Previously, we've reviewed some applications of smart contracts. Now will walk you through what Nick Szabo recommended to managers in his white paper on smart contracts that he did for us at the Blockchain Research Institute. Here's our take on five of his suggestions for deciding whether blockchains and smart contracts can help you in business. First, audit your organization's business processes for measurable changes. Look for conditions of performance you could verify by sensors or computers. These could include, payments, financial arrangements, logistics, checkpoints, and tasks involving time, and distance. You could use smart contracts with oracles in these cases. Second, if you're coordinating activities across borders, consider using public blockchains rather than private ones. The security of public blockchains depends on computer science rather than on local law enforcement. That makes them more reliable and less susceptible to human interference or worse corruption. Mature public blockchains are securely permission-less and seamlessly global. Those qualities make them more secure and reliable under a whole variety of conditions be they local, regional, or international. They also help you expand your global reach. Third, if you'd like to reduce your need for intermediaries for verifying identity or adapting to local laws, then smart contracts could help. Make your business processes less like a bureaucracy both internal and outward-facing. Make them more like a vending machine. That means few to no forms to fill out, more metrics to call on and respond to. You're not imposed the risk of identity theft on your stakeholders as lots of other organizations impose on theirs. You'll also reduce your legal risks. You may even increase your reputation as a stress-free, worry-free party to do business with. Fourth, consider hiring lawyers who know computer science, and software engineers who know law. Ask them to collaborate on codifying the basics of your business relationships. It's important for your lawyers and software engineers to know the strengths and weaknesses of each other's approach. Software engineers will benefit from knowing the history of contract law and practice. Fifth, if you'd like to shrink payroll and increase your business flexibility, then consider converting some or all of your employment contracts into independent contract or business outsourcing contracts. If you can verify performance of certain employee tasks with measurement rather than human judgment, then this could work for you. It allows you to outsource more tasks as you need them completed, measuring performance, stresses, best practices. It also opens up competitive bidding for those tasks. This is especially useful across national borders. Businesses hire employees when contracts can't possibly cover all the tasks that they may need to do or perform. Instead, they assign tasks on the fly. So whoever on staff is available and qualified, gets to do it. Once you can codify and measure an employee task, you can restructure your contractual relationship with the person completing it. Those are five of 10 suggestions that Nick made in his white paper. We encourage you to read the rest and how they might apply to your own business.
