Addressing the Practical Challenges of Implementing Blockchain in Engineering and Manufacturing
Authors: Kneissler Andreas , Oelbracht Stefan 
Published: October 2023

This paper describes the state of the art and the potential for realized application of blockchain technology in the machinery and equipment industry for secure exchange of process and product data between the supplier and the customer.Since its introduction and increasing popularity in the financial industry, Blockchain has become a transformative technology with significant impact on various industries. It has attracted significant attention and interest in sectors such as supply chain management, insurance, and agriculture. The use of blockchain in manufacturing and engineering is even more novel.By providing a decentralized and immutable ledger, blockchains can enable secure and transparent transactions, streamlined supply chain management, improved traceability of products, and greater trust in the integrity and validity of data between participants in a network.Aside from cryptocurrencies, interest, understanding, use, and implementation of blockchain technology are still at an early stage. Consequently, blockchain technologies are still encountering various problems and limitations. These include excessive energy consumption for computational tasks, suboptimal efficiency of consensus mechanisms, significant computational overhead in network systems, and low transaction throughput rates. The significant latency in transactions can lead to uncertainty among participants. In addition, blockchain is not suitable for current engineering and manufacturing applications due to its high energy requirements and the need for high computational power, large storage space, and high CPU power for the consensus algorithms.In reviewing the existing literature, it becomes evident that while a significant amount of research has been conducted on blockchain applications in various fields, the focus has been primarily on descriptive and theoretical proposals. Despite the increasing focus on research and the growing number of published papers on blockchain applications outside of cryptocurrencies, there is a distinct lack of empirical studies that provide an accurate analysis of the technology's effectiveness in practice.While new frameworks are being proposed that attempt to address these issues and limitations, their validation and testing in real-world operational environments is limited.The limited number of cases in the literature addressing the operational implementation of blockchain-based approaches indicates that significant practical challenges, such as the speed of communication between machines, must be resolved before the technology can gain widespread adoption beyond the cryptocurrency space.With this in mind, it is critical to test blockchain applications in some real industrial environments to determine their viability and address any practical shortcomings. Identifying and addressing these challenges will be necessary to improve the effectiveness and efficiency of Blockchain-based systems.In addition, it is imperative to investigate whether blockchain approaches are suitable for manufacturing and engineering applications. This can be achieved by exploring potential hybrid systems that incorporate proven data management approaches, especially for simple components (e.g., temperature sensors). The aim is to ensure optimal performance and minimize potential risks and unnecessary complexity without sacrificing the positive aspects such as anti-counterfeiting and barrier-free data availability.