Yesterday, professional services company Accenture announced it is using a blockchain supplier procurement platform dubbed the True Supplier Marketplace. The platform, originally designed to be used by Accenture, will source, onboard, and maintain supplier relationships seamlessly. The consultants now plan to offer the solution as a blockchain software-as-a-service.
Accenture said inaccurate supplier onboarding data and incomplete risk assessment costs businesses about $15 million every year. The problem arises owing to the sheer number and range of suppliers — from multinationals to individual freelancers. Managing these relationships can be complicated and takes up a lot of time and cost. Additionally, duplicate data and manual processes introduce inefficiency, and the legacy systems are the siloed.
Typically procurement departments require suppliers to send a ton of paperwork, which is then vetted and stored internally.
With the blockchain-based True Supplier Marketplace, Accenture aims to provide a new procurement model for buyers. It brings buyers and suppliers on a single shared platform, with transparency in supplier information and certification. Instead of Accenture uploading the data, the suppliers control their own data, and the platform provides a secure way to share it with buyers.
That way, the supplier is able to optionally share information with several buyers that use the solution.
In terms of benefits, Accenture said the True Supplier Marketplace decreases supplier onboarding time by 73% from 15 days to 4 days. The solution reduces manual data entry processes by 39% using automation.
The company achieved a 95% compliance rate through embedded risk assessment and workflow logic. It also reduces costs for buyers as a vendor database is readily available and eliminates duplication of data.
The procurement platform additionally integrates with Accenture’s SAP enterprise system. It can combine blockchain smart contracts and supplier data to pre-populate digital contracts, update ERP systems, and issue invoices. In the coming months, Accenture will also add analytics tools and insights on the supplier onboarding process and team efficiency. Suppliers will be able to share ratings and reviews with buyers to prove their value.
The platform assigns a digital identity to the suppliers, with third-party verifications and credibility scoring. Based on the rating, a buyer can sign contracts with a supplier. Supplier data is shared only with the consent of the owners, and personal information is stored off-chain for GDPR compliance.
The blockchain uses Hyperledger Fabric technology.
Other supplier management projects
Last year, IBM partnered with blockchain developer Chainyard for a Trust Your Supplier blockchain. Other participants in the project include Anheuser-Busch InBev, Cisco, GlaxoSmithKline, Lenovo, Nokia, Schneider Electric, and Vodafone.
Automaker Mercedes-Benz is prototyping a blockchain network to enforce supplier contractual obligations, particularly for sustainability and ethical compliance.
And Swiss pharmaceuticals company Novartis is exploring blockchain technology to ensure suppliers follow labor practices, meet environmental regulations, and maintain quality standards.