Blockchains & Ecosystem ApplicationsThe Future of Process Management

Casey KuhlmanCEO, Monax

Before there was process automation there were just processes

Then smart people invented computers to automate drudgery

Computers + Business Processes => 1st Generation of Process Automation

Processes + SME’s => 2nd Generation of Process Automation

Interest in Blockchains => 3rd Generation of Process Automation

Labor Costs of processesBefore automation

Organization

Supplier

Services Provider Customer

Regulator

Supplier

Organization

Services Provider

Regulator

Customer

The Costs Are At the Edges (the Interfaces)

Labor Costs of processesAFTER Generation 1&2

Supplier

Organization

Services Provider

Regulator

Customer

Coordination + Reconciliation Efforts

Labor Costs of processesAFTER Generation 1&2

Data Redundancies

Ecosystem Applications allow moving costs and complexity from the edges ...

Producer

Financial Services

Risk Services

Wholesaler

After MktIOT

Sensors

TransporterRetailer

… to a shared blockchain infrastructure that automates processes at a value chain level

Producer

Financial Services

Risk Services

After MktIOT

Sensors

Wholesaler

TransporterRetailer

Title Transfer

RulesTitle Registry

Payments Rules

Possession Transfer

Rules

What are Ecosystem Applications?

Applications that run on an ecosystem (or, network) level

Events Processing Content Messages

Traditional Apps Database Ecosystem Apps Blockchains

Traditional Apps Programs

Ecosystem Apps Smart Contracts

Traditional Apps File Systems

Ecosystem Apps Data Lakes

Traditional Apps API Calls

Ecosystem Apps Point-to-Point Messaging

Blockchains => an immutable record of attributable actions visible to every node on the network; or, every participant in the ecosystem.

Smart contracts => programs which provide deterministic computation and verified outcomes by every participant in the ecosystem.

Blockchains and smart contracts in 30 seconds.

● Distributed, immutable ledger○ Data certainty○ Real-time reconciliation

● Cryptographically verified activity○ Continuous, self-managing audits for all events

● Ability to execute cryptographically secure logic○ Smart Contracts -> process certainty

What can blockchains do?

● Get queried (they’re ledgers, not databases)○ Lots of workarounds though.○ Many startups working to solve this.

● Provide Me-to-You Privacy○ Blockchains are transparency machines.○ There are workarounds.○ Typically better to use a strengthened p2p messaging layer instead.

What can blockchains not do (currently)?

● Blockchain architecture provides cryptographic data certainty as to who took what action and when

○ Example: Bag A was checked in by Passenger Z

● Smart contracts provide cryptographically secure computation and logic verified by all ecosystem participants

○ Example: Did the Drone properly register to be in this airspace at this time?

● Open source systems have more potential for global network interoperability○ Lower Cost○ Global Availability

Why are blockchain & smart contracts important?

Ecosystem Applications v. Traditional Applications

Assumed to be operated by a single company

Infrastructure Assumed to be operated by many companies

Password-based logins (typically)Authentication Public-private cryptographic keys

RecordsData Focus Events

Traditional Applications Ecosystem Applications

What Ecosystem Applications are Being Built?

Industrial Applications

Insurance Real-time policy coverage AI enabled risk securitization

Energy IoT enabled supply chain tracking Smart grids

Banking Debt origination & servicing Trade finance

Governance Applications

International Aid Grant management Administration of public benefits Public goods Airspace auctioning Clinical research/open science

Open Data Publications transparency Budget transparency

New Applications

Transparent data-driven relationships Distributed employment/micro tasking Community based lending mechanisms

Scalable data-driven relationships Information age guilds Distributed companies

Single source of truth P2P on-demand platforms Education certification schemes

Risk Services

Aviation Authorities

Drone Manufact

Airports

Drone Operators

Drone RegistryAirspace

Rules

Drones Registry Ecosystem Application

Flight PlanRules

Ground Handling

Companies

Financial Services

Risk Services

IOT Sensors

Airports Airlines

Baggage Registry

Payments Rules

Possession Transfer

Rules

Baggage Tracking Ecosystem Application

Producer

Financial Services

Risk Services

IOT Sensors

Distributer

TransporterAirlines

Title Transfer

RulesParts Registry

Payments Rules

Possession Transfer

Rules

Airplane Spare Parts Ecosystem Application

Current market conditions require high coordination costs for enterprises

Increasingly Inter-Connected

Highly Regulated

Nimble Competitors

More humans at the edges increasing costs

Compliance costs rising

Defend old lines of business or transform

Business Environment... Business Challenge...

Process assurancesacross organizations

Data assurancesacross organizations

New opportunities to create value

Business Need...

Ecosystem applications reduce coordination costs

Smart contracts provide process assurance

across organizations

Blockchains provide data assurance across organizations

Ecosystem Applicationsprovide mechanisms for collaborative creation

Business Need... Technical Promise...

15% of banks planning to have production

deployments by 2017

In capital markets alone deployments could save up

to $20 billion a year

Complete transformation of numerous industries such as the $6-8 trillion global

trade finance market

Business Result...

Process assurancesacross organizations

Data assurancesacross organizations

New opportunities to create value

Where were the Enterprise Keystone Species in 2014?

Heard Tell Of

Exploring the Terraintypically competitors as

peers focussed

Digging Burrowsfinding business value

in ecosystem approaches

Thrivingdelivering value to their

ecosystem

CIBs RetailBanks

Where are the Enterprise Keystone Species in 2016?

Heard Tell Of

Exploring the Terraintypically competitors as

peers focussed

Digging Burrowsfinding business value

in ecosystem approaches

Thrivingdelivering value to their

ecosystem

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airlines Retail Health

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Health

CIBs ReInsurance

Energy

Where are the Enterprise Keystone Species in 2018?

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airline Retail Health

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airlines Retail Health

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Health

CIBs ReInsurance

Heard Tell Of

Exploring the Terraintypically competitors as

peers focussed

Digging Burrowsfinding business value

in ecosystem approaches

Thrivingdelivering value to their

ecosystem

Where are the Enterprise Keystone Species in 2020?

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airlines Retail Health

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airlines Retail Health

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airlines Retail Health

CIBs RetailBanks

ReInsurance

PrimaryInsurance

Consumer GoodsManu

Energy Airline Health

Heard Tell Of

Exploring the Terraintypically competitors as

peers focussed

Digging Burrowsfinding business value

in ecosystem approaches

Thrivingdelivering value to their

ecosystem

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