This is an investigative report compiled from the perspective of an external consulting organisation carrying out the analysis of the impact of the adoption of the blockchain technology by IBM for Sony. The blockchain technology is a public ledger that is completely transparent and it enables secure transfer and ownership of digital units of value by making use of the proof of work method and public key encryption technology. The blockchain technology empowered information system solutions will allow Sony to improve the management of the rights related information and will also enhance the cyber defence system of the business. The confidentiality, availability and integrity of the data of the organisation will be enhanced with this technology and it will also help in addressing the fundamental security aspects preventing the attached like that of November 2014 in future. It is recommended that the organisation should approach the blockchain technology implementation by developing a tailored solution and also address all the regulatory concerns applicable to the company while doing this. In this way, Sony will be able to contribute to harmonizing the cybersecurity framework for the organisations operating in the digital domain.
1.1 Authorisation and purpose
This is an investigative report compiled from the perspective of an external consulting organisation carrying out the analysis of the impact of the adoption of the blockchain technology by IBM for Sony. This report presents an overview, analysis and recommendations for the President and Chief Executive Officer of Sony Kenichiro Yoshida answering all his queries and providing suggestions for making decisions associated with this strategic approach.
This report begins by presenting an overview of blockchain technology and the significant factors associated with the external environment of Sony that will be influenced by the adoption of this technology. The report also discusses any security threats faced by Sony and present recommendations for the technology adoption after conducting an analysis of their portfolio and the offerings by the technology.
Since this report is specifically compiled for Sony, the findings of this study cannot be generalized to any other organisation. The technology landscape is always evolving and developing. The findings of this report are relevant as per the current technological developments and the information and recommendations may change with time.
The blockchain technology is a public ledger that is completely transparent and it enables secure transfer and ownership of digital units of value by making use of the proof of work method and public key encryption technology. There are numerous applications of this technology in the form of cryptocurrencies, for the financial services industry, nonprofit organisations, e-commerce companies and in the art domain. There is no single person who is responsible for the amendment and update of the records of a blockchain and entire information and records are controlled by a community of users. Blockchain operates on the distributed networks enabled by the internet distributed database is the most significant and distinguishing feature of the blockchain technology.
The immutable and shared ledger records all the transactions and keeps a track of the assets in a transparent manner that helps in building trust and has resulted in numerous business organisations adopting this technology all over the world. The business organisations all over the world operate in an interconnected manner and each of them is affected by the actions and decisions of the other organisations and the industry in which they operate. The most common understanding of blockchain technology is associated with its implementation for the cryptocurrencies. However, the concept of blockchain technology and the cryptocurrencies is not the same. Blockchain technology is the basis for the development of the cryptocurrency network where the membership is governed by the various entities in control and ownership of the currencies. The transformative technology of blockchain can contribute to the mode of interaction between the business organisations and the shared ledger develop with the help of it ensures real-time updates embracing the concept of innovation and interoperability. The latest form of blockchain technology is being engineered by the organisations to enable the handling of the extremely dynamic business environment and the ever-changing demands of the organisations (Arun, et al., 2019).
Environmental factors justifying the adoption
Sony is a technology company with a large volume of information of the organisation stored in the digital form. This makes the organisation susceptible to cybercrime, hacking and malicious digital attacks. IBM is offering a digital rights management system to Sony that is backed by the blockchain technology that helps in improving the management, storage, sharing and authentication. IBM is a trailblazer in the field of implementation of the blockchain technology and has developed the information security applications for trade financing, identity verification, foreign currency exchange, event ticketing management and other organisational functions making them safer and more efficient. The challenges and opportunities that come with the adoption of blockchain technology for Sony are discussed with the help of the five forces analysis model in the following section.
3.1 Five forces analysis
Bargaining power of buyers
The blockchain technology empowered information system (IS) solutions offered by IBM are unique and offer significant value to the organisation. Therefore, the buyers cannot exert any influence on these products or their prices.
Bargaining power of suppliers
There are not many organisations offering blockchain solutions and these are not very easily available. The hardware and software for these solutions can be obtained very easily making the bargaining power of suppliers moderate.
Threat of new entrants
Sony is a reputed organisation with an established brand name. There are numerous Information Technology organisations coming up with blockchain technology-enabled solutions but the threat of new entrants to Sony with the adoption of blockchain for IS is fairly low (IBM Team, 2018).
Threat of substitutes
The customers of IT services are always looking for a better bargain. The emergence of these services in offshore locations can result in the customers opting for substitutes making the threat of substitutes high.
The blockchain market is growing with a fast pace and even though Sony is in possession of very high marketing and technological capabilities, it is expected that the organisation will face a lot of competition in future.
3.2 Strategies and goals
The strategies and goals for Sony for the implementation of blockchain technology in its information systems have been identified as follows:
For addressing the privacy concerns and ensuring that, the details of the vendors and other related information is kept private.
For increasing the scalability of the service provisioning.
For making access to information on the information system of Sony more secure.
For the protection of the intellectual property rights of Sony that form the key assets of the company.
For maintaining the security of the proposed enterprise system.
For building employee self-service analytics based on advanced tools for business intelligence.
3.3 Current system and future prospects
The current information system implemented by Sony is susceptible to cyberattacks, data theft and cybercrime. The organisation has previously reported a major cyber attack on November 24th, 2014 when the hackers gain access to the private information 47,000 current and former employees of the company including the social security numbers, salary details, passports, emails, audit documents and other contracts. The organisation is still struggling to develop a balanced strategy for security which enables access to the information to the right people after authentication and even after the deployment of the best quality hardware and software tools, Sony has failed to successfully manage the cyber security threats. Blockchain empowered information system can provide Sony with an effective solution for the management of these threats (IBM, 2018). IBM has had numerous successful cases of use of blockchain technology for improving the working of the organisations belonging to numerous different sectors. The collective knowledge provided to the organisation enabled by the technology allows them to leverage the information and make use of it for creating and sustaining a competitive advantage in their respective industry. IBM will offer the blockchain technology information system Solution to Sony by addressing the concerns associated with the Distributed Denial of Service (DDoS) attacks. The DDoS attack has previously affected the company because of the vulnerability resulting from the partially decentralized information system. The implementation of the blockchain technology will help in complete decentralization of the data and destruction of the editing rights to a few people that will result in a significant reduction of the risk associated with cyber threats and unauthorised data usage (Peppard & Ward, 2016).
4. Blockchain potential for Sony
Blockchain technology enabled information system will allow Sony to practice better information management and develop the enterprise system streamlining the organisational processes and information management practices. The security threats faced by the organisation can also be better managed with the decentralized information management and peer-to-peer information sharing. This prevents the addition of any false data for the modification in the existing information in the records of the company. The complex structure of the blockchain technology also makes the data more secure making the organisation better equipped against cyber threats and fraud (IBM Blockchain, 2017).
IBM has numerous successful cases of blockchain technology application in the organisations belonging to various different sectors throughout the world. The Food and Drug Administration (FDA) of The United States of America has collaborated with IBM to study the implementation of blockchain technology for ensuring the security and privacy when maintaining and exchanging the data associated with the Healthcare records of the people. FDA is planning to develop a transformative solution for the Healthcare industry that enables the patients to access their healthcare data while only enabling the designated members to make additions and amendments and also ensuring that the information is secure, reliable and trustworthy (Lundstrom, 2017). Another successful blockchain empowered technology solution by IBM was developed for CLS, which is the financial institution best in the United States of America. Commercial implementation of this solution is not only expected to increase the cost savings for the company but also help in increasing the efficiency by decreasing the settlement time for the claims and the clearance process followed by the company (Sengupta, et al., 2017).
There are numerous potential uses of blockchain technology for Sony that can improve the process of asset management, fraud prevention, better compliance, improved identity services and the adoption of advance payment solutions. It will support conventional digital content rights management empowered by the public and private ledgers increasing security for the company and preventing the practices of data tampering, data theft and DDoS. The versatile and useful applications of blockchain technology will make the digital content offered by Sony more secure and the scalability and protection officer by it will protect the organisation in future from any internal or external attacks. The payment processing for Sony will become more streamlined with the universal payments solution and fundamental security aspects of this technology will improve the authorisation, authentication and audit process for the company (Moll, et al., 2017).
5. Portfolio Matrix analysis
The portfolio matrix for an organisation is a tool that is used for evaluating the strategic position of all the products that constitutes the portfolio of a company. The portfolio matrix for Sony classifying the product offerings by the company on the basis of the market growth rate and relative market share of the organisation is presented below.
Relative market share
Market growth rate
The portfolio Matrix for an organisation is a tool that is used for evaluating the strategic position of all the products that constitutes
In conclusion, it can be stated that the blockchain technology empowered information system solutions will allow Sony to improve the management of the rights related information and will also enhance the cyber defence system of the business. The confidentiality, availability and integrity of the data of the organisation will be enhanced with this technology and it will also help in addressing the fundamental security aspects preventing the attached like that of November 2014 in future. The repeated threats to the security of the system will be managed with the strategic security plan that is empowered by the capabilities of blockchain for Sony. The organisation can also enhance its marketing and promotion, record management, enterprise operations and payment processing with the blockchain technology (Tapscott, 2016).
The recommendations for the implementation of blockchain technology empowered information system solutions for Sony are presented in the section.
It is recommended that the organisation should establish a clear cybersecurity policy and develop the programs that are tailored to meet the requirements of the organisation.
Address regulatory concerns
An organisation responsible for the management of digital, Sony should develop a clear understanding of the regulatory insights and the implementation should be followed only after the iterative testing of the permissioned blockchain (IBM Institute, 2017).
Contribute to harmonization
The industry players should share the cybersecurity best practices and help in the development of harmonized cybersecurity framework that is consistent and that does not limit the ability of the organisation to innovate while ensuring safety and privacy.