Why 98% of B2B Blockchain Projects Have Failed?
Written by Nick Roquefort-Villeneuve, Head of Marketing – Ondiflo
There are statistics that do not inspire much confidence. When you read here and there that 95 percent to 98 percent of all B2B Blockchain projects have ended up failing miserably far before they got into production, what does it say about Blockchain as a technology? It’s a bit like knowing that your favorite team’s starting pitcher in Game 3 of the World Series is showing a 6.5 ERA… I am involved in Blockchain, and I must admit I have a difficult time comprehending why such a horrendous failure rate. However, I totally understand why PSG got recently humiliated by Manchester United. Money doesn’t buy a Champion’s league trophy. Experience does. Back to Blockchain, failure isn’t my experience. So, I’m been wondering what has been driving so many promising endeavors to the ground.
Here is what I believe has been going awfully wrong:
1. Reaching out for the sky isn’t necessarily wise: There are promises that are actually better left unsaid. The main problem with Blockchain technology was this sudden sprint that consisted in creating a multitude of use cases, as if it made complete sense to migrate every single portion of an organization’s operations to a Blockchain network, while the technology was still in its early stages. And by the way, it still is today. At Ondiflo, our developers had no other choice but to create brand new tools off the chain, so we could build a robust Blockchain-based application for our Oil and Gas partner. This is the reality to which we were confronted. And the other reality is that so many IT departments or startup companies pre-sold a solution before a pertinent pilot was built, setting utterly unrealistic expectations and consequently an inability to deliver. And it’s true that the crypto frenzy manufactured an ecosystem based on irrationality (isn’t speculation irrational, after all?) that felt extremely appealing to corporate decision-makers. They suddenly believed that decentralization was the answer, without taking the much-required time to put things into perspective.
2. A dogma can only go that far: History of mankind has taught us that dogmas and other philosophies don’t necessarily last long. They entice the masses until those same masses realize they are a disservice to them more than anything else. Technology isn’t immune to such phenomenon. To sell a concept on paper is risky. To preach the benefits of a technology that hasn’t proven itself yet is tricky, if not unreasonable. A developer’s dream of disruption doesn’t always fit within the core IT and business needs of an organization. Again, there are so many processes that do not belong to a Blockchain network, and therefore should remain inside a centralized system. When building a use case, developers should inquire about a user’s main pain point and honestly address whether it makes sense to “decentralize” the solution to the problem.
3. Think big but don’t start big: In other words, how about proceeding one step at a time? The decision to deliver a use case in its entirety, without testing the solution one iteration at a time, has proven fatal to a great majority of Blockchain projects. I can guarantee that you will hit a succession of walls. And the reason primarily lies in the fact that this is a new technology that certainly doesn’t have an answer to every problem. As a developer, you need to build a tool that addresses the issue, simply because the answer to the problem still doesn’t exist. Thus, great ideas on paper have been buried on the altar of this insatiable need to speed up the development process, without concerns for crucial details. Blockchain projects should launch at a smaller scale, before moving to the next stage.
Thank Whomever you want for the remaining 2 percent…