There's no doubt that you've heard more than a few things about blockchain and what many believe its potential to be. Whether you are putting any effort into implementing it, or have even begun to engage with it, is another matter entirely.
In fact, it's become somewhat controversial: A study by MediaPost's Research Intelligencer released in February 2019 considered the term "blockchain" to be the most overrated term of 2018. But on the other hand, the sheer intensity of the buzz that's been associated with blockchain technologies is just too much to completely ignore. So it will be worth your while to first determine if your business has a tangible use for blockchain. Then, you'll need to see if you have the personnel who can work on turning blockchain initiatives into realities – and if you don't, it'll be imperative to close that skills gap soon.
Determining the fit of blockchain (or lack thereof)
Blockchain is the core technology behind Bitcoin, the world's best-known cryptocurrency. That medium of exchange is entirely based in peer-to-peer transactions without a central authority, and this principle carries over to all other blockchain applications, as noted in a report by CompTIA's Blockchain Advisory Council. Basically, if most or all of the data your organization traffics in has to be centralized in some way, blockchain isn't going to be worth your while.
That's a narrow criterion all on its own, of course, so you need to look at a number of other major factors as well:
- Data speed and scope: The algorithms that drive blockchain transactions move slowly. Bitcoin averages about 7 transactions per second, whereas high-performance datasets are in TPS ranges of the tens and hundreds of thousands – sometimes even millions. Along similar lines, the literal data blocks in a blockchain currently max out at 1 MB, so any large swaths of data must be stored "off-chain."
- Permanent record: Once a chain is created, its entries can't be modified and exist in whatever form they were originally entered. This is why blockchain could be extremely effective for establishing compliance with certain laws during the life cycle of highly regulated products like pharmaceuticals and aerospace technology – valuable for both regulators and the regulated. Conversely, it's unsuitable for distributing information that one or more parties may need to modify.
- Control/security: Since blockchain involves processes that can be not only viewed but also initiated by any participants, it isn't usually suitable for something requiring central control as a security measure – unless your blockchain model allows for the creation of permissioned users. This is why the technology is so useful for the financial sector, because individual personal information is always encrypted via unique algorithms even if other transactional data is visible.
Addressing the skills gap
Although blockchain may not be useful for all processes of any given business, many companies may end up finding various isolated uses for the technology. The skyrocketing level of demand for engineers with blockchain skills would seem to suggest this – it's up 517% in 2019 versus the previous year, according to Hired. Unfortunately, this need for talent does not necessarily equate to its broad disbursement.
Generally, the biggest, most resource-rich firms manage to take hold of the most in-demand talent first, even if they have to pay through the nose to do so (which is often the case, as elite tech pros know exactly how hot a commodity they are). This leaves other companies to settle for their second- and third-best choices (and sometimes go even further down their priority lists than that), or to postpone blockchain projects as they retrace their steps through the hiring pool. According to Deloitte's 2019 Global Blockchain Survey, 28% of organizations cited lack of in-house skills and understanding as the fourth-biggest impediment to further investment in blockchain technology, close behind security (mentioned by 29% of respondents), regulatory compliance and implementation issues (tied at 30%).
So what is there to be done to address the relative paucity of blockchain skills? Open Access Government contended that one of the best ways to do this is for businesses to forge partnerships with technology studies departments at colleges and universities, with a clear goal of improving their understanding of blockchain. Such efforts could manifest themselves as co-sponsored seminars, roundtables or other educational events – which might attract interest from major innovators in the field.
If feasible from a budgetary standpoint, companies can also create incentives for staff to get involved with academic partnerships by providing partial tuition reimbursement for those who go back to school to hone their tech skills. But no matter what, creating and maintaining continuous learning initiatives – whether within the organization or by working with academic institutions or other organizations – may well be the best move modern businesses have to make if they want to make blockchain an ongoing part of their operations.