New Jersey-based multinational software development firm Cognizant has released the results of a survey investigating blockchain technology’s role in the financial services industry. According to the survey, which consisted of interviews of 1,520 executives from 578 financial service firms with blockchain experience that varied from novice to expert, collaboration is a significant obstacle to mainstream blockchain use.
“Roughly two-thirds of respondents reported that their firm is working with external partners and with other industry partners/competitors, but 56% cited working with partners/ecosystem members as one of the top external obstacles to blockchain adoption.”
Cognizant’s data remains consistent with recent FinTech industry dynamics. Recently, the R3 consortium has experienced a significant number of its major players drop out of its association. In November 2016, banking magnates Goldman Sachs, Banco Santander SA, Morgan Stanley, and National Australian Bank announced they would no longer be participating in the consortium. According to an R3 Spokesman, "Developing technology like this requires dedication and significant resources, and our diverse pool of members all have different capacities and capabilities which naturally change over time."
Nevertheless, the survey revealed that many industry execs (47 percent) believe collaboration with competitors is crucial to the success of blockchain adoption, as many see consortiums overseeing blockchain initiatives in their respective industries. However, the survey also revealed that many firms are culpable for subdued blockchain growth due to issues like internal conflicts, interoperability problems, and reluctance to share use case data with competitors. Most firms don’t recognize they need to alter their traditional methods of doing business because, according to the survey, only six percent of respondents see cultural change as a key element of adopting blockchain.
Needless to say, many industry leaders might want to conduct a little introspection, as collaboration is becoming more common within a number of other industries utilizing blockchain technology and could ultimately facilitate rapid growth within sectors.
“Collaborating successfully requires participants to have a network mindset, where they are focused on growing the size of the pie and not simply on their own individual slice of the market. With network-based markets, a firm can often increase its margins by including competitors, which adds to the value of the network.”