Change is coming, and it’s coming in the form of a recalibration of many aspects of our lives.
For the past few years, digital transformation has been on the map for many businesses. They planned and, slowly, started to implement the necessary platforms and services to digitally transform their business processes.
The Covid-19 pandemic accelerated many businesses’ digital transformation efforts, especially since more people were using the Internet than ever before and many of their customers now preferred to use digital channels to do business.
One of the essential parts of an effective digital transformation strategy is implementing a document management system (DMS). This offers businesses a variety of benefits including saving time and making their business processes more efficient.
Blockchain technology promises to improve document management systems significantly. While it offers the same benefits, it enhances them and, because of the way it works, makes document storage and management more secure.
But how can blockchain improve document management systems? In this post, we’ll look at this question in more detail.
What is Blockchain?
The best way to think about blockchain is to think of it as a database. Now, a typical database stores data in tables which makes it easy for users to query the data and find the information they’re looking for.
The significant difference between a typical database and a blockchain is the way the data is stored and structured. Unlike a traditional database, data in a blockchain is stored in groups or blocks.
Every time a new data entry is made, it’s written to the block and once the block is full, it’s chained to the previous block. It’s for this reason that it’s known as a blockchain. When new data is then entered, it’s written to a new block until that block is full and then chained to the existing blockchain. This cycle then continues for all data in the future.
The benefit of blockchain technology is that it creates an exact timestamp every time data is entered into the blockchain. As a result, data entries are fixed in time and can’t be changed. So, you can almost think of it like a brick wall where every time you place the brick, you write something on it. Once a new brick is cemented on top of it, that writing is fixed and can’t be changed.
This provides better transparency and blockchain’s distributed nature makes it less vulnerable to security threats. In fact, there have been hardly any cases where a blockchain’s security has been breached.