- More than half of IT executives strongly believe that blockchain will become a disruptive force in the healthcare industry, according to a global, cross-industry survey conducted by Deloitte, while nearly three-quarters see blockchain as a major disruptor for life sciences and pharmaceutical development.
Across all sectors, 43 percent of more than 1000 respondents have placed blockchain among their most critical organizational priorities, with another 29 percent believe the distributed ledger methodology is important, but not vital, to continued success.
Healthcare executives are somewhat less eager than their peers to put blockchain on the top of the to-do list. Only 39 percent of provider-focused organizations count blockchain among their top five priorities.
However, 60 percent of healthcare and life sciences executives said they are likely to lose a competitive advantage if they do not invest in blockchain technologies.
“Blockchain is at an inflection point, with momentum shifting from ‘blockchain tourism’ and exploration to the building of practical business applications,” Deloitte says.
In healthcare and the life sciences, these practical applications generally revolve around disintermediation, such as replacing data aggregator entities with trustless blockchain tools, and creating more transparency both within organizations and between collaborators.
Across the industry spectrum, organizations are most interested in using blockchain to improve their supply chains (53 percent), manage the Internet of Things (51 percent), and streamline digital identity management (50 percent).
Healthcare organizations have increased their interest in blockchain and their knowledge of how it works over the past twelve months says Deloitte, leading to greater investment in developing distributed technologies.
Just under three-quarters of healthcare executives and 70 percent of life science executives now describe their understanding of blockchain as “excellent” or “expert.”
Eighteen percent of healthcare enterprises – and 30 percent of life science companies – have already invested between $5 million and $10 million in blockchain thus far.
However, healthcare organizations are also among the most likely across all industries to report investing little or nothing. Twelve percent of healthcare organizations have not made any investment in blockchain, second only to the public sector.
In contrast, 61 percent of automotive companies, 45 percent of oil and gas companies, and 41 percent of technology and media companies have spent more than $5 million on blockchain tools. Thirty-eight percent of auto companies have devoted more than $10 million to research and implementation, representing the most significant investment among the surveyed industries.
Yet despite spending less, healthcare organizations do not lag significantly behind other industries in awareness and experimentation.
Forty-one percent of healthcare executives and 43 percent of life science leaders consider themselves in the “awareness and education” phase of blockchain adoption, similar to their peers in financial services, the public sector, and technology, media, and telecom.
Forty-five percent of healthcare organizations are running pilots or proof-of-concept programs, on par with manufacturing and only slightly behind oil and gas, financial services, and the food industry.
But when it comes to active production and deployment, healthcare is measurably behind the pack.
Only 11 percent of healthcare executives said their organizations are actively deploying blockchain in some part of the enterprise. While that number is similar to the automotive and financial services industries, it is less than half of the adoption rate in life sciences and a third of the activity in manufacturing.
Twenty-four percent of US-based executives are currently investing in hiring staff with blockchain experience to support these endeavors, and another 21 percent are planning to do so within the next calendar year. About half of organizations have no concrete plans – or no plans at all – to bring blockchain experts on board.
In a stark international contrast, 86 percent of Chinese organizations have already started to build their blockchain teams, and 12 percent will do so within the calendar year. Only two percent of companies in China expressed any uncertainty at all about when they will be hiring experienced blockchain staff.
To remain competitive in a quickly accelerating global environment, organizations are turning to collaborative consortia to share insights and speed up development of new ideas, Deloitte noted.
“Approximately 29 percent of our respondents have already joined an existing consortium, with nearly 45 percent saying they are likely to join one within the next year,” said the report. “And more than 13 percent say they are interested in starting a consortium of their own.”
“As blockchain gains traction and influence, we believe the benefits of consortia, including their shared costs, ability to create unified industry standards, and advantages of scale, will make them even more attractive options for companies in finance, technology, and healthcare over the next two to three years,” the survey added.
Progress made within industry consortia may continue to fuel existing high levels of optimism and encourage broader adoption, the survey indicates.
Eighty-four percent of executives believe that blockchain is a scalable technology that will eventually become mainstream, and 74 percent say their organizational leaders are convinced that there are compelling business use cases for blockchain-based tools.
Respondents are anticipating a number of direct benefits from blockchain adoption, including greater speed with processing transactions (32 percent), new business models and revenue sources (28 percent) and enhanced security (21 percent).
“As more organizations put their human and financial resources behind blockchain and come to better realize how it can improve their business processes and their bottom lines, we expect blockchain to gain significant traction as its cost savings, competitive advantages, and ROI benefits become more pronounced,” said Deloitte.
“As connections are made between blockchain and other emerging technologies, particularly the cloud and automation, we see the potential for blockchain to help organizations create and realize new value for businesses beyond anything we can imagine with existing technologies.”