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A Distributed Ledger for Supply Chain Physical Distribution Visibility

Haoyan Wu, Zhijie Li, Brian King, Zina Ben Miled, John Wassick, Jeffrey Tazelaar
2017 Information  
Supply chains (SC) span many geographies, modes and industries and involve several phases where data flows in both directions from suppliers, manufacturers, distributors, retailers, to customers. This data flow is necessary to support critical business decisions that may impact product cost and market share. Current SC information systems are unable to provide validated, pseudo real-time shipment tracking during the distribution phase. This information is available from a single source, often
more » ... gle source, often the carrier, and is shared with other stakeholders on an as-needed basis. This paper introduces an independent, crowd-validated, online shipment tracking framework that complements current enterprise-based SC management solutions. The proposed framework consists of a set of private distributed ledgers and a single blockchain public ledger. Each private ledger allows the private sharing of custody events among the trading partners in a given shipment. Privacy is necessary, for example, when trading high-end products or chemical and pharmaceutical products. The second type of ledger is a blockchain public ledger. It consists of the hash code of each private event in addition to monitoring events. The latter provide an independently validated immutable record of the pseudo real-time geolocation status of the shipment from a large number of sources using commuters-sourcing. This paper introduces a framework that delivers online shipment tracking information to all stakeholders during the distribution phase of SC. Information flow and exchange is supported by two types of distributed ledgers: private ledgers and public ledgers. Each shipment is associated with a specific private ledger that is only shared by the trading partners involved in the shipment. This design choice seems to go against the principle of transparency being promoted in this paper. However, we deem that it is necessary to retain a level of privacy when the traded products are high value, hazardous or may have dual use (e.g., pharmaceutical and chemical products). The private ledger consists of custody events related to a specific shipment. An example custody event can be the transfer of the shipment from the supplier to the carrier or from the carrier to the customer. The second type of ledger is the public ledger. There is only one public ledger in the proposed framework and it includes events posted by external monitors and the hash values of all the custody events posted to the private ledgers. The monitors are commuters that can validate the geolocation of the truck, which is then associated, by the trading partners, to their specific shipments through the information in the private ledger. The commuters enhance the validity of the tracking information as well as support pseudo-real time delivery of this information. In addition to monitoring events, the public ledger also includes the hash value of the private custody events. As mentioned above, custody events are only shared by shipment-specific trading partners. However, a public record of these events is maintained by posting their hash values to the public ledger. This public record provides an additional validation mechanism for custody events. While this paper focuses on the specific application of the blockchain technology to support supply chain visibility in the physical distribution phase, it also attempts to address the broader divide between completely private/permissioned and completely public/open blockchain architectures. The advantages and disadvantages of either type of architecture have been discussed in [2] . However, more research is needed towards trust architectures that combine the two types of ledgers [3], especially when the protection of sensitive information is critical. The architecture of the proposed system is distributed and uses a hybrid peer-to-peer communication model [4, 5] . This paper specifically focuses on the data model and data representation. The underlying data model uses the EDI-214 (Electronic Data Interchange) standard [6] translated into JSON (JavaScript Object Notation) [7] in order to maintain inter-operability with existing SC information systems. Other aspects of the framework, such as those related to user authentication and cryptographic key management, are out of the scope of this paper and as such not discussed in details. Section 2 of the paper is a review of previous related work. Section 3 introduces the framework and discusses the data representation used for the ledgers and the underlying events as well as the processes that enable the posting of these events to both the private and public ledgers. Section 4 covers the implementation of the framework and exemplifies the framework in operation using a test scenario. Section 5 concludes this paper by highlighting the main contributions and summarizing directions for future work.
doi:10.3390/info8040137 fatcat:mhbemsdbjnfedmgivieromd5ka