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ACCA Strategic Professional · Strategic Business Leader · Enabling success: disruptive technologies

Norvik Foods wants to use blockchain to trace produce from farm to supermarket and prove provenance to consumers. Consultants note the ledger itself is immutable, yet a recent audit found farm staff sometimes entered false origin data at the point of capture. What does this imply for the strategy?

Blockchain secures data against later alteration but cannot verify that information was true when first entered. Because staff entered false origin data, Norvik needs strong input controls, such as automated sensors, verification and supplier audits, alongside the blockchain to achieve reliable provenance.

  1. ABlockchain guarantees only that recorded data is unchanged, not that it was accurate when entered, so controls over data capture are still neededCorrect
  2. BImmutability ensures all data entered is truthful, so no further controls are required
  3. CThe project should be abandoned because blockchain cannot record any origin data
  4. DThe false entries will be automatically corrected by network consensus

Explanation

This is the 'garbage in, garbage out' limitation. Consensus validates that a transaction follows protocol rules, not that real-world information is true. Controls such as sensors, verification and supplier audits are needed at input. Immutability may even preserve false entries permanently.

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