The Implementation of Smart Contract via Blockchain Technology in Supply Chain Management: A Case Study from The Automotive Industry in Turkey

Abstract

Blockchain Technology, underlined as the most revolutionizing innovation after the internet, is still in the growth phase and waits for the practitioners to enlighten its productivity promises. In the current environment, volatile profits require a more digitalized work experience and competitive advantages to get ahead in such a highly competitive automotive industry and innovative applications that lead to more simplified operation management. Accordingly, this paper aims to present a case study via use cases in which Blockchain has been used and smart contract as the sought-out innovation and its application for the digitized spare parts disposal legal process. Blockchain Technology in the automotive sector is discussed by focusing on the supply management process of an automotive company's processes in Turkey. Blockchain technology is expected to develop and simplify spare parts-related transactions in the automotive industry, which deals with more than 500K stock keeping units per company. Paper presents the current, future, and ideal states of spare parts transactions with Blockchain adoption. The implemented application enables the development of an enterprise-level blockchain platform with hyper-ledger fabric as an open-source. The distributed ledger technology provides a smart contract system between actors of the existed supply chain process. The study aims to show the potential of Blockchain Technology in delivering a high degree of competitive advantage especially for automotive service providers with regards to its features related to providing security, transparency, traceability, cost reduction, more efficient data storage in dense supply based industries.