SAP Leonardo Blockchain Services and Use-Cases

May 7 – 9, 2019
SAP Leonardo Blockchain Services and Use Cases
Dr. Sathya Narasimhan, (Sr. Dir, Blockchain) - SAP Labs, LLC
Nagesh Caparthy, (Blockchain Consultant) - SAP Labs, India
Session ID #ASUG84342

2PUBLIC© 2019 SAP SE or an SAP affiliate company. All rights reserved. |
About the Speakers
Dr. Sathya Narasimhan
• Sr. Dir, Blockchain Business Dev., SAP Labs,
LLC
• As senior director of blockchain business
development and product management,
Narasimhan is responsible for driving
customer adoption of enterprise blockchain
applications across the entire SAP solution
portfolio.
Nagesh Caparthy
• Associate Dev Architect, Blockchain
Consultant, SAP Labs, India
• Nagesh is an associate architect supporting
various topics such as blockchain, the SAP
Cloud portfolio, security, mobility, and the
SAP Fiori user experience. His primary focus
is to deliver partner products on blockchain
and to help create new business across
industries.

Agenda
• SAP Leonardo Blockchain Services
• Primary Opportunity Spaces
• SAP Consortium & Customer Co-Innovation
• Most Recent Successful Blockchain Story

SAP Leonardo Blockchain Services

SAP Unique Approach & Capabilities
Combining the Digital Core with Business Networks with an Open and Standards-based approach
Business Process
Centric & System of Record
Business Networks
Experience & Pedigree
SAP Cloud Platform
Blockchain

Programmable Economy: Blockchain Powered Network of Networks
Supply Chain Traceability
DigitalLedgerNetwork
AssetNetwork
International Trade

SAP Cloud Platform Blockchain
• Hyperledger Fabric on SAP Cloud Platform
• MultiChain on SAP Cloud Platform
• Quorum on SAP Cloud Platform
• Blockchain Application Enablement
• SAP HANA Blockchain service
SAP Leonardo
Technologies
SAP Cloud Platform
Blockchain
More information on https://cloudplatform.sap.com/

Pharma & Life Science
• Consortium announced at TechEd LV 2018
(Oct 2nd) with 8 founding members
• Consortium expanded and currently
includes 12 founding members
SAP Blockchain Industry Consortiums: 49 Member Companies
High Tech Consortium
• Established Consortium on June 6th
2018 with 7 founding members: LINK
includes 20 Members
CPG, Retail & Agri
Business Consortium
• Consortium announced at TechEd LV 2018
(Oct 2nd) with 9 founding members
includes 17 founding members
In addition, we have a total of 100+ customers in our program and 30+ referenceable co-innovations across Pharmaceuticals,
Consumer Products, Automotive, Agriculture, Telecom, Retail, Logistics, High-tech, Aerospace & Defense, Industrial Machinery,
Energy & Utilities, Public Services

Primary Opportunity Spaces

Incentive and value to all members of
the blockchain network is a prerequisite
SAP Enterprise Blockchain Customer Program: Learnings
Business Network Technology
Permissioned Blockchain is the Enterprise
Blockchain preferred deployment
Forces all members to jointly define and
agree on a common set of data elements
Blockchain alone is of no value: need seamless
integration into a business process and
augmentation with other technologies such as IoT
Data shredding is sometimes needed –
exact opposite of Blockchain immutability
Does not solve data quality or entry issues

Rough Solution Sketch
Parts Traceability for Optimized Quality Reporting in Aftermarket
Quality reporting for legal or on-demand reasons is a lengthy and costly process. Quality Managers spend a lot of time to generate quality reports for specific parts, either by
engaging in several lines of communication with various suppliers or by accepting lengthy processes on the supplier side. Suppliers need to report own parts traceability data either
manually or by filling information in several OEM-specific systems. Using blockchain, a single source of truth can connect buyers and suppliers - A common data model for parts
traceability for immediate update/flagging of problematic parts.
Pain Points
 Time consuming and costly for quality reporting
 Process includes several lines of communication and engaging
with various parties to acquire knowledge needed
Scope
 No one owns or controls the data
 Suppliers are responsible about maintaining own parts
information. The incentive for suppliers to join is that they will
use a single application to instantly notify all OEMs.
 OEMs can get immediately notified if they are affected
Benefits
 Reduce cost of quality reporting for all parties
 OEMs do not need to contact suppliers any longer
 Foster creative business relationship
OEM is Not Central
Owner & Can Log
Data on Blockchain
Parts Information
Logged by Suppliers Verified Parts
Distributed & Logged

Master Data Management: Payment Fraud Prevention Example
Challenges / Pain Points
 Supplier master data account change approval is a tedious and error-prone
process
 Payment fraud, phishing and other form of hacking can cause companies to
lose capital
Payment Fraud is a serious global threat to international payment systems. As of
December 2016, more than 24,000 businesses fell victim to a BEC* scam, resulting
in a total loss of over $2 billion.
*BEC = Business Email Compromise
Attackers have become increasingly sophisticated. Based on social engineering
methods, faked bank account changes sent to customers.
Rough Solution SketchCauses
• Time pressure is created by giving short term
discounts and customers try to schedule
payments close to the end of discount periods
• Requests to banks, to verify account holder
information, take up to two weeks or more
Benefits
 Streamlined, optimized supplier master
data update process, integrated to
S4/HANA finance modules
 No central authority required
 Multi-party collaboration on a single-
source of truth enables efficiency gains
and transparency for all involved
parties
 Attacks are visible and preventable
through single source of truth
properties
 Own account information, as well as
supplier relationships, are kept private
Proposed Solution
• Blockchain provides a simple and auditable
Single Source of Truth for checking supplier
account information
• Suppliers store and maintain account details
on the blockchain

Asset Lifecycle Management
When quality inspection is taking place, inspectors often want to know where all product components are from, which manufacturing activities
and what type of heating processes are being implemented. Using blockchain, tracking these processes would be made easy along with the
ability to share the records with business partners. For instance, being able to track which supplier produced certain components for specific
manufacturing functions, if the components break down, using blockchain the operator could find the specific company that produced said
component. This allows the ability to check if regular maintenance was performed as well.
Rough Solution Sketch Benefits
 Simpler way to keep track of
manufacturing processes for
each specific product
 Track if regular maintenance was
performed for components of
manufacturing
 Keep track of where components
in manufacturing come from
 Accelerate inspection processes
Pain Points
 When manufacturing components break, it’s
often difficult to trace back to which company
and when the component was purchased
 Understanding if regular maintenance has
been completed or not can be difficult to track
Scope
 Tracking all manufacturing processes
 Tracking all components received and used
throughout manufacturing
 New technology allows for data collection for
maintenance efforts for the product

Enabling Performance-Based Contracts
Blockchain-as-a-service may have the ability to adjust business models as well, to streamline and increase productivity. The operational
performance of both a critical asset or equipment can be tracked on the cost of the equipment and aspects of the performance cycle. After
the company determines a standard benchmark agreement and has been coded into the system, sensors then can communicate to the
blockchain allowing for performance factors to determine compensation.
Rough Solution Sketch Benefits
 Data tracking of performance for
all future review of assets or
equipment
Pain Points
 Performance-Based contracts aren’t
commonly used because it’s difficult to track
performance and enforce contract
 Compensation not based on performance
could cost more than those tied to specific
outcome
Scope
 Using blockchain-as-a-service to track
performance and quality
 Allows for quick and accurate data tracking for
assets or equipment
Track performance
Distribute
Compensation
Sensors
communicate to
Blockchain

Rough Solution Sketch
Transportation Management: e-Bill of Lading - Ocean, Air, Land (Truck, Rail)
The Bill of Lading (B/L) is such a paper based document. It is issued by the ocean carrier. It is used in international trade as title of goods, which are confirmed as received by a
carrier and to be released at destination to the holder of the document(s), which is the proof of ownership. This can be changed while the vessel is on the way with the use of
blockchain technology. With various partners involved with the blockchain network, the shipper or buyer can instantiate a new trade in blockchain with relevant documents, beginning
the process. The current owner of a B/L transfers ownership to another business partner, all seamlessly across blockchain, allowing for swifter management of transportation of
goods.
Pain Points
 Bill of Lading is a paper-based document that controls
ownership, which is a time consuming process
 Prone to error due to paper-based nature of document
Scope
 The ocean liner (carrier) using SAP TM issues the B/L and posts
its details into the blockchain (representing an unique token /
asset). The corresponding PDF document is uploaded and can be
digitally signed with a mobile app.
 The current owner of a B/L (e.g. the shipper) transfers ownership
of the B/L to another business partner (e.g. Banks or Buyer).
 The Buyer uploads relevant documents for import customs
clearance and enrolls the local trucking company, which confirmed
the delivery order to pickup the container from the port
Benefits
 Swifter processing for B/L process
 More traceability throughout transportation
 Allow for digital signatures and secure QR code based
authentication
Ownership of Items Transferred
Through e-Bill of Lading
E-Bill of Lading Located on
Blockchain for Swift Transfer in
Ownership with Digital
Signatures & QR codes
Payment for
Transportation Dispersed

Digital Pallets Receipt
Blockchain-based solution for Efficient Pallet Exchange
Wooden Euro pallets (EPAL) enable the smooth and efficient transportation of
goods within Europe and globally. With more than 450 million units in circulation,
it is a cheap, standardized and exchangeable asset, that has been widely
adopted by manufacturers, logistics companies, distributors and retailers.
A blockchain based solution developed by GS1 on the SAP Cloud Platform
enables industry participants to record and exchange pallet receipt notes in a
peer to peer environment without the need for a centralized intermediary.
Challenges / Pain Points
 Paper-based pallet receipts make exchange between participants difficult
 Pallet logistics add inefficiencies to the supply chain process
 Lack of transparency over pallet availability at destination
Benefits
 Immutable, single source of truth
provided to all supply chain network
participants
 Standardized data elements and
processes
 Minimal complexity, maximal security
 Supply chain efficiency
Rough Solution SketchCustomer Requirements
 Easy onboarding on the network for new
members
 Records of material provenance stored
on a blockchain based system
 Confidentiality of trade relationships
Proposed Solution
 Blockchain based “barter” solution for
pallet receipt exchange
 Scalable solution that can be utilized by
“on-the-ground” employees

SAP Consortium & Customer Co-Innovation

Asset Intensive
Industries
Transportation &
Logistics
Discrete Mfg.
Industries
Life Sciences &
Pharmaceuticals
Retail, Consumer
Products,
Agribusiness
High Tech & Telco
SAP Industry Blockchain Consortiums

Engagement Model: SAP Innovation Services

Most Recent Successful Blockchain Story

Ocean to Table Blockchain – Bumble Bee Seafoods
Business challenge
• Increase Corporate Social Responsibility, Local Livelihood, & Sustainable Catch Awareness
• Maintain Transparency & Data Integrity as Tuna moves from Source to Consumer
Solution
• Blockchain Technology maintains Data Integrity & Transparency through Supply Chain
• Sharing Information across Suppliers, Strategic Partners, Non-Governmental Agencies
[NGO’s] to insure best Outcomes
Outcome
• Integrated Supply Chain results in Efficiency, Transparency, & Data Integrity
• Education/Promotion of Sustainable Fishing
• Increased Transparency to Consumer, resulting in Market Premium where Fair Trade
Products are sold
• Increased Local Livelihood, such as additional Income from the Fair Trade Premium paid to
Fishermen for their Catch
Featured Technologies
• Blockchain technologies
• SAP Cloud Platform
• SAP HANA Database
• SAP Analytics Cloud
• SAP Cloud Applications
Project Timeline:
• September 2018: Proof of Concept
• December 2018: Pilot Deployment
• February 2019: Live Deployment

Live Demo:
Scan QR Code to learn
about out the origin of the
Tuna you are buying!
Ocean to Table Blockchain – Demo

Identification & Verification of Sellable Returns
Legal requirement Business ChallengePurpose
SAP Advanced Track &
Trace for Pharmaceuticals
Manufacturers Wholesaler
Scanning System
Drug Supply Chain Security Act
demands companies to both
identify and verify sellable returns
2-3% of total sales are sellable
returns (58.7 million units a year)
Help secure the health of patients
by fighting fraudulent activities

Supply Chain Provenance: application example

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SAP Leonardo Blockchain Services and Use-Cases

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