Determination of Cost Benefits from Implementing a Blockchain Solution
ARP6984
This SAE Aerospace Recommended Practice (ARP) provides insights on how to perform a Cost Benefit Analysis (CBA) to determine the Return on Investment (ROI) that would result from implementing a blockchain solution to a new or an existing business process. The word “blockchain” refers to a method of documenting when data transactions occur using a distributed ledger with desired immutable qualities. The scope of the current document is on enterprise blockchain which gives the benefit of standardized cryptography, legal enforceability and regulatory compliance. The document analyzes the complexity involved with this technology, lists some of the different approaches that can be used for conducting a CBA, and differentiates its analysis depending on whether the application uses a public or a private distributed network. This document is intended for people who do not have a deep technical understanding or familiarity with blockchain solutions to qualify and quantify its economic benefits (i.e., the value proposition).
Rationale:
The aerospace industry is rapidly digitalizing processes across its asset life cycle stages including most transactions, and with this are emerging novel ways of recording these electronic transactions. One such technology for recording electronic transactions securely is Blockchain, defined as distributed ledger technologies which includes enterprise blockchain, not having a wider use in the aerospace industry because of the lack of technical understanding as well as questions about its benefits. Assessing these benefits relative to the investments needed to implement such a blockchain solution is difficult, contributing to the slow adoption rate. The aerospace industry is conservative in its approach to technology adoption and hence it is difficult to change legacy processes. Additionally, the industry is very fragmented, technology is advancing at a faster rate and applies to a wide geographical range under different regulatory oversight that makes implementation challenging. This recommended practice lays out a methodology for qualifying and quantifying the benefits of replacing or augmenting a legacy process with a blockchain solution.
Related Topics:
Unmanned aerial vehicles
Artificial intelligence (AI)
Cost analysis
Supply chain management
Manufacturing systems
Cybersecurity
Data exchange
Cryptography
Real-time data
Computer privacy
Also known as: SAE ARP 6984
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