Blockchain to replace ERP System in the future? Possible or nay?

[jhean_arcane]

As we all know, blockchain offers a decentralized and secured environment for storing and managing data. Plus, it offers transparency.

ERP on the other hand, is a centralized way to manage and control the internal business processes as mediated by a software.

But with the advent of blockchain, many people are trying to make solutions to improve blockchain.

Blockchains and ERP are like apple vs orange. Both are the same fruit, but they are essentially different from each other. However, many are trying to make the apple an orange, if you know what I mean.

Blockchain may not be seen as replacing ERP system now. There are things that needs to be solved before it happens, though: Scalability, ability to forecast, etc. There is one thing that blockchain is resistant to, which is essential to ERP: modification. Modification is needed on ERP to suit business needs, and in blockchain, this is impossible.

Naturally, the conclusion is this, blockchain cannot replace ERP, but rather it can supplement it to add trustworthiness of the system.

However, I want to challenge this. I am one of those people who wanted to see apple become an orange. I'm not asking for a miracle, though. I am asking for evolution of blockchain without compromising it's core characteristics: transparency and decentralization.

But now, what kind of blockchain evolution do people want?

[xdrpx]

Most ERP systems today make use of an RDBMS database (few of them don't) and these systems are capable of handling transactional information (For example inventory maintenance transactions, Material requisitions and processing, Financial - AP / A/R, journals and Sales orders as well as purchase orders). I'm also aware of many businesses who prefer to utilize information from the ERP system to process them through BI tools like Business Objects, QlikView and probably many others. These systems require a database that can store transactional information created on the go and on a real time basis. This becomes importantly mainly because most of the sales orders house sales margin information and inventory tracking (maintaining minimum / reserve stocks) and these have to be updated in many businesses on a real-time basis. Blockchain technology certainly hasn't reached this level of information processing capabilities on a real-time basis. Even with a private blockchain technology like Hyperledger there's' usually information that needs to go into a block which has to be validated and added into the block after one has been made (there's no mining in such case).

Blockchain technology would be useful alongside ERP systems to add "Trust" and to validate inventory movements and adjustments, stock status and very useful for inventory counting. This proves helpful for supply chain management as well to ensure that goods have been delivered by suppliers in right quantties and at the right time without having to worry about middle-men to verify this information and who could possibly maniupalte it.

[Slava79]

At first sight it could be thought that ERP or corporate intranet doesn't pass "can it be built without blockchain ?" test. But it turns out things are not that simple.

Recently a had a conversation about how complex and competitive corporate environment can be - there are sides, "wolfpacks" of managers in different branches, constant need for real and provable set of data, not curved in prism of someone's preferences etc.

I think blockchains place in big C is there, just not found yet (ERP, corporative resources registry, decision making?)

[Laloo1123]

As the blockchain continues to mature and find adoption in areas other than cryptocurrency, ERP vendors are working to integrate the distributed ledger technology as a track able, immutable record for everything from shipping manifests and supply chains to equipment maintenance and dispute-resolution systems.
"This is very real and something we're aggressively excited about," said Brigid McDermott, vice president of Blockchain Business Development at IBM. "What blockchain does is provide a trust system of record between disparate companies."
The value achieved through integrating block chain with ERP systems comes not by creating and porting new information into the distributed ledger, but by drawing existing data from enterprise systems and being able to tightly control with whom it is shared.
Eighty percent of the world's corporate data resides in silos, according to McDermott. While the promise of big data has always been the ability to glean greater insights, owners of that information keep it close to their collective chests, concerned that once it's released, they'll lose a competitive advantage.

[RajaAli]

Blockchain cannot replace ERP systems, because companies can not show or share data with anyone. Blockchain work on transparency but companies cannot.

[Slava79]

Blockchain cannot replace ERP systems, because companies can not show or share data with anyone. Blockchain work on transparency but companies cannot.

Blockchain can be shared between companies or branches of the same company. Also, the data can be protected using blind signatures schema, so that validators (if we talk PoS)  or someone else can't really know what they are signing, but can prove it's correct data.

[jhean_arcane]

Most ERP systems today make use of an RDBMS database (few of them don't) and these systems are capable of handling transactional information (For example inventory maintenance transactions, Material requisitions and processing, Financial - AP / A/R, journals and Sales orders as well as purchase orders). I'm also aware of many businesses who prefer to utilize information from the ERP system to process them through BI tools like Business Objects, QlikView and probably many others. These systems require a database that can store transactional information created on the go and on a real time basis. This becomes importantly mainly because most of the sales orders house sales margin information and inventory tracking (maintaining minimum / reserve stocks) and these have to be updated in many businesses on a real-time basis. Blockchain technology certainly hasn't reached this level of information processing capabilities on a real-time basis. Even with a private blockchain technology like Hyperledger there's' usually information that needs to go into a block which has to be validated and added into the block after one has been made (there's no mining in such case).

Blockchain technology would be useful alongside ERP systems to add "Trust" and to validate inventory movements and adjustments, stock status and very useful for inventory counting. This proves helpful for supply chain management as well to ensure that goods have been delivered by suppliers in right quantties and at the right time without having to worry about middle-men to verify this information and who could possibly maniupalte it.

Thanks for your input! I did not realize how complicated ERP is, although I am confident that as blockchain develops, many improvements are made so that it can function like this system. Maybe in 10 to 20 years we can see the maturity of blockchain? No one knows. But your input gives me more hope that our technology is geared towards a more formidable level where everyone is accountable to each other. You made me realize something! Information is indeed important, but "Trust" is now becoming an essential part of yielding profit. Pretty soon, those who holds the most Trust from the public gets more monetary returns.

[Kogs]

Naturally, the conclusion is this, blockchain cannot replace ERP, but rather it can supplement it to add trustworthiness of the system.

I would not replace a complete ERP (or any other) system with a blockchain version of it. 99% of the functionality would not fit to the abilities of blockchains.

But I can think of a relative simple way to achieve "trust" in any system where data should not be allowed to be changed.

• The ERP or whatever system stays like it is (using RDBMS as data storage for example)
• It need to be defined which data need to be immutable (not all data inside such big systems need to be immutable, so not necessary to track it for everything)
• Each data record which should be immutable will get hashed (included a timestamp) automatically by a new function within the ERP system when such a record get saved
• The generated hash will be stored in any public blockchain
• From that point on a controlling instance can verify that every saved record in the system do have a hash and that the hash is also saved in a separate blockchain (with timestamp) and that those two hashes matches.
• If someone try to change any data in the ERP system, this would generate a new hash which is not available in the blockchain

With this method you could prove that every recorded transaction in the ERP system was never changed after creation.

I'm quite sure there are some flaws within this simple idea which need to be looked at, but from the basic concept it would work.

[ganlianshifu1]

Block chain, artificial intelligence technology in the future will replace ERP system this is certain!

Now that the market environment has changed, business needs have changed. The ERP system will also disappear gradually!

[nicosey]

An accounting ledger replace ERP?

[lnihjlbg]

I think the Blockchain is a new technology that change the ERP system,
it would made the transparency add in the ERP.
and it would not change by anyone,
it's good for the manager to manage their company.

[laraveldeveloper]

Scope of blockchain only for transactions. We can not implement block with data who has lots of relations. Blockchain have single relation with in blocks without any edit  scope into the blocks. So its not  possible integrate companies huge data into block chain. RDBMS is good for ERP system.

[onRIVer]

You can not compare ERP and blockchain. They are absolutly different entities. For example, ERP can use data from blockchain.