Sky Republic’s Perspective on Blockchain

Since the 80s, B2B ecosystems transact using Electronic Data Interchange (EDI) standards which exist in most industries. EDI provides message formats for business partners to interoperate and automate transactions one-to-one. Other one-to-one technologies such as file transfer, email or even fax are often used to overcome EDI limitations such as the exchange of unstructured documents (pdf, etc.) or avoid its significant total cost of ownership. APIs have also recently emerged as a convenient way to transact from Cloud, Mobile and Social apps.

EDI is a stable system with a developed support network – in fact, EDI systems and transaction volumes continue to grow. According to a recent study by Forrester, the annual volume of global EDI transactions exceeds 20 billion per year and is still growing.

However, EDI or even API are inefficient to solve recurrent challenges when assets are exchanged across an entire network of partners. In supply chain for example, more than 20 intermediaries can have custody of a shipment door to door. Today, 66% of companies do not have full visibility on their supply chain. Lack of end to end visibility opens doors to theft, fraud and counterfeiting. More than 40% of companies experience at least one disruption a year with a minimum cost of $1M excluding brand damage. EDI can’t help detecting or mitigating these disruptions. Neither can it leverage digital remedies such as IoT, Mobile or Artificial Intelligence.

Parallel communication channels and messaging in cascade desynchronize partners’ systems of record which create delays, errors and business frictions. In Supply chain, invoicing error rates per company range from 2% to 30% for example. With no consensus on a single version of the truth, B2B ecosystems endure costly manual reconciliations,painto pass audits and to produce compliance reporting.

A growing number of CIOs and enterprise architects are looking at blockchain technologies to upgrade their B2B infrastructure and stay competitive in a modern world driven by the digital experience.

It’s important to note that even if all blockchain platforms create N-to-N consensus by distributing a ledger of processed transactions, they aren’t alike, however. Businesses have already changed focus from cryptocurrencies or public blockchains, like Bitcoin or Ethereum, to enterprise or permissioned blockchains.

An enterprise blockchain (aka distributed ledger technology) is engineered to provide performance, confidentiality and legal enforceability. Key distinctions exist also among enterprise blockchain platforms which are basically of two kinds. Some automate distributed workflows like R3 Corda. Others focus on distributing a system of records in a database like Hyperledger Fabric.

We think that B2B ecosystems simply need both capabilities, distributed workflows and distributed database, in the same technology in order to interoperate in full consensus at all times. The biggest software vendors owning very profitable B2B messaging technologies won’t take this approach and just add a distributed system of records in their catalog, creating more integration opportunities for themselves and more pain for their customers. Note that we avoid the term “shared” and use “distributed” as no enterprise would delegate the control of its transactional systems or the management of its records. Before engaging assets or liability, and even if partners are trusted, an enterprise collects a copy of all necessary records and verifies them.

We built Atlas, our platform, from the ground up with the most demanding B2B ecosystems in mind and the conviction that distributing code is a pragmatic way to reach consensus but also solve interoperability challenges and further standardize industry processes. All B2B process modeling standards like ebXml, RosettaNet or BPMN failed to be adopted by introducing too much complexity.

First, we created the Sky Contract which takes the concept of smart contracts to another level. Distributed on a network of nodes and synchronized through a dedicated and permissioned event-driven blockchain, a Sky Contract automates the complex and dynamic workflows at stake within B2B ecosystems. It processes and distributes business events and related records on the fly to the appropriate entities considering their business relationships and visibility rights. Each copy in the network uses a relational database to support real life data models and simplify implementations. Each party of a Sky Contract runs a copy of it to maintain consensus with the others and automatically verify the records provided by its ledger. This verification goes beyond the validity of digital signatures and encompass the entire business logic coded in the Sky Contract itself regarding SLAs, assets state, documents availability, compliance and more.

Second, we created the concept of Sky Apps to power the private business logic of a party and integrate it with its back-end applications. Sky Apps can be packaged and downloaded like Sky Contracts to reduce onboarding time and ensure interoperability.

Third, we engineered the Atlas node as a centralized hub as easy and cost-effective to run than an EDI or API gateway. It delivers premium performance through parallel processing and pipelining of transactions, scalability, high availability and built-in disaster recovery. These capabilities shape the foundation of an architecture and cannot be added as evolutions. Atlas node is available in public, private Cloud or on premise.

Finally, we designed Atlas consensus mechanism to deliver trust, transparency and automation, including interoperability with other blockchain platforms, to centralized and distributed ecosystems. They are the only models used today and viable for business. It means that you can leverage network consensus whether you are transacting through a Community Network/VAN or directly with your partners. Atlas membership and administration services adapt to the chosen business model.

In conclusion, Sky Republic Atlas is uniquely engineered to maintain consensus within large B2B ecosystems and power mission-critical solutions. It can:

•  Automate and simplify ecosystem choreography

•  Distribute business events and records in real time

•  Manage document exchanges

•  Integrate Digital 2.0 (API, IoT, Mobile, Artificial Intelligence)

It’s designed to provide ROI compared to open sources during design and run phases. It reduces development efforts with easy to use software development kits and a growing library of connectors. It reduces operational costs by minimizing cloud resources consumption and simplifying governance thanks to its hub architecture.

We invite you to learn more about how Atlas can create, replace or augment your B2B infrastructure.

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