One of the "Big Four" accounting organizations Deloitte has recently published a 50-pages global survey about utilizing the blockchain technology, the link on the initial document is at the end of this article. We’ve reviewed the report and want to share with you some key points.
The survey took place in March/April 2018 among top managers of companies with a turnover of more than $500 million. Researchers interviewed 1000 C-level executives from seven countries, most of them are responsible for IT, sales, finances, a strategy of innovations in their organizations. Two-thirds of respondents work in finances, IT, consumer products and medicine.
The report is divided into two parts: the research data and the Deloitte specialists’ opinion about the current situation, the position of the blockchain and its outlook. Predictions in the report are surprisingly optimistic; we expected a more cautious and even skeptical position from one of the "Big Four" companies. The authors talk about the blockchain enthusiastically and predict stunning prospectives for the technology. Evidently, they formed this opinion as a result of the survey: 59% of respondents think the blockchain can revolutionize their industries and the whole economy. And of course, the authors couldn’t avoid to traditionally compare the growth of the blockchain technology with the Internet of the mid-90s.
It’s not the first Deloitte’s survey, and the previous one took place in 2016. Authors noticed that for two years the focus has shifted from the academic study of the blockchain technology to its practical use in business cases.
Besides, it turned out that the blockchain growth prognosis of 2016 has not come true: the technology didn’t grow as fast as the researchers expected. The reason may be in the respondents' selection: there is no information in the report, but by all indications, the authors talked to those top managers who are interested in the blockchain and as a result, do not represent an average position concerning the technology.
Here’re the survey’s key points.
- The authors point out that “respondents are extremely bullish on blockchain’s potential, namely its ability to broadly scale and reach mainstream adoption.” 69% of them are planning to replace current systems of record (e.g., financial ledgers, CRM and ERP modules, inventory tracking systems, etc.) with blockchain.
- 39% believe blockchain is overhyped. Apparently, the remaining 600 managers either missed the hype around the growth of the bitcoin, ICO and cryptocurrency or separate blockchain as technology from processes on the crypto market which is reasonable.
- More than one-third of respondents started implementing the blockchain, and 41% are planning to apply it next year. 78% think that they may lose competitive advantages if neglect the blockchain. At the same time, one-third of respondents suppose that the benefit from the technology is questionable.
- 32% of respondents tend to cite greater speed as major advantages of blockchain technology, 28% - the possibility to implement new business models, 21% talk about safety and 16% point on lower costs.
It’s a controversial point as it disagrees with the statement made by most of the respondents where they describe the blockchain as a breakthrough technology supposed to disrupt their industries. Should the transaction speed or lower costs disrupt the industry? Doubtedly. What actually can revolutionize current business-models is new ways of interaction for suppliers, mediators, and consumers, but this considerably underrated.
- What interferes with implementing the blockchain: regulatory issues (39%), adapting to legacy system (37%), potential security threats (35%), uncertain ROI (33%), lack of in-house skills/understanding (28%).
Naturally, most of the impediments will vanish sooner or later. Then enterprise organizations which have a waiting attitude, for now, will be able to implement the blockchain in several years with less risk but at the same time without the advantage of pioneers.
- Another interesting question in the survey was: Which blockchain model are you focusing your activities on? Answers: permissioned blockchain (52%), private blockchain (internal to your company) (44%), public blockchain (44%), consortium (36%). (Percentages equal more than 100 percent because respondents were allowed to submit more than one answer.)
- The most intriguing is the fact that almost half of respondents are focusing on public blockchains like Bitcoin or Ethereum while the news published by big companies usually show the interest to private or consortium blockchain.
- The question about investment in hiring staff with blockchain experience is interested for us as blockchain developers. Only 24% of American enterprise companies are investing in new team members that possess blockchain knowledge and expertise, whereas in Europe this number is almost 50%, in China - 86%.
- Most of the C-level executives describe their level of understanding of blockchain as “excellent” or “expert.” For instance, in the oil and gas industry, there are 87% of such execs, in financial services - 73%. However, the next question shows the level of such “expertise.” Almost half of them (in the oil and gas and automotive industries more, in finances and medicine less) believe that the blockchain is solely a database for money and an application for financial services.
The survey has shown that the execs of big enterprise companies take the blockchain seriously and consider the technology as an essential part of their strategic development. The feeling that the blockchain is a privilege for enthusiasts and startups will decline in the nearest years as slower but far bigger companies will implement the technology.
Written by AXIOMA CFO&Co-Founder, Konstantin Rukin
Deloitte’s 2018 global blockchain survey: https://www2.deloitte.com/uk/en/pages/innovation/articles/global-blockchain-survey-2018.html#