By Alexandra Lilienthal
Blockchain, which first came to prominence managing cryptocurrency transactions, has quickly shown its ability to provide an inexpensive and efficient way for enterprises and government to share information securely between private and public networks.
Blockchain is basically a digital ledger of any transactions or data that need to be independently authorized and verified. The big difference is that blockchain cuts out the trusted third party by storing the ledger across a group of computers, instead of in one place. This provides unequaled transparency.
The technology’s alternative approach to sharing and storing information adds to its secure nature. The list of records, known as blocks, are chained together and secured using cryptography. The blockchain ledger is updated so everyone can see it at the same time. It can be added to, but can’t be erased, which makes it tamper proof.
Blockchain is set to change the way enterprises and government carry out trusted transactions. Government agencies are already exploring ways that blockchain could be used to support trust and transparency, while reducing costs. Sweden’s land registry has been piloting blockchain technology as a means of carrying out property transactions. It has been looking at how buyers, sellers, banks and other stakeholders could track a transaction from start to finish using blockchain instead of paper contracts, thus making tracking and transparency easier while accelerating the process.
The Blockchain/ECM Puzzle
The big question is how far can blockchain be used in document management and how will it disrupt the world of enterprise content management (ECM)? By putting blockchain and ECM under the microscope there are some key differences.
Let us take traceability and the variance of anonymity. An ECM system is grounded on traceability and the necessity for creating audit trails to comply with corporate and legislative rules. Traceability in blockchain, however, has a very different definition. Although each saved block transaction is totally trackable, it can’t actually be attributed to a single person.
In addition, public blockchains don’t allow blocks to be deleted or modified in any way. A tiny edit such as adding a period mark to content held in the blockchain necessitates that the entire peer-to-peer network approve the process.
We also have the issue of data security in stark contrast to public data accessibility. The large distributed network of users that make up the verification process is what emphasizes blockchain’s value as an open, public, peer-to-peer verification tool. But this locks horns with an enterprise’s desire to hold sensitive data internally to protect it against cybercriminals and leakage.
The very idea that enterprises might choose to embrace blockchain content management may seem quite extreme, given that most enterprises still choose to run their ECM on premises as opposed to in the cloud. In the future, private blockchain may be the answer, via a permissioned network.
There is also the matter of central administration as an alternative to distributed ledgers. When deploying an ECM system, data sovereignty, security, and compliance are all key. These usually run in conjunction with enterprise policies and regulatory requirements that require user and data management administration to be centralized.
Blockchains, however, come via a very different way of thinking. They use automated distributed ledgers for the validation and confirmation of transactions. The concept of user management as enterprises understand it is impossible with blockchains as they can’t be linked to user profiles.
Finally, we have scalability. This is key to many of today’s business models as it enables enterprises to scale up and down to easily respond to variations in the market. Many assume blockchain fits neatly into this elastic approach. However, unfortunately blockchains just don’t scale that easily. Blockchain has one inherent characteristic—decentralization, which doesn’t lend itself to scalability. In contrast, ECM systems are flexible and allow for quick and easy scalability. In addition, confirmation is also available in real time when content is filed, uploaded or deleted.
Over the Horizon
The technology is still it is early days. We must remember that even if enterprise ECM users wanted to shift their document management across to blockchain it would be impossible right now. The technology just doesn’t have the capacity and it still only works on transactions of representations.
However, a relationship between blockchain and ECM could be a very fruitful in the future. A blockchain-enriched content management platform could increase the creation and use of smart contracts and automated processes, for example. With this in mind we should be looking to integrate blockchain into ECM, not dismissing it as mere hype. SW
Based in Berlin, Alexandra Lilienthal heads the international communication team of global ECM vendor SER Group. Reach Lilenthal at Alexandra.Lilienthal@ser.de.