According to recent research from the University of Surrey, the slow uptake of blockchain technology can be attributed to overly enthusiastic promises that often cloud the real and multifaceted challenges it presents regarding technology, organisation, and the environment.
Blockchain functions as a secure digital ledger, documenting and confirming transactions across numerous computers in a manner that is difficult to alter. This system operates like a digital notebook accessible to all, displaying all entries openly while ensuring that it cannot be modified once data is recorded. Initially, blockchain was highly celebrated for its potential to facilitate secure, transparent transactions without the need for intermediaries such as banks. Beyond its foundational role in cryptocurrencies like Bitcoin, its application possibilities in finance, healthcare, and supply chains are being actively explored.
The study, spearheaded by PhD candidate Ying Zhang in collaboration with scholars from Surrey Business School and Cardiff Business School, exhaustively analysed 880 factors influencing the adoption of blockchain by organisations in diverse industries.
Dr Mahdi Tavalaei, a Senior Lecturer in Strategy and Digital Transformation at the University of Surrey and co-author of the study, commented on the findings, noting the cautious approach of many organisations. He explained that despite the revolutionary potential attributed to the blockchain, its actual adoption had been stalled by promises that exceed delivery, the lack of tangible business value, and the intricate interplay between the drivers and barriers to adoption.
The research did highlight some positive aspects, identifying blockchain’s unique features, such as improved transparency, security, and operational efficiency, as strong incentives for its adoption. Nevertheless, these driving factors are frequently overshadowed by significant barriers, complicating the adoption process. The study highlighted that regulatory uncertainties and scalability challenges are more pronounced and definitive. In contrast, the advantages of adopting blockchain are conditional and likely to only manifest in the long term. This creates a discrepancy that hampers quick decision-making within organisations regarding adopting this technology.
The study further suggests that more than the technological benefits of blockchain alone are needed for many organisations to justify its adoption. These benefits are intricately linked to internal and external organisational factors, including the beliefs of top management regarding technology, cross-organisational collaboration, and the existing regulatory frameworks. Dr Tavalaei elaborated on these points, stressing that while blockchain holds significant potential, there is a need for a more grounded narrative surrounding its adoption. He pointed out that the interaction between the various drivers and barriers across technological, organisational, and environmental dimensions illustrates the complex and sometimes conflicting dynamics organisations need to navigate. According to him, organisations are not merely reluctant; they make deliberate decisions based on the existing limitations and the often overstated blockchain promises. Through this research, Dr Tavalaei and his team aim to steer the discussion towards setting more realistic and attainable objectives for blockchain technology.
More information: Ying Zhang et al, Evolution or involution? A systematic literature review of organisations’ blockchain adoption factors, Technological Forecasting and Social Change. DOI: 10.1016/j.techfore.2024.123710
Journal information: Technological Forecasting and Social Change Provided by University of Surrey