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Author's profile photo Kavitha Thangaraj

Blockchain Aids Lean Purchasing and SAP Integration

Innovation begins with Imagination….

Realisation of Industry 4.0 can be achieved if industries not only adopt digitization but also digitalization. Digitisation is about running business in digital form and digitalization is using digital technologies to change the business model for better benefit realisation. Emerging technologies like Machine Learning, Blockchain, Predictive analysis finds perfect fits in Supply chain.

Purchasing being a vital component in supply chain needs to be aligned for digital future in terms of transparency of information among their suppliers and freight forwarders. With this authenticated real time transactions, machine learning technologies can train the system with allied usage of effective predictive analysis. Penetration of descriptive technologies can act as digital assistance in hand with predictive analysis, like a CoPilot to run day-to-day transactions. Further, effective analysis

Blockchain fits inward supplies in purchasing….

Today, purchasing runs in silos due to lack of transparency of customer requirements with its suppliers and freight forwarder, resulting to either piling of inventory or on-time delivery failures.

Blockchain has been described as an information game changer due to its unique capabilities to provide greater information transparency as it records each and every transactions and events happening in the blockchain network providing distinguished provenance along with data immutability. All participants are referred as “peers” and maintains their own copy of the ledger (referred as distributed ledger) that permanently records all transactions in a sequential chain of cryptographic hash-linked blocks.


Blockchain technology assures transparent and authenticated information across the participants in the channel. It’s wise application in purchasing will offer a new degree of integrated ecosystem among its stakeholders for seamless material supplies and enable early warning predictive analytics.

End to end purchasing process can be made part of blockchain and make is work real time and independent of back end tools. Every stakeholders can play their role in the chain and remain authentic in their respective process.

Blockchain Integration with SAP…

Manufactures initiates the Blockchain and stakeholders are registered. Then, purchase requirements are published as blocks and its travels through various phases of delivery acceptance, change acknowledgment, freight forwarder nomination, shipping notification, picking confirmation, monitor the goods in transit, finally goods receipt completion

This can be extended to application of other technologies and establish conversational bot trained by skill builder to assist like a co-pilot in our day to day activities. Copilot accepts or alerts business for the changes in delivery requested by suppliers.

The functionality, can be further combined with Machine learning algorithm to predict ETA (expected time of arrival) of the consignment and execute risk mitigation for unexpected delays if any.


  • Real-time traceability with its history from origin. Here, the ordered materials can be tracked closely to predict deliveries for production planning, yard management for unloading etc.
  • Blockchain is flexible enough to add or delete stockholders. Here, onboarding / off boarding of vendors and freight-forwarders are possible at any point in time.
  • On boarded stakeholders are authenticated with digital signatures and hence unauthorized vendors/freight forwarders cannot participate in the ongoing transactions.
  • Transactions in the distributed ledgers are time-stamped and tamper-proof (immutable and highly secure) as strong cryptographic algorithms used in handling the data, thus providing single source of truth.
  • Reduced costs due to reduction in efforts in regular follow-ups. Manufacturer can perform hassle-free production process without any stoppage due to shortage of materials, vendors can supply on time thus avoiding penalties and the freight-forwarders can minimize their loss in revenues by avoiding the waiting time before the actual unloading of goods.


To move forward in value chain, technologies support us with their new inventions for building various applications. Sometimes reverse protocol also works like emerging technologies can take position and fit itself into relevant applications, one such is use case is “Lean Purchasing” using Blockchain, Machine Learning, Predictive analysis.

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      Author's profile photo Akash A
      Akash A

      Thank you for sharing this.