Decentralized Digital Supply Chain with marketsN on Amazon Managed Blockchain
By Amey Rajput, General Manager, Blockchain Business – Tech Mahindra
By Nitin Chahar, Sr. Partner Solutions Architect – AWS
In the past year, demand for goods has exceeded the supply chain capacity for most countries. This puts supply chain leaders under immense pressure to ensure customer experience is sustained and improved.
Building a resilient supply chain is not a one-party job, though. It requires collaboration and knowledge-sharing among various ecosystems to enable data sources.
The prevalence of centralized systems can result in a lack of access to trusted data sources which reside in disparate siloed systems across the supply chain.
Traditionally, trust boundaries of enterprise systems are limited to enterprise IT environments. Any hooks to external data sources are executed through point-to-point solutions like electronic data interchange (EDI) which are costly and non-scalable.
Business support is equally critical for success. Large suppliers question the justification of holding control over multi-tier data and, more often than not, decline to support. Furthermore, suppliers beyond Tier 1 often lack the motivation and incentive to support such applications. Hence, a majority of organizations deploying costly solutions fail to scale horizontally, resulting in lower reach.
Tech Mahindra is an AWS Premier Tier Services Partner and Managed Cloud Services Provider (MSP) with a sizable number of clients in supply chain domain. Tech Mahindra has partnered with KoineArth and leverages marketsN capabilities to build use cases personalized to pain points of specific customer enterprise and industry.
The supply chain concerns that marketsN addresses in upstream and downstream scenarios are:
- Improve the decision-making capability at various stages of material souring and finished goods distribution by accessing trusted and updated external datasets.
- Optimize cost of inventory for customers, manufacturers, suppliers, and distributors by monitoring inventory levels at multiple location in real time.
- Optimize the ability to analyze datasets such as raw material, work in progress, finished and goods in transit inventory across internal and external sources.
- Reduce cost of operation and administration by automating multi-party contract and eliminating manual efforts in forward and reverse movement of goods.
- Reduce revenue loss due to counterfeit products introduced in downstream.
- Enable better working cash flow for vendors and partners upstream.
Overview of marketsN
marketsN enables the easy creation of multi-org groups. These B2B transactions are enabled by pre-built inter-organizational workflows.
Underneath the hood, a marketsN group creates a secure, shared ledger among group members to achieve real-time visibility and enable supply chain coordination across group members. A privacy layer ensures transaction data is shared only among group members who need access to it.
Figure 1 – Overview of marketsN platform.
The power of marketsN lies in the flexible notion of a group. Organizations can form multiple groups—each one with a dedicated objective. Following are some real-world examples.
A marketsN group consisting of an original equipment manufacturer (OEM) and its downstream business partners (distributors, resellers, retailers) enables a B2B marketplace. This empowers organizations to combat counterfeits by providing a digital marketplace for authorized distributors, resellers, and retailers to transact with each other.
Automatic contract enforcement ensures invoices are reconciled with contract prices and service-level agreement (SLA) terms between the organizations in the group.
Such a group enables demand visibility which can be used to automate orders and vendor-managed inventory. Where relevant, groups can reduce after sales cost with auditable warranty management and support a secondary market for certified used parts.
Figure 2 – Downstream workflow stakeholders on marketsN.
Digital Supply Chain
A marketsN group consisting of an OEM and its upstream business partners (suppliers, contract manufacturers, lenders) enables a digital supply chain. This empowers organizations to prevent pilferages and optimize stock levels by coordinating inventory distributed across the supply network.
Automatic contract enforcement ensures procurement discounts negotiated with suppliers benefit all group members achieving efficiencies of scale. Invoices and orders in the group become trusted collaterals that can be shared with financiers to enable real-time invoice and order financing.
Figure 3 – Upstream workflow group stakeholders on marketsN.
Digitalization of Logistics
Another example of a marketsN group consists of an organization and its partner logistics service providers (third-party logistics) to achieve digitalization of logistics. Information in the group is stored on a shared ledger and ensures compliance while minimizing paperwork.
Such a group minimizes touchpoints, handovers, and reconciliation efforts. Real-time visibility into digital transactions across multiple hops identifies bottlenecks in and improves speed of operations. Smart contracts which use Internet of Things (IoT) data to evaluate SLA terms during logistics (such as temperature moisture) ensure quality of service.
Figure 4 – Logistics digitalization group workflow stakeholders on marketsN.
Architecture Schematic of marketsN
In marketsN, all users log in with a username and password to receive a valid JSON Web Token (JWT). Once a user completes login, the marketsN user interface (UI) sends the user’s JWT token with every request to marketsN off-chain service.
These services request a Hyperledger Fabric user’s key to vault service (deployed as part of marketsN off-chain services) using the same JWT. The vault verifies the JWT using the OIDC URL, and once authentication is done the respective key is sent back to the off-chain services.
The off-chain services sign the transaction using that key and submits to the Amazon Managed Blockchain Hyperledger network.
Figure 5 – High-level architecture of MarketsN on Amazon Managed Blockchain.
Addressing Supply Chain Concerns with marketsN
marketsN has the capability to engage and integrate current stakeholder systems to build a single distributed application that has end-to-end visibility to supply chain datasets. This helps marketsN to set up a digital twin of supply chain, thereby providing command center capabilities to users.
Furthermore, markets N comes with various customizable group workflows, which makes user onboarding, use case configuration, and application deployment quick.
Real-Time Visibility to Prevent Pilferages and Optimize Stock Levels
With a built-in maker-checker design pattern enforced using smart contracts on a shared auditable ledger, inventory distributed across organizations in a marketsN group is always synchronized.
Every organization knows exactly how much of their inventory is being held across the supply network and who is accountable for what. The built-in artificial intelligence-powered marketbot learns from the distributed inventory data to automate the ordering process in order to maintain optimal inventory levels.
Figure 6 – Functionalities on marketsN dashboard.
Improving Supply Chain Agility by Recognizing Data-as-Asset
marketsN treats data as an asset—inventory, demand, and production data can be exchanged between supply chain partners when the right incentive structures are put in place. It allows such incentives to be realized in terms of discounts, share-of-business, or pure monetary incentives.
Enabling the sharing of data across organizations allows businesses to adapt faster and earlier to demand and supply-side shocks from suppliers. Trends in this data serve as an early-warning system for interruption and establish a recovery plan for critical suppliers by commodity.
The built-in AI-powered marketbot learns from distributed data to get realistic estimates of order completion time which are updated in real time.
Figure 7 – Real-time inventory optimization and overview across Tier-n stakeholders.
Faster, Accurate Payments with Automated Reconciliation
With marketsN, automated invoice reconciliation using smart contracts ensures invoices are always consistent with the pricing and SLA terms embedded in the order. This reduces a huge amount of reconciliation effort across organizations.
The built-in AI-powered marketbot is capable of consuming IoT data from supply chain operations to evaluate and enforce contractual SLAs. This simplifies finance operations and directly impacts bottom line by plugging any leakages due to incorrect billing.
Figure 8 – Overview of marketsN functionalities on iOS and Android apps.
Improving Access to Capital with Real-Time Invoice Financing
Invoice financing requires documents, confirmations, and approvals emailed back and forth, besides requiring each organization to maintain a record. With marketsN, an invoice is a live, shareable, and auditable asset. Any organization which has access to the invoice can validate its authenticity.
In a B2B transaction, the buyer, seller, and lender can all track the invoice as it’s created, accepted, borrowed against, and paid. This simplifies the invoice financing process and reduces the lender’s risk.
Combating Counterfeits with Auditable Track and Trace
Track and trace is a built-in feature of marketsN. As goods move across organizations in a supply chain, their transfer is recorded in a shared, immutable ledger. This creates a digital, auditable trail which can be used to provide assurances about the provenance of a product: from origin to consumption.
Combined with the ability of adding only certified suppliers and resellers to a private group, marketsN creates a trusted B2B marketplace for a manufacturer’s goods.
Managing Warranty, Returns, and Recalls with Unified Operations
marketsN enables the easy creation of multi-org groups containing upstream suppliers, downstream service providers, and OEMs. Product returns, recalls, and warranty claims inside this group are visible in real time as they are created, approved, completed, and verified.
Compliance can be automated by smart contracts. This level of data and process transparency encourages real-time accountability, assures compliance, and drives down operations costs.
For the automotive original parts manufacturing sector, Tech Mahindra built a transparency, visibility, and smart contract-based automation tool that spans from Tier 2 or raw material supplier to client assembly plant warehouses.
The solution enables collection of authenticated real-time datasets from enterprise resource planning (ERP), transport management, warehouse management, and manufacturing process management systems. The data types include order book forecast, inventory visibility of both work in progress and finished goods, invoices status, and payments.
The ability to have a clear view of invoice status and automated dispute management helps component supplier partners in two ways:
- Reduce the efforts and time spent on administrative and operation task for invoice reconciliation.
- Leverage a blockchain-based audit trail and authentication service for invoice factoring that caters the working capital needs of the company.
Manufacturers would be positively impacted both supply- and demand-side stakeholders, with reduction in inventory cost using optimization over major stakeholders.
marketsN enables the creation of a digital twin of your supply network with just a few clicks. With real-time visibility of B2B transactions in your supply chain, silos between organizations are broken down and businesses become connected to their complete supply network. This enables end-to-end visibility, collaboration, agility, and optimization.
marketsN is designed to integrate with and supplement your enterprise resource planning solution via a configurable ERP connector. To accommodate your other partners, marketsN also supports a web interface.
With marketsN, when you track inventory you see network-wide inventory alongside your own. When you see an order, you see its live status. When you see an invoice, you can be assured it’s already reconciled with goods delivered and SLAs negotiated.
Tech Mahindra – AWS Partner Spotlight
Tech Mahindra is an AWS Premier Tier Services Partner and MSP that specializes in digital transformation, consulting, and business re-engineering solutions.
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