About a year ago, I wrote a blog post on my New Year’s resolutions for 2018 blockchain success. They were lead with business, understand the network type, understand the path to productive use, know why you are choosing blockchain, and make sure your architecture is ready. I tried to stick to these resolutions in 2018 and they are still valid today. For this new year, I’d like to share insights from that experience and of course my 2019 resolutions.
Lead with business: The innovator’s dilemma
When I said, “Lead with business” a year ago, I meant don’t just try and execute a technical proof of concept. In addition to this, what I learned in 2018 is the importance of the business case. Blockchain for business is still in its infancy and very much in the realm of innovation and, if you read The Innovator’s Dilemma by Harvard Business School professor Clay Christianson, you know it is nearly impossible to build a business case for disruptive innovation because you are going to disrupt your existing revenue stream. On a number of occasions, my clients and I experienced the innovator’s dilemma!
Basically, my clients looked at what they do today and realized that some of it could become commoditized in the next few years — using blockchain and other technologies. The business case we built was not so much about the part of the business blockchain may be supporting, rather the net new or improved services on top of the now commoditized part of the business. Once you have access to better data via blockchain, what can you do to better fulfill your core mission? If you can get to critical mass of participants or data on the blockchain network, what is the opportunity associated with high value activities that weren’t possible before? These questions drive the business case for investing in the underlying blockchain. A word of caution though: It takes time to get a blockchain network to critical mass.
Legal rights and mandate
This is related to last year’s observation about understanding blockchain network types. One of the core functions we enable with blockchain is the trusted exchange of transaction data between separate legal entities. In order to protect consumers, industry regulators enacted anti-trust or anti-collusion laws. These laws may specify strict rules, which prohibit the exchange of specific data between competitors in a given industry. So, when you look at starting or joining blockchain networks, make sure the networks operate under a legal structure that gives rights to collect and use that type of transaction data in the industry.
For example, the openIDL network was founded by AAIS which, under insurance laws, has the rights to both collect data from insurance companies and sharing the analysis of that data back with insurance companies. I believe in 2019, we are going to see the legal mandate emerge as a deciding factor for what blockchain networks grow or die.
Architectural thinking and multi-cloud
In 2018, we infused a lot of Architectural Thinking into our blockchain engagements. For example, using modern tools like Draw, we created diagrams to document the different perspectives of the distributed architecture. Also, we hardened a GitLab template to make major architectural decisions with our clients, documenting alternatives, rationale, implications, and other important aspects. These practices allowed us to better communicate and eventually reach better outcomes for blockchain-based projects.
Even though blockchain architectures benefit from the cloud, a blockchain architecture is not cloud-centric. I am happy that operating on multi-cloud environments is becoming a reality for blockchain. For one of my clients’ network, we have most of the peers running in IBM Cloud and one peer (for a particular organization) running in AWS.
In a recent interview, I talked about these aspects being applied to the insurance industry. They may not exactly be New Year’s resolutions, but I believe the topics of blockchain business case, legal mandate, architecture and multi-cloud, are going to be top of mind for this next year. My resolution is to have a clear understanding of these aspects for any blockchain project I get involved with in 2019!
The post Three New Year’s resolutions in 2019 for your blockchain success appeared first on Blockchain Unleashed: IBM Blockchain Blog.