates a digital, permanent ledger linking blocks of data together in an unbroken chain. This allows users to jointly keep a secure and reliable record of data and transactions.

LATEST
JOBS
London (Central), London (Greater)
£44,759 - £48,540 inc London Allowance
Christian Aid
Nottingham, Nottinghamshire
£38,833 to £47,722 per annum, depending on skills and experience.
University of Nottingham
SEARCH JOBS
CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates
GO TO CIPS KNOWLEDGE