The Blockchain in Transport Alliance (BiTA) has grown rapidly since it was founded in August 2017 from a think tank of seven initial companies (TransRisk, McLeod Software, Convoy, US Express, Triumph Capital, P&S Logistics, and 10-4) to a massive, globe-spanning consortium with over 400 members in nearly every sector of transportation and logistics and over 2,000 current applicants. Major shippers like Shaw Industries and JD.com have joined BiTA to collaborate with parcel carriers like FedEx and UPS, truckload carriers like JB Hunt, Schneider, 3PLs like Coyote, Echo, software companies like TMW, McLeod, and Descartes, finance organizations such as Triumph Capital, insurance companies, law firms, tech startups, and telematics providers. BiTA’s mission is to educate the industry about blockchain and create the open data standards crucial to blockchain’s successful implementation.
FreightWaves caught up with Ken Craig, VP of Special Projects at McLeod Software and co-founder of BiTA, to talk about the organization’s early days and the impetus behind its formation.
“We have a group at McLeod called the ‘Over the horizon’ group,” said Craig, “and our charter is to stay abreast of everything that’s coming at the industry from the future—autonomous technology, platooning, AI, or machine learning—and blockchain fits into that category. We had been investigating it for quite some time. We were trying to plan a session on blockchain for our user conference in September, but we could find very little trucking-specific material on the subject.”
Then Ken Craig eventually made contact with Craig Fuller, who was already brainstorming the idea of an industry alliance around blockchain. The two got to talking and immediately bonded over their shared vision of the importance of data standards. Ken Craig recalled, “My immediate reaction was, 'We have to do this!'"
“I did some work in the health care industry,” recounted Ken Craig. “Congress pushed out a law requiring doctors to use EMRs—electronic medical records—but there were never any standards created. Now there are over 200 branded systems generating these records, they can’t talk to each other, and the whole thing is a mess. However, in Europe, you can visit a doctor in Italy and go to a doctor in Spain the next week and the patient data is there, consistent, and easily accessible.”
“When you talk about the supply chain,” said Craig, “you can’t just solve one problem without impacting other players and parts in the chain, and standards become even more important. In Europe, they have these consortiums, but the government controls them—when you participate, you have the law laid down for you. But we’re trying to do this with a voluntary organization, and it’s a bigger challenge.”
“It wasn’t so much that [BiTA] wanted to pass edicts, but we had to try to develop common standards around data and use cases… if we’re ever going to realize the potential of blockchain, we’ve got to play together, and we needed a body that could provide that leverage,” explained Craig. BiTA saw the opportunity to not only help the supply chain benefit from standards, but also to avoid another EDI mess where 'standards that were never standardized' continue to create tremendous inefficiencies.
As Craig Fuller stated, “Blockchain by its nature is distributed and owned by no single person. It is open source and requires collaboration and standards. We are helping to launch BiTA as a way to initiate dialogue between parties in the trucking ecosystem,” says Fuller. “We have relationships with many of the Alliance members that are not related to blockchain, but the conversation around blockchain keeps coming up and many of them are exploring blockchain, but most are concerned about making significant investments because of the lack of standards and commercial adoption.”
Craig said that many applicants to BiTA understand the risk of being a laggard in adopting new technology, and that FOMO—the ‘fear of missing out’—motivated the surge of interest in the organization last fall when cryptocurrencies were in the news. But industry participants don’t have as firm a grasp on the risk of over-investing in immature technology that is not yet commercially viable. BiTA helps its membership manage both of those risks, taking in and processing input from diverse viewpoints and keeping everyone on the same page.
“If we’re not careful, what always happens when new technology comes out is that people want to put it everywhere,” said Craig. “We’re already seeing some disingenuous marketing where companies want to put something on a private blockchain that is in fact perfectly suited to a normal relational database, and then claim the benefits as being related to blockchain.”
The key, though, is that players from all different points in the supply chain work on the technology together—everyone needs to be integrated into the blockchain network for it to really be valuable. “You can’t just build one piece of a mousetrap—you don’t really have anything until you have the components there—and that’s the kind of the way blockchain works,” said Craig. “I tell companies ‘go ahead, right now, and start learning about blockchain. Get in the Ethereum and HyperLedger sandboxes and start playing around.’ But blockchain isn’t going to fix a bad process. It’s potentially disruptive, but it’s very immature, but CEOs should be in the learning and testing phase, maybe do a proof of concept with a partner. But the technology isn’t ripe for a commercial application—we still need to get everyone on board before we can realize the value.”
Ken Craig also spoke about why McLeod was investing in blockchain and participating in BiTA. “We all know the use cases for the food chain around the whole question of provenance: where a piece of fruit is picked, when it’s palletized, when it crosses the border, etc, and we know there’s a tremendous ROI there. But there’s plenty of things that don’t require blockchain. Working with BiTA members, talking through ideas with different players, and helping define the use cases actually protects our customers and helps them understand where the value lies with this technology. We want our customers to feel comfortable that blockchain will provide them what they need to remain vital and competitive.”
“One thing McLeod does with our architecture is—well, we try not to just throw software at people; we try not to add a bunch of features and present them to our customers. Instead, we extend our architecture with adjunct tools and allow our customers to build their own automated processes and do deep dive analytics for continuous improvement. They love this. Several years ago we created a visual workflow management tool for business process automation, FlowLogix, that gives our customers an easy way to automate workflows and processes. We realized that one of the issues with smart contracts is that business people create the rules and requirements for the contract, then hand it over to a programmer to code, but then that code can’t be validated by the would-be parties to the contract. And once that is placed into a block as a smart contract it is immutable.”
“So what we said,” continued Craig, “is that we can take our FlowLogix tool, and once the business people create the logic and validate the requirements, the tool automatically generates the code required to support that business process… we just wanted to see if we could do it. It’s not something we’re marketing right now, but it will be part of our approach once we’re ready for commercial applications…. we’re demo-ing this function at Transparency18.”
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