Balint penzes crop
But cryptocurrency is just one way of using this technology. Blockchain has the potential to fundamentally transform our industry.
With capital infrastructure projects around the world relying on a scattered and complex supply chain, we have an ongoing challenge to improve productivity and accountability. Blockchain technology could help to achieve greater transparency, traceability and collaboration.
In a nutshell, blockchain is a database of information, with special properties, which is stored across a network of computers and accessible to a community of users. It is decentralised, with no one party holding overall control of the data. The distributed information is simultaneously updated, recorded chronologically, and cryptographically secured. Once published, it cannot be changed. In this way, it offers an immutable record of any transactions, agreements and interactions.
The technology’s potential can be seen most clearly in payment and project management. A wide range of business processes and administrative tasks could be improved, automatised and made more efficient, resulting in better project control and significant cost savings.
A blockchain-based smart contract can initiate payments automatically, based on digitally approved work. It could help to solve the long-standing industry issue of late payments and cash flow problems. As a result, the industry could move towards more transparent, fairer practice and overall become a more trusted entity.
Blockchain can also deliver a more streamlined procurement process, ensuring the provenance of structural materials and creating a verified chain of custody. This will help to reduce waste and improve sustainability, as well as drive up the quality of products and services.
If a digitised, undisputable and transparent blockchain-enabled operation model is linked with information and data-rich building information modelling implementation, the combination would create a trusted digital twin for assets. Creating the ultimate single source of truth for all aspects of a construction project, it would support the design, construction, operation and maintenance stages along the whole lifecycle.
We are still at an early stage on the blockchain journey and there is a need for further collaborative industry research. We need to frame and facilitate pilot projects and best practices to be able to leverage the full potential of this emerging technology. Construction is one of the largest industries in the world and infrastructure is the backbone of economic growth and productivity. If blockchain could reshape the industry dramatically for the better, the opportunity is simply too great to miss.
- Balint Penzes is a consultant engineer at Cowi UK and author of the recent ICE report Blockchain technology in the construction industry