The implementation of the Blockchain technology in Real Estate and Facilities Management especially, in supply chain management, will improve the competitive advantage of the built environment professionals and help populate the lacking Environmental Product Data (EPD) – a platform that will provide adequate data for informed decision making for any organization in its procurement process.
Blockchain - The record-keeping technology.
At its most basic level, the blockchain technology is just a chain of blocks.
The words “block” and “chain” in this context, refers to digital information (the “block”) stored in a public database (the “chain”).
The “Blocks” in the blockchain are inclusive of digital pieces of information. Specifically, consisting of three parts:
- Information about the transaction i.e. date, time, and amount of your purchase.
- Information about the participants in the transaction i.e. name, username, etc.
- Unique code called a “hash” used to distinguish every transaction from the other.
According to the Ellen McArthur Foundation, a circular economy aims to redefine growth, focusing on positive society-wide benefits. It entails the gradual decoupling of economic activities from the consumption of finite resources, to designing waste out of the system. Underpinned by a transition to renewable energy sources, the circular model builds economic, natural, and social capital. It is based on three principles:
- Design out waste and pollution
- Keep products and materials in use
- Regenerate natural systems
A circular economy is an economic system, aimed at minimizing waste and making the most of resources. In a circular economic system; waste emission, and energy leakages are minimized by slowing, closing, and narrowing energy and material loops; this can be achieved through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and recycling (wikipedia.com).
New Business models – The Circular economy, the blockchain can support…
With the implementation of the blockchain technology, the built environment professionals will be equipped with new skill offerings, critical to the needs of the customers take for instance; the FM, in a systemic move to minimize leakages and negative externalities, and the need to provide superior value will be able to achieve the following:
- Reduce and Re-use Systemic Wastes i.e. Energy waste, Computer waste, etc. Blockchain’s implementation will mean the FM’s ability to use, re-use all systemic wastes to the advantage of the customer. First, the FM will adequately be able to easily identify where systemic wastes arise and how to arrest them and recycle them where and when necessary.
- Improve the Construction process and output – improved value offerings i.e. tagging and mapping; fixed asset management and identification, etc.
For the Facility Manager, minimizing leakages and negative externalities is at the core of the profession. The FM would clamor the ability and flexibility that comes with implementing the blockchain technology in Supply Chain Management – being able to not only track consumables (and the providence associated with it) but also every solution that is a transaction.
The Manufacturer, Service Provider, and the customer can all be captured in a block of the transaction(s) having a unique identifier and is publicly hosted (which means, it is accessible by all concerned).
A digital log consisting of the assets and the associated transactions (encrypted) will form a list of records (blocks) that gives added capabilities to the Facilities Manager. She/he can track the assets, adequately monitor performance, easily identify and locate assets, use and re-use assets, recall defective products, etc.
For the Facilities Manager, the adoption of Blockchain technology in supply chain management will have the ability to achieve the following:
- Keeping an Audit trail – Assurance
- Maintain smart contracts
- Ensure transparency
- Peer to peer (distributed) transactional replication
- Parallel Visibility for all parties involved.