“Blockchain has the potential to completely revolutionize what’s across the border.”
Speaking at CoinDesk’s Consensus 2018 in New York today, Fred Smith, chairman and CEO of the U.S. logistic giant FedEx, doubled down on his commitment to embracing blockchain technology as a way for the decades-old company to maintain its game in a rapidly changing digital world.
Smith explained that one major issue that the logistic and transportation industry has faced is the “massive amount of friction” in cross-border logistics, since different countries have different standards, regulations and terminologies.
He told the audience:
“For cross-border shipments, ‘trust’ is legal requirement for every transaction. What blockchain has is a potential for the first time ever to make the information available for everybody.”
As such, the FedEx chief praised the “chain of custody” that blockchain can bring to the entire logistic industry.
All this talk isn’t just hot air, either – FedEx joined the Blockchain in Transportation Alliance (BiTA) in February this year in a bid to explore potential blockchain applications alongside other partners within the logistic industry.
At the time, the firm also launched a pilot program to establish what data would be needed for a distributed ledger to ease disputes between customers sending and receiving goods through FedEx. The shipping giant also wants to use blockchain to store its records.
Also speaking at the panel session, Robert Carter, FedEx’s CIO and executive vice president of information services, said the firm will first explore that deployment in the freight industry, since one single ship could contain millions of transactions at the same time.
Carter commented:
“We move easily 12 million shipments a day and that more than doubles during the peak seasons. While we absolutely believe this technology is going to scale, right now it makes sense for us to do this in our freight world,”
Answering a question from the panel’s host, author Don Tapscott, on how he persuaded Smith to approve the decision on blockchain exploration, Carter said, in fact, it was the other way round.
“It’s Fred that dragged me into this,” Carter said, adding:
“The application of these custody chains … is so critical to the information aspect. We’re operating on this plane between the physical world and the digital world.”
Speaking on the importance of moving with the times as a company, Smith concluded:
“If you are not operating at the edge of new technologies, you will surely be disrupted. If you are not willing to embrace new technologies like internet of things and blockchain to face those new threats, you are, maybe subtly, at some point … going to extinction.”
Panel image via CoinDesk