Skip to main content
SpringerLink
Log in

Supply Chain Virtualization: Facilitating Agent Trust Utilizing Blockchain Technology

  • Chapter
  • First Online:
Revisiting Supply Chain Risk

Part of the book series: Springer Series in Supply Chain Management ((SSSCM,volume 7))

Abstract

In this chapter , through the lens of information security , we discuss the use of blockchain technology as a mechanism for facilitating trust between various supply chain agents. The goal is to explicate the use of blockchain technology as a distributed ledger to mitigate a varied set of risks to supply chain virtualization , whereby various agents within the supply chain context can engage in transactions with an immutable and cryptographically secure record. This immutable and secure record would then serve as the foundation of a mutually beneficial relationship, built upon the blockchain technology , by engendering greater trust among supply chain agents. The usefulness of blockchain technology is such that it enables information to be stored using a cryptographically secure hash and be distributed among multiple record-keeping nodes. Each agent within the supply chain context can act as a node and, by maintaining a copy of the record, create a distributed ledger of information. This provides two distinct benefits that facilitate trust among agents within the supply chain context; first, agents acting as nodes within the blockchain possess a copy of the information record, which cannot be altered without their consent. Second, information is stored on the blockchain using a secure method of encryption that provides protection against tampering from malicious sources and security of the information contained on the chain. Therefore, these two benefits of blockchain technology provide supply chain agents with powerful trust-building mechanisms, which extricate fear and allay concerns when interacting with new or unknown agents.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 139.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 179.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  • Abeyratne, S. A., & Monfared, R. P. (2016). Blockchain ready manufacturing supply chain using distributed ledger. International Journal of Research in Engineering and Technology, 5(9), 1–10.

    Article  Google Scholar 

  • Akkermans, H., Bogerd, P., & Van Doremalen, J. (2004). Travail, transparency and trust: A case study of computer-supported collaborative supply chain planning in high-tech electronics. European Journal of Operational Research, 153(2), 445–456.

    Article  Google Scholar 

  • Apte, S., & Petrovsky, N. (2016). Will blockchain technology revolutionize excipient supply chain management? Journal of Excipients and Food Chemicals, 7(3), 76–78.

    Google Scholar 

  • Awaysheh, A., & Klassen, R. D. (2010). The impact of supply chain structure on the use of supplier socially responsible practices. International Journal of Operations & Production Management, 30(12), 1246–1268.

    Article  Google Scholar 

  • Ba, S., & Pavlou, P. A. (2002). Evidence of the effect of trust building technology in electronic markets: Price premiums and buyer behavior. MIS Quarterly, 26(3), 243–268.

    Article  Google Scholar 

  • Bheemaiah, K. (2015). Blockchain 2.0: The renaissance of money. Retrieved from https://www.wired.com/insights/2015/01/block-chain-2-0/.

  • Bloom, J. D., & Hinrichs, C. C. (2016). Informal and formal mechanisms of coordination in hybrid food value chains. Journal of Agriculture, Food Systems, and Community Development, 1(4), 143–156.

    Google Scholar 

  • Boyson, S. (2014). Cyber supply chain risk management: Revolutionizing the strategic control of critical IT systems. Technovation, 34(7), 342–353.

    Article  Google Scholar 

  • Bygballe, L. E., Dewulf, G., & Levitt, R. E. (2015). The interplay between formal and informal contracting in integrated project delivery. Engineering project organization journal, 5(1), 22–35.

    Article  Google Scholar 

  • Chandrashekar, A., & Schary, P. B. (1999). Toward the virtual supply chain: The convergence of IT and organization. The International Journal of Logistics Management, 10(2), 27–40.

    Article  Google Scholar 

  • Duhigg, C., & Greenhouse, S. (2012, March 29). Electronic giant vowing reforms in china plants. Retrieved from https://www.nytimes.com/2012/03/30/business/apple-supplier-in-china-pledges-changes-in-working-conditions.html.

  • Francisco, K., & Swanson, D. (2018). The supply chain has no clothes: Technology adoption of blockchain for supply chain transparency. Logistics, 2(1), 2.

    Article  Google Scholar 

  • Gefen, D., & Straub, D. W. (2004). Consumer trust in B2C e-Commerce and the importance of social presence: Experiments in e-Products and e-Services. Omega, 32(6), 407–424.

    Article  Google Scholar 

  • Hande, P. V., & Ghosh, D. (2015). A comparative study on factors shaping buying behaviour on B2B and B2C E-commerce platforms in India. EXCEL International Journal of Multidisciplinary Management Studies, 5(3), 1–10.

    Google Scholar 

  • Ho, D. C., Au, K. F., & Newton, E. (2003). The process and consequences of supply chain virtualization. Industrial Management & Data Systems, 103(6), 423–433.

    Article  Google Scholar 

  • Ho, W., Zheng, T., Yildiz, H., & Talluri, S. (2015). Supply chain risk management: A literature review. International Journal of Production Research, 53(16), 5031–5069.

    Article  Google Scholar 

  • Ireland, R. D., & Webb, J. W. (2007). A multi-theoretic perspective on trust and power in strategic supply chains. Journal of Operations Management, 25(2), 482–497.

    Article  Google Scholar 

  • Iansiti, M., & Lakhani, K. R. (2017). The truth about blockchain. Harvard Business Review, 1.

    Google Scholar 

  • Jüttner, U. (2005). Supply chain risk management: Understanding the business requirements from a practitioner perspective. The International Journal of Logistics Management, 16(1), 120–141.

    Article  Google Scholar 

  • Khan, O., & Estay, D. A. S. (2015). Supply chain cyber-resilience: Creating an agenda for future research. Technology Innovation Management Review, 5(4), 6–12.

    Article  Google Scholar 

  • Korpela, K., Hallikas, J., & Dahlberg, T. (2017). Digital supply chain transformation toward blockchain integration. In Proceedings of the 50th Hawaii International Conference on System Sciences.

    Google Scholar 

  • Lamming, R. C., Caldwell, N. D., Harrison, D. A., & Phillips, W. (2001). Transparency in supply relationships: Concept and practice. Journal of Supply Chain Management, 37(3), 4–10.

    Article  Google Scholar 

  • Lu, T., Guo, X., Xu, B., Zhao, L., Peng, Y., & Yang, H. (2013). Next big thing in big data: The security of the ICT supply chain. In 2013 International Conference on Social Computing (SocialCom) (pp. 1066–1073). IEEE.

    Google Scholar 

  • Mason-Jones, R., & Towill, D. R. (1998). Shrinking the supply chain uncertainty cycle. IOM Control, 17–22.

    Google Scholar 

  • Nakamoto, S. (2008, October). Bitcoin: A peer-to-peer electronic cash system. Retrieved from https://bitcoin.org/bitcoin.pdf.

  • Osipkov, I., Vasserman, E., Hopper, N., & Kim, Y. (2007). Combating double-spending using cooperative P2P systems. Retrieved from http://people.cs.ksu.edu/~eyv/papers/ecash-icdcs07.pdf.

  • Samonas, S., & Coss, D. (2014). The CIA strikes back: Redefining confidentiality, integrity and availability in security. Journal of Information System Security, 10(3).

    Google Scholar 

  • Savolainen, T. (2014). Trust-building in e-leadership: A case study of leaders’ challenges and skills in technology-mediated interaction. Journal of Global Business Issues, 8(2), 45.

    Google Scholar 

  • Shepard, W. (2017, December 21). How to avoid dangerous counterfeits on Amazon this holiday season. Retrieved from https://www.forbes.com/sites/wadeshepard/2017/12/13/how-to-protect-your-family-from-dangerous-fakes-on-amazon-this-holiday-season/#75f5ffed7cf1.

  • Skilton, P. F., & Robinson, J. L. (2009). Traceability and normal accident theory: How does supply network complexity influence the traceability of adverse events? Journal of Supply Chain Management, 45(3), 40–53.

    Article  Google Scholar 

  • S. L. (2015, November 02). Who is Satoshi Nakamoto? Retrieved from http://www.economist.com/blogs/economist-explains/2015/11/economist-explains-1.

  • Verdouw, C. N., Wolfert, J., Beulens, A. J. M., & Rialland, A. (2016). Virtualization of food supply chains with the internet of things. Journal of Food Engineering, 176, 128–136.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. The University of North Carolina Greensboro, Greensboro, USA

    Kane J. Smith & Gurpreet Dhillon

Authors
  1. Kane J. Smith
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Gurpreet Dhillon
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Gurpreet Dhillon .

Editor information

Editors and Affiliations

  1. Virginia Commonwealth University, Richmond, VA, USA

    George A. Zsidisin

  2. TU Dortmund University, Fraunhofer Institute for Material Flow and Logistics IML, Dortmund, Germany

    Michael Henke

Rights and permissions

Reprints and permissions

Copyright information

© 2019 Springer Nature Switzerland AG

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Smith, K.J., Dhillon, G. (2019). Supply Chain Virtualization: Facilitating Agent Trust Utilizing Blockchain Technology. In: Zsidisin, G., Henke, M. (eds) Revisiting Supply Chain Risk. Springer Series in Supply Chain Management, vol 7. Springer, Cham. https://doi.org/10.1007/978-3-030-03813-7_18

Download citation

Publish with us

Policies and ethics

Search

Navigation