Distributed ledger technology in supply chains An information processing view

Purpose
Lately, supply chain practitioners and academics have shown increasing interest in supply chain transparency (SCT). And, at the same time, both parties turned their attention to distributed ledger technology (DLT) and its potential for supply chain management (SCM) and in particular SCT. However, little is known why organizations seek to enhance SCT with DLT solutions and what capabilities are required for these solutions. Consequently, research and practice lacks an indication how organizations can build up these capabilities. This paper seeks to address these gaps.
Design/methodology/approach
In order to explore the drivers to use DLT solutions to enhance SCT, to identify the required capabilities and to answer how organization can build up these capabilities, the authors follow an inductive multiple case study approach. The authors selected five cases in the diamond industry, as these are the pioneers to implement DLT to enhance SCT.
Findings
Drawing on information processing theory (IPT), the cases demonstrate that organizations seek to process information across company boundaries via DLT due to a lack of transparency in the industry. In order to adopt and integrate DLT-enhanced SCT solutions, organizations have to build up organizational and interorganizational capabilities. Both types of capabilities require organizational and collaborative effort.
Research limitations/implications
The study reveals that organizations have to overcome challenges of information processing capabilities (IPC) not only on an organizational level but also on an interorganizational level.
Practical implications
The study underlines the importance of collaborative effort when seeking to enhance SCT via DLT solutions.
Original/value
This is one of the first studies to explore DLT-enhanced SCT solutions based on empirical data and identify the required capabilities for successful adoption and integration in SCM.