Dive Brief:

• Auburn University's RFID Lab is teaming up with 21 partners ranging from overseas manufacturers to U.S. retailers in a blockchain pilot, the Chain Integration Pilot (CHIP). The lab will share serialized inventory data collected by RFID scanners among all levels of the supply chain, according to Justin Patton, the director of the RFID lab at Auburn. Partners include companies like Under Armour, Spanx and Herman Kay, but many were not made public.
• "The problem we've had for the last 15 years is we've had no reliable way to send that data from partner to partner because all it takes is one vendor in the supply chain to corrupt or lose that data and the whole thing falls apart," Patton said in an interview with Supply Chain Dive. In this pilot, Patton seeks to determine if blockchain can improve claims compliance, along with anti-counterfeiting and product authentication.
• Work on the project began last summer, and the last 11 months has involved educating the partners on data standardization and pairing up partners so retailers are working with manufacturers whose items they already sell. The network will be built on Hyperledger technology, which is an open-source blockchain technology maintained by the Lynx Foundation. "We just got the test network up," Patton said. "We're starting to load the data in now." 

Dive Insight:

The lab's work in data standardization over the last few months has been especially important to the pilot. In past projects, Patton said he's worked with a dozen partners, and when he asked for their inventory data, it was provided in a dozen different formats. For a system like this to function, all of the partners need to be collecting the same information in the same format, he said.

The partners will keep their legacy systems in place during the pilot, but the test network will run on real business data, Patton said.

"It will work in parallel," he explained. "I don't think anybody is going to adopt this into their core business functions until we prove the feasibility, which is the whole purpose of doing this feasibility test." 

Part of this early work will be figuring out the best way to connect a partner's data to the blockchain whether through APIs or other means, he said.

He anticipates reconvening with partners in December with early lessons learned from the beginning stages of the pilot to make changes before more widespread use.

"This pilot network is not designed to grow organically into a larger system. What we're doing is learning enough from this pilot network so that people can go back and implement a full network that would be better for everyone I think," Patton said.

There are other ongoing blockchain projects looking to connect every level of the supply chain, including efforts by Ford and IBM to track cobalt from the mine to the final buyer. (IBM is also a CHIP partner.)

While many in the supply chain profession have voiced support for blockchain technology, there are signs early pilots are struggling. An analyst from Gartner recently said pilots are struggling because "of technology immaturity, lack of standards, overly ambitious scope and a misunderstanding of how blockchain could, or should, actually help the supply chain."

Even as Gartner urged caution on these efforts, analysts underscored this doesn't mean companies should stay away from it completely. The technology has to mature somehow, and efforts like CHIP could play a role in making that happen.