New research from UBC Okanagan suggests blockchain technology can improve the sustainability and efficiency of supply chains.

Dr. Babak Tosarkani, an Assistant Professor of Manufacturing Engineering at the School of Engineering, researches supply chain management, operations management and sustainability. New modelling from his lab suggests that focusing on digital transformation and adopting blockchain technology could reduce shipping bottlenecks and provide a clearer end-to-end picture of how items travel from origin to destination.

Dr. Tosarkani applied blockchain technology to complete a deeper dive into the supply of goods from producer to consumer.

“Most people associate blockchain technology with cryptocurrency, but it can provide a consistent and secure system for tracking financial data and logistics,” he explains.

The economic burden of responding to sustainable development and severe socio-environmental constraints have made a considerable impact on supply chain-related decisions, he explains. Being able to increase the integrity, flexibility and monitoring of assets has become a vital issue for sustainable supply chain management.

According to Dr. Tosarkani and doctoral student Samuel Yousefi, as more people and companies embrace environmentally friendly products, there is a need to maintain a transparent and robust tracking system to ensure products are exactly what they claim. The pair investigate the role of blockchain technology in improving the sustainability of supply chain performance in their latest research, published in the International Journal of Production Economics.

While many industries have started utilizing blockchain technology, the integration of this technology into the supply chain is still in its infancy. But this technology can provide definite benefits to managers and decision-makers who are ultimately responsible for ensuring supply chains run smoothly.

“Blockchain technology has not been widely applied in this field due to the lack of familiarity,” says Yousefi. “But from both an operational and a sustainability perspective, blockchain provides tools that the supply chain industry can use that will expedite systems and bolster sustainability.”

Yousefi explains that blockchain simultaneously records the flow of information about all existing processes in a supply chain and automatically shares all that data with other units involved—including the suppliers, manufacturers and retailers—at all stages of a product’s life cycle.

The researchers are currently connecting with supply chain operators to investigate future applications for the integration of these tools into existing systems and processes.

“Blockchain technology can have a paradigm-shifting impact on the supply chain by addressing the sustainability challenges currently being faced, but also challenges we might come across in the future,” says Dr. Tosarkani.