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FedEx Continues Plans to use Blockchain for Streamlined Logistics

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FedEx, a global leader in logistics, will implement blockchain technology to increase transparency and data security to logistic processes.

“We definitely believe that blockchain represents a significant opportunity in the custodial control and chain of control for supply chain shipments,” said Robert Carter, Chief Information Officer of FedEx, at the FedEx’s 2nd Quarter 2018 Earnings Call.

“We believe that going forward, the overall prominence of goods as they move around the world and the enhancement blockchain offers to global settlement systems and payment systems, offers a significant opportunity for us.”

The company’s desire to leverage blockchain technology comes after the high profile cyber attack on its TNT Express branch in Europe in 2016. As the parent company, FedEx has taken active steps to improve their existing systems by partnering with Blockchain in Transport Alliance (BiTA).

“We have been at the cutting edge for decades, and at this point, we think blockchain is a fantastic technology coming along, and we certainly want to play in this space,” said Dale Chrystie, Vice president & strategic planning & analysis at FedEx Freight.

Innovation in logistics at FedEx

FedEx quickly jumped on the opportunity to leverage blockchain technology after seeing companies like Maersk Line, the world’s largest container shipping company, apply blockchain technology to their supply chains.

“FedEx has a long history of innovation in the logistics space since the beginning,” said Kevin Humphries, senior vice president of IT at FedEx Services. “One of our focuses has always been to find innovative ways to provide the kind of visibility that our customers need to get all the information up and down the supply chain. And blockchain is opening the door to that by giving customers even more visibility to their package before it gets in our hands and after it leaves our hands.”

FedEx has therefore partnered with BiTA to collaborate with companies in the logistics industry. According to an interview with FreightWaves, a news organization on Cargo shipping, FedEx is “proud to be a founding member of BiTA and the BiTA standard board, because we want to work on developing common standards around blockchain technology in the transportation industry,” said Chrystie.

BiTA’s goal is to standardize blockchain principles for future applications in the logistics industry. It currently has over 40 companies including UPS, P&S Transportation, US Express, SAP Bridgestone and Strive Logistics.

Blockchain pilot programs

Alongside FedEx’s partnership, FedEx is currently implementing new blockchain pilot programs. Humphries believes that the pilot programs will help the company grow its knowledge and implementation capabilities concerning blockchain technology. The testing phase will also assist with scalability and performance characteristics.

“Our early work is in dispute resolution, where we have customers both upstream and downstream from us, trying to speak back in a common language,” said Chrystie. “We are trying to determine if that data is common and in some cases, we as carriers, don’t necessarily have all the data that we would like to have. If we could agree on these elements and standards, we think we can drive a lot of efficiency in the process, and that’s just one example.”

Although FedEx has only recently explored blockchain technology, the company is ”hopeful that blockchain will have many use cases,” said Humphries.

 

Image credit: FedEx

 

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