Occam's Razor is the problem-solving principle that the simplest solution tends to be the best. In practice most blockchain projects have been far from the simplest thus failing at the first step.
To use Geoffrey Moore's model; Blockchain has not crossed the chasm and, if anything, is stalled at the far left of the "Technology Adoption Life Cycle".
Insurers would better future-proof their business by deploying digital platforms across the customer buying and claims life-cycles and then planning the best use cases for AI powered automation. To meet real problems.
A single digital record for the complete claims value chain is by far the simplest solution for digital transformation.
Not to say that there are not niche applications e.g. in global shipping contracts and insurance where the analogue documents typically only arrive after the containers dock.
For general insurance it is hard to see blockchain providing a simple solution.
The home and car connected by billions of connected devices may appeal at first sight. However, today's blockchains are ineffective data receptacles a vital requirement for IoT platforms.
Keep blockchain on the long-term strategic radar and as a minimum requirement only commit resources when three key principles are met.
- Organisations must start with a compelling problem;
- There must be a clear business case
- Companies must agree to a mandate and commit to a path of adoption
And, of course, you must be able to explain that it solves the Occam problem. It must be the simplest solution.
Emerging doubts McKinsey’s work with financial services leaders over the past two years suggests those at the blockchain “coalface” have begun to have doubts. In fact, as other industries have geared up, the mood music at some levels in financial services has been increasingly of caution (even as senior executives have made confident pronouncements to the contrary). The fact was that billions of dollars had been sunk but hardly any use cases made technological, commercial, and strategic sense or could be delivered at scale. By late 2017, many people felt blockchain technology was either too immature, not ready for enterprise level application, or was unnecessary. Many POCs added little benefit and in some cases led to more questions than answers. There were also doubts about commercial viability, with little sign of material cost savings or incremental revenues.