A new report from HFS Research and Wipro details the state of enterprise Blockchain in 2020.
Although Blockchain become a business buzzword in 2017, the report states that 2020 promises to be the most exciting Blockchain year.
The report, titled “The State of Enterprise Blockchain Market 2020,” said that this year could see Blockchain adoption come of age to solve real-world business problems. It includes more than 300 survey responses from senior executives closely associated with their organizations’ Blockchain initiatives and a review of more than 900 global Blockchain initiatives.
The report found that three-quarters of enterprises surveyed consider Blockchain a strategic priority and driving “tremendous interest” among business and IT stakeholders who want to create new sources of value.
The financial services industry has been an early mover in Blockchain adoption, the report stated, but other industries are catching up quickly. Nearly all enterprise Blockchain initiatives focus on seven broad areas: identity, crypto and digital currencies, trade, payments, supply chain, fraud and compliance, and finance.
“The adoption of Blockchain is nascent but ambitious,” the report stated. “Only 14 percent of Blockchain engagements have reached a production stage; however, the majority want to get there in the next two years.”
The report also cited a 60-30-10 adoption challenge for Blockchain, beginning with 60 percent of enterprises still unclear about Blockchain, highlighting how new the concept is.
“Nearly 30 percent of enterprises are struggling with how to get started, and the remaining few with successful proofs of concept or pilots are struggling to get to production,” the report stated. “A balanced approach to Blockchain is critical to driving meaningful success — you can no longer ignore Blockchain as a value creation lever, but don’t also get sucked into all the hype.”
The report offered 10 recommendations to drive meaningful success from Blockchain, beginning with investigating Blockchain today.
“Nearly 75 percent of respondents agree that Blockchain will become mainstream in the next five years. So don’t sit back and assume that the world is not changing,” the report stated.
Next, it said to beware the hype of Blockchain, as nearly half of respondents (45 percent) agreed that Blockchain was hyped.
“Despite the cryptocurrency bubble-burst in 2018, Blockchain continues to be one of the most hyped emerging technologies. It’s becoming harder to see through the Blockchain hype these days to examine the problems we’re trying to solve, create solutions for, and contextualize in real-world scenarios,” the report stated.
The next recommendation was that Blockchain was not the answer to everything, as the top uses for the technology were getting lost in hype and “mad use cases.”
“Blockchain is not the panacea for everything, and we need to choose the use cases carefully. Only around half of the 940 Blockchain projects reported are the ones that make business sense and created real value for respondents,” the report stated.
Other recommendations included:
- Keep Blockchain investments real. We might not see the true disruptive potential of Blockchains until the adoption of Blockchains becomes more real and widespread for value propositions that create a tangible business impact in the near term.
- Blockchain alone will not solve business problems. Integrated solutions will.
- Blockchain initiatives will not succeed with just a technology focus. A Blockchain narrative purely centered on technology is a recipe for failure — people and processes are equally essential to drive success.
- Create a business buy-in for the Blockchain initiative to succeed. Only 7 percent of business unit heads are allocating budget for Blockchain initiatives, which leads us to question their overall commitment.
- Blockchain requires competitors to come together. Blockchain is the only emerging technology that needs to be deployed across organizations to make an impact. Until organizations are convinced of the value proposition of the hyperconnected world and a sharing economy, Blockchain will struggle to realize the value potential it promises.
- Do not try and do everything on your own. In these early stages of adoption, finding friends that can learn from each other and work through the challenges is extremely important.
· Keep an eye on future technology advancements.