Axel T. Schulte is Head of Department for “Procurement and Finance in Supply Chain Management” at Fraunhofer IML in Dortmund and an active member of “Blockchain Europe”, the initiative by the NRW government to establish the European Blockchain Institute as anchor and driver for Blockchain activities with a strong focus on Supply Chains.

When it comes to Blockchain, his motto is: Let´s get started, even if we think we are only 90 percent ready. He gives us an insight into the prospects of Blockchain.

What drives you in your day-to-day work with the blockchain technology?

Bringing Blockchain and DLT faster into real life business processes and industrial applications. Pushing use cases and proof of concepts into MVPs and scalable solutions with a clear business impact. Contributing to these goals, in Germany and Europe, using the time window we have for this and not leaving the field completely to others, is what drives me every day – together with my colleagues at Fraunhofer and partners from politics, business, and science,

What challenges and opportunities do you see in digitalization and blockchain?

We are currently experiencing first-hand the negative impacts of dependencies in global supply chains.  At the same time, we are dealing with increasing pressure to make our Supply Chains more sustainable. If we want to reduce dependencies and become more sustainable, we need technology leadership to go digital.

In Europe we have not been successful and fast enough with digital business models in the B2C sector. Large platform providers from other regions are dominating the market and setting the standards. In the B2B sector however, Europe – and especially Germany – still has many opportunities. With our strong machinery, automotive, pharmaceutical, chemical and logistics industries and with the innovative SME sector we are still in a position to achieve digital leadership. But we must take advantage of our window of opportunity before it closes. We must act now.

We should therefore aim for technology leadership in Germany and Europe in the field of blockchain – what does it take to achieve this?

Blockchain and DLT still have to deliver on the `proof of concept’ in many areas. Deployable minimal viable products are still the exception. The time to exploit these opportunities is now. And I am not saying that Blockchain will be the solution to every problem. But we need to overcome the `chicken-and-egg´ situation we are in. For that we cannot wait until all questions regarding legal security and economic viability have been clarified, until all security risks have been investigated and, until all standards have been established. The last 10 percent to perfection will cost us 90 percent of the effort and valuable time. Time, we don’t have if we want technology leadership. If we want to create and apply future digital business models ourselves instead of limiting ourselves to the role of supplier and consumer.

Seems like we need to act now?

We need to get started now, not tomorrow, not next quarter, and not next year. Even if we don’t know the exact outcome or the exact cost-benefit ratio yet. Even if risks remain, and we don’t know whether it will work or which parts ultimately will work.

Our EnterpriseLab partners Commerzbank, Rhenus, Telekom and others are already taking this path, investing into proof of concepts. Also, some of our medium-sized partners such as Piel (technical wholesale), EJOT (automotive & construction) and the Kronhardt brothers (tunnel construction) are developing and testing blockchain-based solutions with us. Further support will be coming with the open-source solutions we develop in `Blockchain Europe´ and in the ‘Silicon Economy´ Initiative – both anchored here at the Fraunhofer IML in Dortmund.