TOP 10 mistakes in organizing blockchain projects from Gartner Inc

Recently, he began to closely study the market for Bitcoin & Blockchain solutions. And I found an interesting pattern: many IT specialists did a good job, or even had a good understanding of the technical component, but did not want to look at the blockchain more broadly - from the organizational point of view. As a rule, today they dwell on the economic, less often the political component. But there are pleasant exceptions - such as this cycle on Habrahabr .

So, below I offer a translation of 10 errors that were reported in Gartner Inc, which is a leading company in the field of research, including IT.



As the blockchain develops, CIOs can avoid an unreasonable failure by considering common traps.

Organizations have begun experimenting with blockchain technology for a range of use cases, including remittances, academic certification systems, land title systems, and product tracking. Nevertheless, according to Gartner, 90% of blockchain-based projects launched in 2015 are closed within 18-24 months .

Part of the problem is that most (on) blockchain projects do not actually require this technology. In fact, these projects would probably be more successful if they did not use the blockchain.

Blockchain technology is at the peak of high expectations in the Gartner Hype Cycle, which means that before embarking on a swim, IT managers must be aware of common mistakes (errors) that can lead to disappointment and failure in corporate projects.

“The current generation of technology platforms has significant limitations in many areas, which will lead to their inability to meet the requirements set forth in the long-term vision (understanding),” said Ray Valdes, vice president and employee of Gartner. Many businesses are still trying to blindly jump aboard "... and for most of them, disappointment will be the next step."

However, a simple vision of the “thin spots” will help enterprises avoid getting into the same networks.

1. Misunderstanding or ignoring the purpose of blockchain technology.

To effectively use blockchain technology, a project must add credibility to an untrusted environment and use a distributed registry mechanism. Deploying a private blockchain weakens security conditions in favor of a centralized identity management system, as well as a consensus mechanism that eliminates all assumptions (o) about unreliability. To remedy this, enterprises must create a trust model for the entire system to define areas of trust versus areas of non-trust and apply blockchain only in untrusted parts .

2. The assumption that the current technology is ready for use in production.

Despite the fact that there are more than 50 different platforms based on technology on the market, only Bitcoin and Ethereum are proven to be “(on an appropriate) scale”. However, in reality, third-rate system integrators and multi-start-ups are selling the technology as if it were mature. CIOs should understand that most blockchain platforms will be immature for 24 months and (will) continue to experiment and prove the (predefined) concept, especially in the context of open source.

3. The unclear future of blockchain technology for the current generation.

The modern blockchain platform is limited in scope and lags behind meeting the requirements of a global distribution platform that could create a programmable economy. Although this is a long-term plan for (this) technology, CIOs should use a timeline that correlates with the changing capabilities of the blockchain functionality, as well as its legal , accounting and regulatory maturity.

4. Do not confuse a limited entry-level protocol with a complete business solution.

Although the term blockchain is often used in combination with innovative solutions in industries such as supply chain management or medical information systems, it should be understood thatnot everything that is currently available on the market corresponds to what is advertised in the news . Considering the way in which blockchain is being discussed now, IT managers may think that the current technology at the very initial level is essentially a complete solution for applications. But in reality (the same), the blockchain (will) have a long development path before it is ready to show its full potential. When considering a large-scale, ambitious blockchain project, IT directors should keep in mind that the share of blockchain should be less than 5% of the total project development effort.

5. Consideration of blockchain technology solely as a database or mechanism for their storage.

Some IT executives identify a “distributed registry” with a data retention mechanism or a distributed database management system. Currently, blockchain implements sequential data recording of only the most significant events. It offers limited data management capabilities in exchange for a decentralized service and avoids trust in any one central organization. CIOs should be aware and weigh the trade-offs regarding data management to ensure that the blockchain in its current form is the right corporate solution.

6. The assumption of interoperability between platforms that do not yet exist.

Most blockchain technologies are still under development and do not have specific technological (or business) roadmaps. In essence, wallets do not have primary interchangeability, and the ledgers (registries) themselves do not have built-in integration capabilities. Critically, blockchain standards do not yet exist . This means that, in addition to the supposed potential interoperability at the most basic level, CIOs should be skeptical of any vendor discussions about collaboration. Although there are several competing suppliers, the technology has not matured to the point where interoperability can be achieved.. Do not expect that from 2016 “blocking platforms” will interact with “blocking platforms” of another provider.

7. The assumption that today's leading platforms will still dominate or simply exist tomorrow.

CIOs should not be flattered that the technology selected for the project this year will be long-term. As with the mobile, social, and e-commerce platforms of the past, perhaps the most efficient technology has not yet been created. CIOs should consider blockchain options from 2016 and early 2017 as temporary or short-term options and, accordingly, plan projects in this vein.

8. The assumption that smart contract technology is the solution.

Smart contracts, computer protocols that will facilitate and enforce contracts, are what will allow the economy to become programmable. However, at a technical level, smart contracts currently do not have scalability, reliability, manageability and verifiability (at the proper level?). In addition, there is currently no legal basis - locally or globally - for their application. All this will develop in the next three to five years, but CIOs should be careful when developing smart contracts as part of the current blockchain proposals and seek legal advice on their use.

9. Ignoring the problems of financing and peer-to-peer management of a distributed network.

The hypothesis is that blockchain platforms will be less expensive than the existing system of several networks, processes and data interacting with each other. However, the cost of blockchain technology will be significant - and will increase if the existing legacy does not disappear - and who will pay for the process in which several parties are involved, for the most part, remains unanswered . In addition, as the system grows in scale, so does the cost. Multi-party systems require new approaches to governance, security, and economics that raise technical as well as political, social, and organizational issues.

10. Failure to include the learning process.

Enterprises should take a practical approach to blockchain projects. The current time frame is very important for creating test and training constructions. Lessons learned from experiments with platforms, new business models, processes and products will be useful for future implementations as part of a large-scale digital transformation. Even if the projects are contracted, the IT department must work closely with a third-party vendor / partner to learn skills and concepts such as smart contracts, negotiation mechanisms, identity management, management and much more - everything that can be useful for future projects. IT managers must ensure the development and transfer of knowledge throughout the enterprise and understand for themselves that knowledge can be the only value,

PS The translation itself was not an end in itself for me, because My English is relatively meager (I thank my best friend for help). But much more important are the problems identified in the study. I hope that their description will help those who are at the beginning of the blockchain path, as well as those who already follow it, but believe that "everything has been done."

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