While most companies focus on earnings and margins, Silicon Valley leaders view valuation as a barometer of success. Because of this mindset, Silicon Valley companies don’t mind taking big risks as long as they help realize their grand vision.
So in the application of blockchain, we can learn from Silicon Valley. Today, it’s worth following the mindset of Silicon Valley executives to determine how to use blockchain technology in their businesses.
Model 1: What is blockchain risk?
Blockchain itself is an emerging risk, and non-Silicon Valley companies have taken notice. For example, the International Data Corporation predicts that blockchain spending will reach $11.7 billion by 2022 and expand beyond technology and banking.
While blockchain does apply to multiple industries, some leaders still haven’t embraced the solution.
Part of the hesitation stems from confusing blockchain with cryptocurrencies, both of which have pros and cons. On the other hand, one of their hesitancy is that they see a little direct benefit to profits from the blockchain.
In 2019, however, the potential value of blockchain was becoming increasingly apparent. Most leaders who recognize this are taking their use cases seriously, and more skeptical executives are increasingly finding themselves more open to investing in the technology.
Silicon Valley has drawn up a blueprint for embracing blockchain — and it’s time for companies outside the Bay Area to take the plunge and follow suit.
Model 2: Clean up blockchain clutter
Like other emerging technologies, blockchain has brought with it a host of new terms, but they’re not that big a deal.
Those interested in creating unique marketing opportunities for themselves can take advantage of the buzz surrounding terms such as blockchain, artificial intelligence, and big data. These buzzwords help them sell products and services that don’t have any new features or exist.
Model 3: Misinformation is floating around
Executives are understandably suspicious of new technology.
With so much misinformation floating around, it’s easy to understand why executives are skeptical of new technologies and hesitant to adopt more modern solutions to old problems.
To better understand the value of blockchain, leaders must know the truth about several common misconceptions:
1. Blockchain and Bitcoin are the same
While blockchain plays a vital role in the operation of cryptocurrencies, its value does not change with the beginning and end of bitcoin. At its heart, blockchain is a decentralized and secure way to keep digital records. Blockchains are made up of different “blocks” of data linked together using encryption to create strings (or chains) of information stored on various computers.
The opaque and immutable nature of blockchains places them above traditional methods of the recording business. It cannot be tampered with or changed, and each block can be accessed and viewed. In addition, protecting blocks creates a clear and complete set of accountability that is useful for much more than just creating money.
2. Blockchain replaces relational databases
Because services like SQL Server and Oracle cover areas similar to blockchain, some believe it replaces traditional relational databases. However, blockchain platforms are mostly in their infancy and are not intended to replace more entrenched solutions. Blockchain exists only as a complementary option.
3. Blockchain will completely get rid of the role of intermediary
While blockchain does enable Bitcoin to eliminate the middleman in transactions, this is not the case in other applications. As long as the transaction remains within the internal ecosystem, there is no need for external validation. However, mediations can still help with data entry and authentication when interacting with the entire world.
4. Blockchain is simply a public point-to-point system.
The most significant selling point of many apps using blockchain technology is the public nature of transactions. Unfortunately, this transparency has led many enterprises to believe that blockchains can only exist in a public environment or that it is impossible to create applications that rely on permissions. While this is the most common version available today, blockchain doesn’t have to be open to all participants. It can be open only to those who need to know specific information.
Like all new technologies, blockchain will succeed or fail to depend on its application.
Model 4: Executives must dethrone blockchain
Executives need to shed the marketing jargon and grandiose promises that make blockchain look like a tech fad.
Instead, they must identify their core goals and decide whether blockchain can help them achieve them faster.
Model 5: The position of blockchain in today’s business environment
For companies, one of the benefits of Silicon Valley’s adventurous nature is that it allows others to learn from its successes and failures. Here are a few ways blockchain has proven its worth:
1. Coordinate document control and third party sharing
Despite its reputation as an open distribution solution, blockchain is a perfect way to share information securely without letting it fall into the wrong hands. This could be a game-changer in industries such as healthcare, where safety is Paramount. It provides the right people with easy access to comprehensive data, greatly reducing security risks.
2. Work with AI to improve supervision and insight
In traditional workplaces, databases often become data silos — challenging to share across departments or companies. However, blockchain should be shared with those who need it as a perfect universal repository for businesses or entire industries.
This sharing is crucial for better communication and data insight. As more information is collected and shared, machine learning algorithms can train models from more information.
Moreover, what may not be obvious to one expert may be obvious to another with different skills and knowledge — enabling out-of-the-box thinking that is impossible on a data island.
3. Leverage customer data to improve sources
Because blockchain can be easily and securely distributed, partners, can easily collect, read, and analyze information from around the globe. When it comes to determining which suppliers produce the highest quality products, data from customers can provide an accurate insight into the direction of the investigation.
4. Predict the device maintenance mode
Platforms like TMW Systems offer solutions that use blockchain to alert companies when problems arise. They also collect data about each event. Helping companies understand when and why equipment fails saves capital and time in the long run.
Model 6: Blockchain is no longer the best technology for Silicon Valley residents
Any business can use specific use cases, and blockchain is no longer the best technology in Silicon Valley. So it’s not enough for business executives to think about whether to use blockchain, but how to use it better.
Figuring out how blockchain can help companies grow and build on that technology is what all executives should be thinking about.
The development of blockchain technology must be based on application, which requires developers to consider and enterprise managers to participate in.
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