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THE UNIVERSITY OF HUDDERSFIELD

School of Computing and Engineering

Effective Research and Professional Practice

Topic – Block chain and Information Systems

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Abstract

Significance – Blockchain technology is heralded as the most transformational technology of

the 21st century. Blockchain networks are efficient in tracking production, orders, accounts,

payments, etc. And since there is a single view of the truth, all the details of a transaction can

be seen and tracked end to end. This gives more confidence, enhances efficiency, and

provides more opportunities.

Objective – To understand the impact of blockchain technology on the information systems

in the corporate world, to identify how it is shaping the businesses and what future does it

hold?

Methods Used – Primary research has been conducted to explore the potential benefits and

drawbacks of blockchain technology and information systems in businesses and how they

transform the corporate world.

Research Question – How is blockchain technology shaping the information systems in

businesses?

Findings – Despite several drawbacks, it still holds a promising future for businesses and

several opportunities in terms of transparency, efficiency, privacy, security, lesser errors,

costs, and verification needed.

Conclusion – Almost all businesses, particularly global giant corporations, should adopt

blockchain information system technology to improve their business models.

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Introduction to Block Chain

A blockchain is a database distributed between different nodes inside a network of

computers (Hayes, 2022). A blockchain, as a database, stores data in digital form

electronically. It is widely famous for its significant part in cryptocurrency systems, for

example, Bitcoin, to maintain a decentralized and secure record of transactions. Blockchain

has brought innovation with itself in a way that it ensures the fidelity as well as the security

of the data record. Moreover, it generates trust and does not require any third party to develop

the factor of trust (Nofer et al., 2017).

The way the data is structured is the main difference between a blockchain and a

typical database. The information is collected together in different groups called blocks in the

blockchain. These blocks hold sets of data and information. There is a certain capacity of

storage in a block to store information, and when a block is filled with it, it is then closed and

linked to the formerly packed block. This forms a chain of data, and thus comes the name

blockchain. After a freshly added block, all the new coming information is compiled in the

new block formed, which is again added and linked to the chain after it is filled with the

information.

The usual database arranges and structures the data in the form of tables. On the

contrary, as the name implies, a blockchain arranges and structures its data in the form of

blocks (chunks) that are strung together. When implemented decentralized, an irreversible

timeline of data is formed inherently by this type of data structure. After being filled, the

block is set in stone and is now considered part of the timeline. A timestamp is given to all

the blocks added to the chain with an exact time.

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How Does a Blockchain Work?

The basic objective is to make sure that the digital information is being recorded and

distributed but is not editable. This is how the blockchain forms the basis for immutable

ledgers and transaction records that are neither changed, deleted, nor demolished. This is why

blockchains are popular as Distributed Ledger Technology (DLT) too.

Why is Blockchain Technology Important in Business?

When it comes to a business, it needs several types of information. It is this

information based on which a business is run. The faster the flow of and the more accurate

the information is, the better the performance and productivity of the business. And with the

inception of the internet, digitalization, and globalization, big data generates even at the pace

of seconds, and to handle such a huge amount of information, blockchain technology is an

ideal choice. The information delivered by the blockchain is immediate, can be shared, and is

completely transparent as stored on an immutable ledger. Moreover, it is only accessible to

the authorized members of the network ("What is Blockchain Technology? - IBM

Blockchain", 2022).

BlockChain & Information Systems (The next frontier in IT)

Blockchain is simply a list of data records but shared and decentralized. This is often

termed a ledger where several participants' transactions are registered. It boosts the pace of

transactions while protecting deletion, revision, and tampering of the data.

Blockchain is heralded as one of the most transformational technologies of this era.

This is why it is next to certain that it will impact the business somehow or the other

("Blockchain technology: the next frontier in information tech," 2022).

Due to the vast and diverse applications of blockchain technology, business leaders

are now grasping and implementing this technology in their businesses to make the most out

of it. The applications of blockchain technology are not limited to the supply chain. Still, they
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are also found in customs to food safety, improving customer engagement, analyzing big data

to understand customer insights, and so on. They are poised to unlock the potential

blockchain technology holds for the future growth of their businesses ("Blockchain

technology: the next frontier in information tech," 2022).

Every transaction made in a business is tracked in a Ledger, whether a transaction is

about transferring assets like money, goods, contracts, patents, or anything of value. These

ledgers are usually inefficient, time-consuming, non-transparent, expensive to make, and

entail the factor of trust, making them sensitive to fraud and misuse. This requires the

involvement of third parties like governing bodies, auditors, inspectors, banks, certifiers, or

any other party who verifies these ledgers ("Blockchain technology: the next frontier in

information tech," 2022). However, in the case of implementing a blockchain technology

information system, all these deficiencies are covered and catered to.

Methods

Along with the literature review, primary research, in the form of a questionnaire

formed and distributed to a business that has implemented this information system, has been

conducted. This explores the potential benefits and drawbacks of blockchain technology and

information system in businesses. This research will further study how it is transforming the

corporate world and handling transactions and data and information. The questionnaire was

distributed to 25 employees of the organization who were asked about how this technology

has impacted their business.

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Results

Does blockchain informati on system

improves privacy and security of trans-
actions?

5% Yes
No
I don’t know

85%

Blockchain technology forms a digital Ledger that is tamper-proof shared, and all the

transactions recorded in it, whether public or private, are in a peer-to-peer network.

Has blockchain informati on system reduce

the cost of verifi cati on in the business?

5%

Yes
15%
No
I don’t know

80%

Blockchain has potentially eliminated the role of intermediaries and other central third

parties to develop the trust factor.

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Are transactions on the blockchain in-

formati on system transparent and can
be tracked end to end?
2%

Yes
10%
No
I don’t know

87%

All the assets are embedded in digital code and stored in databases transparent and

distributed. Each transaction is validated and identified by the entire network because its

unique digital signature protects it from deletion, variation, and tampering.

Analysis & Discussion

From the results generated from the primary research conducted, it has been analyzed

that given the complexity, blockchain has the potential to record data in a decentralized way

without any limit while ensuring greater user privacy and security to reduce the processing

fees and probability of errors.

But since every coin has two sides, blockchain technology also has some drawbacks

and its advantages, highlighted in the following discussion.

Pros

Zheng et al. (2018) discuss the following opportunities associated with blockchain

technology.

1. Blockchain technology ensures improved accuracy as it removes the involvement of

humans to verify various transactions.

2. It also helps in reducing costs as it does not require third-party verification.

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3. It works on decentralization which is why data and information cannot be tampered

with.

4. It ensures the security, privacy, and efficiency of the data.

5. It is a transparent technology where transactions can be tracked end to end.

6. Blockchain technology is an alternative to banking where the personal information of

citizens of a country is secure even though the country is politically unstable or has

underdeveloped the government.

Cons

Zheng et al. (2018) discuss the following challenges associated with blockchain

technology.

1. The cost is associated with the mining of Bitcoin.

2. There is no number of transactions in a second.

3. It has a history of use in illicit activities like the dark web.

4. Its regulation varies from jurisdiction to jurisdiction, and it is still uncertain.

5. There are limitations to data storage as well.

Conclusion & Future Suggestions

Even though blockchain technology has several drawbacks, it still holds a promising

future for businesses and several opportunities. It offers businesses a chance to improve the

business transparency, efficiency, effectiveness, productivity, performance, privacy, safety,

security and reduce the number of errors, verification, the cost associated with third parties to

verify the data. Though the drawbacks cannot be neglected, various measures have been

developed to cater to them. Also, further research is continuously in progress to bring

improvements. Thus, it is suggested that almost all businesses, particularly those who run

based on various amounts of transactions being carried out within a matter of seconds on a
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global level, adopt blockchain information system technology to improve their business

models.
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References

Blockchain technology: the next frontier in information tech. Delaware. pro. (2022).

Retrieved 9 February 2022, from https://www.delaware.pro/en-be/solutions/blockchain-

technology.

Hayes, A. (2022). Blockchain Explained. Investopedia. Retrieved 9 February 2022, from

https://www.investopedia.com/terms/b/blockchain.asp.

Nofer, M., Gomber, P., Hinz, O., & Schiereck, D. (2017). Blockchain. Business &

Information Systems Engineering, 59(3), 183-187.

What is Blockchain Technology? - IBM Blockchain. Ibm.com. (2022). Retrieved 9 February

2022, from https://www.ibm.com/topics/what-is-blockchain.

Zheng, Z., Xie, S., Dai, H. N., Chen, X., & Wang, H. (2018). Blockchain challenges and

opportunities: A survey. International Journal of Web and Grid Services, 14(4), 352-

375.