It shouldn’t come as a surprise that, according to Zion Market Research, the global SAP digital services ecosystem market has already hit $97.49 billion and could reach $154.44 billion within the next few years.
If this happens, the industry will have expanded by a CAGR of 6.79%, showing how industries like supply chain are set to benefit more from these services.
But as the growth happens, the need for more secure and efficient systems becomes apparent, and that’s where blockchain comes in. Well, although most people still associate the technology with digital currencies like Bitcoin, its influence on enterprise resource planning systems like SAP is hard to ignore. Just look at how BTCUSDT (Bitcoin to Tether) and other widely traded crypto pairs have become tools of digital finance revolution.
Although these assets operate in decentralized finance, the same underlying blockchain technology is driving transparency and efficiency in traditional enterprise platforms, including SAP. Keep reading to learn more about the changes this technology has brought to this sector.
The Prevailing Need for Secure Environments
Cyber attackers have become so dynamic that you can’t afford to ignore your security even for a second. Exploding Topics has recently confirmed that over 940,000 attacks happen daily. Now that this number could actually increase in the coming days, almost everyone is working hard to ensure they interact in more secure environments.
A recent study by Onapsis revealed a 400% increase in attacks involving compromised SAP systems and data, fueled by increased reliance on these enterprise systems for critical business processes. Remember, the more businesses adopt these systems, the more available data becomes, drawing the attention of malicious actors.
It could be the reason the report notes a 490% increase in criminal conversations about SAP vulnerabilities. And for businesses, cyberattacks can really cause devastating effects. For instance, they may injure your brand reputation and even cause some customers to never transact with you again. According to studies, 83% will have difficulties returning, while 21% may never do business with you again.
This just shows why you can’t enjoy long-term success if you ignore the aspect of business security. That’s why more secure technologies like blockchain have been making waves in enterprise systems. Through decentralization, blockchain eliminates the possibilities of single-point failures, which are rampant in traditional systems.
Plus, the immutability of records of financial transactions reduces the risk of fraud because data can’t be altered once it’s stored. The architecture also helps SAP systems verify data provenance, where companies can validate where data came from, when it was created and who had access. This is a huge step forward, especially now that data authenticity is under constant scrutiny.
The Role of Smart Contracts
Surprisingly, Fortune Business Insights values the global smart contracts market at $2.14 billion and thinks it can expand by a CAGR of about 24.7% in the near future. These self-executing agreements, coded with specific rules and conditions, have been drawing the attention of many experts, and SAP professionals have not been left out. Of course, most people love them for how they execute – no middleman, no delay and far less room for error.
In traditional SAP workflows, many processes, including invoice validation and procurement compliance, still require manual oversight or third-party involvement. But in smart contracts, these friction points, which can sometimes be costly, are eliminated by embedding trust directly into the process.
A good example is SAP Ariba Contracts, a contract lifecycle management solution that helps businesses streamline and digitize the contract process. It actively uses blockchain to improve trust and efficiency in complex supply chains. Surprisingly, an International Journal of Engineering Research & Technology publication by Kesava Immidi revealed that adopting blockchain reduced supply chain costs by 20-30% and documentation processing time by 85%.
What Lies Ahead?
Well, it’s actually true that blockchain technology is here to stay. In fact, a report by GlobeNewswire expects its market size to increase by a staggering CAGR of about 64.4% over a forecast period of 2024-2032. This clearly demonstrates how enterprise systems and other industries will continue to benefit from this intriguing technology.
And, of course, that doesn’t mean that blockchain will replace SAP – it will only make it smarter, more efficient and secure. But there are challenges that we must overcome. Consider security, for instance.
Although blockchain is more secure than traditional systems, it’s still susceptible to cyberattacks. In 2024, for instance, hackers stole about $2.2 billion worth of crypto funds, emphasizing the need for more robust security measures.
Scalability is another challenge that other legacy frameworks like Ethereum often face, especially during peak seasons. This could result in delays, which may hurt customers’ experience and even cause some to switch to competitors. Thankfully, developers are working hard to develop more scalable ones like Ethereum 2.0, which aims to process about 100,000 transactions per second. Plus, other advanced frameworks like Solana are emerging.
Given these developments, SAP systems could reap even more benefits from blockchain technology, especially now that we haven’t hit the climax of innovation. But so far, so good. For example, organizations using blockchain have been able to reduce supply chain costs, with some reporting reductions of up to 20-30%.
Document processing has also improved, thanks to smart contracts. As if that’s not enough, businesses have been able to strengthen their security efforts, given blockchain’s decentralized infrastructure.
Comments