23 May, 2018
As blockchain technology continues to gain momentum in various industries, many companies have begun to accept that it will inevitably be a game changer. At the Consensus 2018 conference in New York Monday, FedEx CEO Fred Smith said that more companies need to start becoming more acquainted with blockchain or face “possible extinction.”
“We’re quite confident that it has big, big implications in supply chain, transportation and logistics,” he said during a panel at the conference. “It’s the next frontier that’s going to completely change worldwide supply chains.”
He added: “Blockchain has the potential to completely revolutionize what’s across the border.”
Smith also explained that one major issue affecting the industry is a “massive amount of friction” in shipping products and goods across international lines due to conflicting standards and regulations worldwide.
FedEx has done its research
Earlier this year, FedEx joined the Blockchain in Transport Alliance (BiTA), a focus group whose members include rail operator BNSF, JD Logistics, and GE Transportation.
Shortly after joining BiTA, the company launched a program to find out what data would be needed to help ease tensions between customers sending and receiving goods using FedEx’s services. It also sought out solutions for storing important data using blockchain technology.
How the company plans to use blockchain
FedEx’s CIO and Executive Vice President of Information Services, Robert Carter, said the company will begin using blockchain for its freight services rather than shipping, since ships can contain millions of transactions at once: “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.”
Smith, who stands strong in support of using blockchain as a solution to several different aspects of FedEx’s operations, warned that now is the time for companies to get on board.
“If you are not willing to embrace new technologies like internet of things and blockchain […], you are, maybe subtly, at some point … going to extinction,” he said.
Image credit: N740FD FedEx Express 1990 Airbus A300B4-622R (cn 559) “Gracie,” by Tomás Del Coro.