Imagine you’re a soft drink maker. You receive an irate email from a consumer saying the neck of a bottle splintered when they tried to twist off the lid. They sent a picture of the barcode, along with a shot of the broken bottle. Now, you have a problem. You’re aware of the issue and even the production batch, but how do you isolate the cause so that you can address it? Was it defective raw materials? Poor quality control in the final glass melt? It could’ve been an issue in the bottle-forming line, low-impact collisions in the bottling line, or even rough handling during packaging and palletizing. You need a fast way to figure it out. Blockchain has the potential to provide the solution.
Blockchain technology offers a means to achieve supply chain transparency that is impervious to fraud. Although blockchain is touted as protecting manufacturers and consumers from field to shelf, much of the coverage focuses on transactions. That ignores a critical component 3-4 manufacturing processes. If only the raw ingredients and the end products are known, but the two are not related to one another, the plant becomes a black box and traceability becomes extremely difficult.
As a result, applying blockchain to manufacturing is essential to the brand owners, which makes it essential to machine builders, OEMs, and integrators.
Developed to support the crypto currency bitcoin, blockchain is an immutable electronic ledger that is stored and updated on multiple devices simultaneously. A blockchain is made up of a sequence of data/transactions (the blocks) stored in chronological order (the chain). A cryptographic technique called hashing is applied to each block and to the algorithms that connect the blocks in the chain. If either the blocks or the blockchain as a whole are altered in any way, the hashes change and every device on the blockchain becomes immediately aware of it. In order to join the blockchain, a user device needs to present the correct hashes. If any device attempts to hack into the blockchain, the hashes will change and all user devices on the blockchain will be alerted. As a result, the blockchain framework guards against unauthorized access and falsification of data.
Let’s return to the soft drink manufacturer above. The blockchain set up for that bottle or that soft drink makes it possible to track all operations and the condition of each element of the supply chain. If counterfeit bottles were being substituted for bottles from the legitimate supplier, it would be apparent. More to the point, the brand owner can use information stored in the blockchain to quickly identify the full notarized history of the product. Now, they can quickly determine whether the defective bottle was a result of rough handling and distribution or if it was indeed an issue with the glass melt or a problem in the bottling line.
Siemens recognizes the value of blockchain technology throughout the food chain, with a special focus on OEMs and machine builders. In response, we have launched an initiative we call Trusted Traceability. Note that we do not call it Blockchain Traceability because ultimately, blockchain is only one part of what is necessary to create the trusted supply chain.
In our view, Trusted Traceability involves three different components (see figure 1):
- Data captured through the industrial Internet of Things (IoT)
- A scalable tool to manage the blockchain, add data to it, and retrieve data from it
- Blockchain to securely store data and synchronization across supply chain partners
The IoT encompasses a wide variety of sources. Returning to our soft drink example, it might include the temperature and vibration sensors on the motors in the bottling line, and the RFID sensors attached to the palletized product. It could include weather sensors in the factory or GPS systems on the distribution truck. For purposes of the blockchain, it encompasses any device that’s creating data throughout the supply chain that needs to be made readily available to the rest of the supply chain.
From equipment on the manufacturing floor to the product itself, today’s plants generate a significant amount of data that is already accessible to be written to a blockchain. Blockchain is just a tool for securely exchanging data among trusted partners, however; it can’t make sense of the data itself. Gaining value from blockchain requires a way to scrub the raw data and interpret it in a way that makes it valuable to write to the blockchain in the first place. This is why tools for prepping data are so important to making blockchain an effective tool.
Blockchain for equipment builders
Blockchain is a technology that is poised to become essential for manufacturers and brand owners. OEMs and system integrators need to pay attention and understand how it can provide them with a competitive advantage in their markets. Here, we present a pair of use cases.
Use case#1: Blockchain-ready machines and systems
There was a time SCADA systems were the exception rather than the rule. Now, many OEMs and integrators deliver equipment with preinstalled, preconfigured SCADA systems. There are widespread expectations that blockchain will follow a similar arc. It might currently be in the early adopter phase but soon it will be a requirement to remain competitive. This dynamic presents OEMs with an opportunity.
The open-source software exists to enable OEMs and end-users, alike to add data to, or even create, a blockchain. It requires time and expertise, however, not just for one company but for any participating member of the supply chain. At Siemens, we wanted to create a simpler approach that would enable OEMs to focus on building machines and automating processes, not becoming blockchain specialists.
We already produce sensors and smart components for every layer of automation. To support blockchain, our product development teams are working on blockchain-enabled sensors. To help enable blockchain-ready production systems, we are developing modules for our existing production systems such as SCADA and MES to prepare the data for the blockchain.
For data scrubbing and interpretation, we have leveraged a suite of applications from MindSphere, our IoT platform. MindSphere can ingest data from different IoT sources in order to interpret the data, perform analytics on it, or, in the case of our current context, prepare data to be written to the blockchain. We are also partnering with a range of software organizations to add the remaining pieces.
Ultimately, OEMs, machine builders, and integrators can use all of these tools to deliver blockchain-ready equipment to their customers without anyone needing extensive staffing and expertise to support the technology. It provides them with a competitive advantage to win the business from the manufacturers.
Use case #2: Trusted data access
OEMs increasingly market uptime as a service. Although condition monitoring is already in place to support predictive maintenance, remote troubleshooting, and even off-site updates, manufacturers are often reluctant to allow outside access to their equipment, even just to send data outbound. Blockchain provides a solution. We are currently working on a pilot project around semiconductor testing that uses blockchain to package data and test protocols from the machine to the integrator or OEM for verification of processes. In the same way that we can use blockchain to communicate traceability data to consumers, we can use it to communicate other key performance indicators securely to machine builders. The trusted, secure connection makes the concept of accessibility much more palatable.
These are just examples to give an idea of what is possible. Blockchain may have started out as a protocol designed for a specific task but it has become a technology that enables completely new use cases and business models. It is critical for manufacturers to understand that the investments they make today will have an impact on how well they are able to compete five, 10, or even 15 years from now. And OEMs and integrators need to be prepared to make the journey with them.
About the Author
Hunter Beck is digital enterprise industry manager for consumer products at Siemens Industry.Have an Inquiry for Siemens about this article? Click Here >>