As Business Hyperconnectivity Runs Rampant, What Happens to Privacy and Control?


Next time you open a package from your favorite online shopping site, pause and consider the many companies that exchanged vast of amounts of information with breathtaking speed to deliver that item to your front door.

Modern supply chains are ground zero for what many industry experts call the phase level of “hyperconnectivity.” We love getting the goods we want as quickly and inexpensively as possible, but it takes an awful lot of data sharing between totally separate companies to make it work. Organizations across the value chain – from farms and factories to shippers, wholesalers, and retailers – are engaged in a daily balancing act between sharing information and having control over it.

Collaboration Trends Reveal Benefits and Challenges

Hyperconnectivity figured into numerous industry analyst predictions this year. By 2024, IDC saw 45 percent of consumer-facing businesses providing a fully seamless connectedness – with good reason. These analysts said that by 2025 “fully connected enterprises will realize at least twice the return on investment through gains in revenue customer retention, infrastructure longevity, and process and cost efficiencies.”

Forrester researchers found that enterprise data strategy continued to be a top initiative for executives, because “it’s critical in unlocking a firm’s digital transformation — and necessary to take advantage of AI and machine learning.” They predict advanced companies will double their data strategy budgets.

At the same time, Gartner analysts listed “transparency and traceability” in the firm’s “Top Ten Strategic Technology Trends for 2020.” They said highly connected systems in smart spaces will increase opportunities for business transformation but also create new challenges in security and risk.

Encryption Could Balance Privacy Versus Value Equation

In this video interview at the SAP TechEd event, Axel Schroepfer from the SAP Innovation Center Network shared an example of how companies could use homomorphic encryption to share information with partners across a hyperconnected supply chain without compromising data control.

“Suppose you’re a tire manufacturer and a buyer needed 400,000 tires,” explained Schroepfer. “You could use a cloud-based service that calculated the best tire delivery lot size for cost-efficiency and planning for both parties. The beauty of homomorphic encryption is that the original data is never revealed – even within the service itself. This formula-based approach could help companies solve the conundrum of how to gain value from business-critical data without sharing private information between buyers and suppliers.”

A Formula for Collaborative Success

Homomorphic encryption is emblematic of the kind of innovation certain to emerge as hyperconnected business matures. In Schroepfer’s example, the service would use a mathematical formula on top of encrypted data to calculate results without ever seeing the actual data. He saw potential opportunities for this kind of encryption in other areas such as pool buying, where groups of companies collaborate for better prices without sharing internal data. It could also help prevent business fraud.

In a hyperconnected supply chain, partnerships are going broader and deeper, often forging new relationships and sparking business model disruption. While consumer fears and demands about personalization versus data privacy tend to dominate conversations, businesses will grapple with an equally daunting challenge: how to balance an information exchange between buyers and sellers while protecting security and control. The timely delivery of your package depends on it.

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