Event-Based Supply Chain Network Modeling: Blockchain for Good Coffee

Abstract

Blockchain and distributed ledger technology (BC/DLT) provides distributed databases with decentralized governance, tamper-proof recording, high availability and non-copyable digital assets, which have made it a natural technological basis for supply chain management. In this paper, we introduce REALISTIC, a novel event-based modeling framework for supply chain networks (SCNs) that includes production processes. It extends McCarty’s Resources-Events-Agents (REA) accounting model with secure transformations, which, across the entire SCN, guarantee that certified output resources cannot be digitally produced ex nihilo, but require certified input resources of at least the same amount as what is produced. This generalizes the no-double-spend guarantee of current BC/DLT to (digital twins of) physical resources and their production. Authenticated human or robotic Internet of Things (IoT) actors digitally sign and cryptographically commit to the veracity of real-world events on an immutable database, without having to take responsibility for their aggregate consequences. User-specifiable interpretations, corresponding to queries and analytical functions in database systems, provide auditable aggregate information computed from recorded events across the entire SCN. This includes fine-grained and trustworthy tracing of final products through multiple stages of production processes, semi-finished products, quality certifications and transportation all the way back to their raw materials. We present a case study for an end-to-end coffee supply chain that tracks fine-grained and detailed information from a farmer’s coffee cherries to retail coffee bags, involving all its actors. Our model handles product provenance; auditable sustainability, quality and trade information; production processes from parchment via green to roasted coffee; product quality tests; farmer certifications; and transportation across the entire coffee supply chain. It is based on field work involving farmers, cooperatives, processors, traders, importers, and a major roasting company stretching from Colombia to Scandinavia. Its REALISTIC-based modeling is the foundation for the design of our prototype implementation, which includes Ethereum blockchain code, RDBMS-based server code and a web app client. Their source code is publicly available on GitHub.

Decentralized governance and artificial intelligence policy with blockchain-based voting in federated learning

“…Layer 1 is a blockchain architectural term that refers to a network that provides infrastructure or consensus on projects, such as an event-based coffee supply chain (Bager et al, 2022 ). A virtual machine (VM) is a computer system with complete hardware functions simulated by software and running in a completely isolated environment.…”

Blockchain-Based Traceability System From the Users’ Perspective: A Case Study of Thai Coffee Supply Chain

“…Recently, Bager et al [39,40] implemented an eventbased modeling framework for the coffee supply chain, using blockchain to increase traceability and transparency. Their work was based on fieldwork involving stakeholders, and they reported barriers and opportunities for technology adoption.…”

Coffee producers’ perspectives of blockchain technology in the context of sustainable global value chains

“…Using the case of coffee, we conducted a pilot test with Peter Larsen Kaffe's value chain from Antioquia, Colombia involving six coffee producers and report the finding in a series of peer reviewed papers including this one. Bager et al (2022a) describe the programming-related aspects of the model, while Bager et al (2022b) describe the full case study, including the challenges and opportunities of employing blockchain to address sustainability issues for each supply chain node. Instead of examining an existing and fully operational blockchain solution for supply chain management, we hence map Peter Larsen Kaffe's supply chain in Colombia, including stakeholder consultations, and develop a prototype.…”

“…The blockchain-based application has been modelled according to the REALISTIC modelling framework that is built on McCarty's Resources-Events-Agents (REA) accounting model and uses etherium (Bager et al, 2022a). The application is eventdriven, which means that new data blocks entered represent time stamped events or transactions, backed by evidence for each event type (e.g., harvest, purchase, dry milling and roasting) (Bager et al, 2022a).…”

“…Second and third parties can verify evidence in the form of photos and documents tied to the events. Data is publicly available, which enables both producers and consumers to track and trace product units from farm to cup, while a rich data visualization enhances the experience (Bager et al, 2022a).…”