Many companies struggle to choose the aptest technique to validate their concept and choose between POC, Prototypes, and MVP. In our previous context, we discussed the definitions, applications, advantages, and use cases of these elements. You can find the link to the article here and peruse the write-up for a comprehensive understanding.

It is essential to know that it depends on the business idea or the end product and your target audience (B2B, or B2C, B2B2C); and you may need to use PoC, Prototype, MVP or a combination accordingly.

Idea validation using these concepts will ensure that your final product will enable you to achieve its ultimate goal.

A PoC can usually provide a direct response to whether the concept will be viable or not for the target audience. Idea feasibility will be measured here, and with the comeback, you can decide whether to proceed with the existing plan or not. Furthermore, a PoC can help convince your initial pre-seed investors that your concept can be implemented and is technically viable.

On the other hand, MVP enables companies to grasp information about the target user's experience and respond to the core business purpose of the application. The insights received from actual users helps to validate the overall objectives, identify the user pain points, and address the issues over time.

If you want to present how exactly your final product will look like, or manifest the main design elements, prototyping is the best way to give the big picture to the end user. It further helps to run multiple test areas while saving your resources. If you are looking for investors to work on your project, a tested prototype is the best way to demonstrate and pitch your product.

Should PoC, Prototype, and MVP be Throwaway Builds (Minimum Initial Investment)

It is always better to look at PoC and MVP as throwaway codes. If your business idea takes momentum and finds traction, it is vital to build everything from scratch with architecture and design to cope with it for the next 3 to 5 years. 

For PoC, think of the least expensive way to implement. Typically, when developing a PoC, factors like  product scale, architecture, UI elements are not considered. Instead, the requirement is to check on technical feasibility and customer feedback on your new product idea or a particular feature.

With all things considered, your PoC will be a hardly scalable piece to turn out for something decent. Hence, it is better to consider it as a throwaway build.

In relation to prototyping, it can be either a throwaway or a part of your final user interface, depending on the model type you select. For example, you can use rapid throwaway prototypes to receive user feedback and discard it later. These models are used to validate the system functionalities and requirements. Hence, it needs to be removed as it does not add any advantage to the final UX/UI elements.

For MVP, you may have to build in a way that could cope up with the demand for the next 12 to 18 months (Not a rule of thumb, but empirically proven ). It is common to see startups control the growth without hurting long term plans to build the post MVP version. However, for the long run, it is essential to opt for a complete rewrite ensuring your final product can have flexibility, extensibility and adaptation with upcoming technology and supplementary changes.

A Guide to Choose from Poc, Prototype, and MVP

Exhibiting a decision matrix using a table. - includes questions and scores for users to choose the correct method for their products.

Check out the reference tables at the end of this article.

Decision Matrix

Parameters	POC	Prototype	MVP
Use Case	For Technology/Market/Behavior disruption (completely new idea, so need to prove a concept is viable to build)	To verify user journeys and messaging in a solution are understood by the intended users. Save time and money. Could used to attract seed funding	Get actual users to use your solution to solve the identified problem. Evaluating your solution solves the problem in an acceptable manner. Gather feedback from users to improve upcoming versions of the solution. Aim to the initial target audience response
Purpose	To verify technical/market/behavioral assumptions before getting down to development. / To clarify which way to go with the development. Convince internal stakeholders	Make the application usable for its intended users. To assure that the end users could navigate and get the job done using the solution. It is the working model of several aspects of your product. Prototypes help make decisions about product development and reduce the no. of mistakes and waste.	To prove, your solution is effectively solving a problem and it is effective enough for the customer to pay for solution.To get the minimum version of the product to the market
Form of implementation	Most rudimentary implementation to prove the relevant disruption is viable to implement	High or Low fidelity Wireframes/UI, users could navigate through different screens but nothing has been implemented	Usable solution by its real user, just to solve the identified problem (nothing more, nothing less)
Target audience	Internal users (Decision makers about the project GO/NO GO)	Specifically selected sample of target audience (real users). Should be able to access more than once to verify the prototypes (should be able to involve with iterative process of prototype building)	Sample of target audience. Easily accessible, Give genuine feedback. Test the product with a pre-selected potential customer group
Cost	Less budget and is ideal to collect internal funding. Might have to invest on new tools and accessories.	Much less cost to build the prototype compared to PoC or MVP. More time/resources spent here saves time/resource at the expensive development phase	No compromise on quality as the end product would be used by real users. Cut the cost by reducing features, not the quality. Well-defined budgets and looks for investment
Human Resources	Requires technical experts to develop the basic concept. Could involve tech related R&D	Less technical resources as no coding / development is involved. Need to recruit testers, Iterative design processes	Here you are developing the actual product (at a smaller scale with less features) So needs full technical expertise
Risk Evaluation	PoC involves the highest risk or all. But lessen the risk in upcoming phases.	Reduce the risk in terms of user satisfaction in product navigation	Reduce the risk of losing time and resources of the full scale development
User Interaction	N/A since is its used internally	Gives an overview to the end user how the end product will look like with basic elements and navigation. Highly interactive with users but without real functionality.	Full user interaction. UI/UX, Key Functions and even feedback from users also a part of interaction
Apparent time to create	If you have several options or if you uncertain about the feasibility of the concept	When you are confident about your idea and needs to start and test the design process	When you are positive about the idea and the design, and ready to launch it to the market
When to Show the investors	Pre-seed / Seed	Pre-seed / Seed	Pre-seed, Seed, rarely for Round A
Cashflow	Negative (expenses only)	Could leads to Positive cash flows from Investors (Seed level)	Should lead to Positive cash flows from service revenues & Investors
Extended use	Can be used to develop MVP	Output can be used to develop the solution. No waste. If the prototype consist of UI design, it could be used for the development	Can be expanded and used for the full version of the product. You may have to throw away the code (Do not hesitate to do so)
What you should not do?	Invest time/resources to make the PoC usable to others.Implement things that have been already proven	Use placeholder content or graphics. Train/Assist testers. Test how UI/UX work on real environment	Compromise on quality Implement extra/supplementary  features
Outsource or in-house work	At this stage, you are working on an idea to check out its possibilities of turning it into reality. Hence, it is ideal to do in-house to ensure that your concept would not be revealed to third parties /competitors.	Prototypes can be fully outsourced as they will be exposed to the public for test-run purposes.	MVP can be done internally or with the contribution of a third party. A mixed team is preferred here to build up the product. Here, the expertise (outsource party) can help with the best techniques while the in-house team is conscious of the progress/development plan.

Final Take Away

Building a solid foundation is essential to deliver a successful software product. Your PoC, prototypes, and MVP will be your foundation for the process, with actual feedback. They will help you to iterate the product process and enhance the features to meet the user requirements or the ‘real-needs’.

However, software product development is not limited to paying attention only to the initial process but is involved with many crucial steps that need to be considered throughout the proceeding. With that note, the next phase of the development process will be discussed in future articles.

The development of a successful software product requires excellent preparation with a series of steps. Brainstorming, planning, incorporating ideas, designing, QA are a few actions that are involved with the proceeding of product development. Each step helps to validate the stability and the effectiveness of the final product, and hence it is crucial to give equal attention every step of the way.

This is the second of our series of articles where we look into the basic elements that every expertise considers before developing a comprehensive software product. If you would like to keep up from inception, check our first article using the link below.

Link to our first article – The Essential Guide to Software Product Development.

If you are involved in a startup that is based on a new software product, these articles can help you understand the basics of how to go about it in the most economical and methodical way.

Disclaimer 

This is based on 20+ years of experience in software product development. After seeing projects succeed, fail, survive, happy clients, angry clients etc. Encountering a mix of positive and negative things has helped this article to chip in a balanced view. It will further assist to learn how to succeed or fail with minimum damages or minimize disasters.

Significance of Software Development for Businesses

Software products have become one of the crucial needs to enhance and upscale any business. Automation of processes through software development helps to cut downtime and manual techniques for a smooth operation.

Streamline of internal functions, improved client experiences, feature-rich additions to the market are some top-notch features of software products that have made it super consumer effective while growing its popularity in every industry. 

Problem Analysis

When you boil it all down, you will notice that the initial step of software development is identifying the problem. In other words, the need for a software product comes with addressing a particular issue. 

Identifying and addressing the problem will ensure that you have developed the right solution as a software product. However, it is also essential to reckon that the problem and the requirements can be transitory and are likely to change over time. 

Looking into the end-users or the target market is another critical point here. While collecting brick by brick for the development process, it is essential to pick out where your final product is going to fall. This could be Business-to-Business (B2B), Business-to-consumer (B2C), Business-to-Business-to-Consumer (B2B2C), or an internal software product development.

Once you have identified the problem and where the final product falls, take notes and put it out in a writing document to present for a group of people or your team. This allows you to receive multiple perspectives and dig deeper to understand the root causes that affect and manifest the main problem.

Pinpointing the primary problem, connecting the contributing factors, identifying the affected people (Eg, project sponsor, customer, user, management), defying the scope of the solution, and recognizing the solution constraints helps to analyze the problem, understand the affected areas and address them accordingly. 

Idea Validation

The ultimate goal of idea validation is gathering evidence that your project will end with a paying customer or increase efficiency (to save time or cost). It helps to see the viability of your concept and how it will work in the real world.

Idea validation helps to reduce risks, speed up delivery and minimize costs. Below are a few questions to analyze the demand for your idea or to determine what the final product will achieve.

1. Are you targeting the right audience with the correct problems?
2. Can the final product help customers/users get their jobs done?
3. How often do they need to use the product?
4. Can your app solve a problem in a new way? Or is their innovation involved?

Setting up measurable and clear objectives is essential to determine how the idea will validate in the real world. In addition, formulating a hypothesis, developing a value proposition further enables you to get a clear answer.

PoC, Prototype, and  MVP

A substantial part of idea validation is covered by following three main ways; use of a Proof of Concept (POC), Prototypes, or a Minimum Viable Product (MVP).

To make it more comprehensible, check out these working definitions for PoC, Prototype, and MVP.

PoC- Works in a controlled environment with a set of preconditions. Typically, a PoC is operated by the technical team and cannot be used by the outside world. However, PoC helps to demonstrate the core challenges or the processes for a particular problem can be addressed using the solution proposed.

Prototype- Gives a clear picture of the design and the user journeys  of the application to make sure end-users could use the application conveniently. Users can mainly see the UI/UX aspects here but not the internal functionality.

MVP – A segment of the target audience will  use MVP to solve a real-world problem. An MVP is bound with limitations and may not have many features. But the core functionality can be used to benefit from the system.

Depending on the situation, software companies use PoC, Prototypes, MVP or a combination to validate and receive feedback for the final solution.

Proof Of Concept (POC)

A PoC helps to pursue ideas before approving them for further testing. It helps to identify the feasibility of the concept and identify potential issues that may affect the final product’s success. Using a PoC, you can determine whether the product can feasibly develop to solve the problem you are trying to solve.

For the most part, a PoC is developed internally in a controlled environment and cannot be assembled or changed. It is a skeleton of the final product with minimal features to test out and distinguish how it will work in the real world.

Given below are a few advantages of developing a PoC during software development.

• It helps to choose the most appropriate technology for the development process.
• Simplify and improve the software functionality
• Receiving valuable feedback before building the actual product
• Potential to get onboard clients before official product release
• Avoid costly mistakes
• Increases the chances of commercial success

Prototyping

A Prototype is an iterative process that is used to ascertain the UI/UX aspect and visualize your product to validate the user journeys. It will demonstrate the critical design elements and the user flows using wireframes and storyboards. It helps define the features that need to be included and makes up a model to expose the errors in studying and designing.

Typically, there are four prototyping models, namely, Rapid, Evolutionary, Incremental, and Extreme. In most cases, following a PoC, a prototype is used to obtain further details of your final product and to see how it looks and users would use the features in the end. 

Identifying customer needs, enhancing product workflow with better understanding, identifying design and related mistakes are a few advantages of prototyping in your early product development process. 

Most importantly, you can also use it as an opportunity to reach the users at an early stage and get their feedback before putting your product into the market. 

Credential App

Reader App

Link to walkthrough a sample prototype

Prototype of Credential App – Live demo

Prototype of Reader App – Live demo

Minimum Viable Product (MVP)

Typically, before releasing a full-fledged product, an MVP is used to collect feedback from early customers. The responses from the real world help developers to work on the versions and improve the product accordingly.

An MVP consists of the core features and the minimalist design that deploys the final product. The basic infrastructure is developed using the least possible expenditures and has certain limitations. Positive and negative feedback received from MVP help validate the idea of the final product and see the potentiality of its success. It can also be used to solve an existing problem or could be used to improve the efficiency (cut down of effort taken, time taken, or cost involved) of a task.

MVP introduces efficiency to a selected task (core problem your application solve), and there could be many other auxiliary features that could improve the efficiency of the same job. But with the MVP mindset, you will not try to include those complementary features in the solution you provide at the MVP stage. So, again, that’s why we call it MVP. Solve the intended problem, but nothing more, nothing less.

There are different types of MVP concepts that can be used based on the purpose. Software prototypes, product designs, concierge, landing pages, piecemeal, demo videos, and wizard of Oz are  some of the main ways the MVP concept is used. Dropbox, Amazon, Airbnb, and Facebook are a few well-known examples that started with the MVP technique.

Below are the key advantages of using MVP.

⦁ Avoid lengthy unnecessary work
⦁ Gain insights on product viability and usability
⦁ Saves project time and money
⦁ It gives clarity around the final product idea
⦁ Analyze market demand

When you disregard all non-essential features, that brings the time to market your product less and cost to develop your product less. These are the pillars of lean product development.

Choosing between POCs, Prototypes, and MVPS could be crucial to find the aptest solution for your business proposition. Furthermore, after considering all these essentials, you could decide on selecting them as throwaway codebase elements or not. Hence, our preceding context will discuss the guidelines and the necessities to choose between these elements.

We want to thank Chalinda Abeykoon for being a part of this effort and adding value to this article by sharing his insights and experience.

Stay tuned for our next article.

Iper Direkte AS is a Norwegian-based marketing company that provides up-to-date marketing-related information about consumers and businesses to interested parties. The type of information they provide includes personal, property, vehicle, and more. Iper uses a powerful matching system to identify and extract the above information to be used by its clients.

Software product development is an avenue with immense potential across a range of industries. However, with these ample software product development opportunities comes concerns that businesses might not think about or fully understand before developing their software.

There are common issues, such as increasing customer demands and limited resources, as well as issues that are specific to your business that can be solved using software products or platforms.

These software products and platforms can help your business succeed in two primary ways. First, they can help you expand your business through various means such as improved marketing and outreach or even analysing data for new markets your business could fit. Second, they can help increase your business’ efficiency leading to a larger profit margin allowing you to direct your revenue towards more growth.

So, as the first step to our series of articles, we will guide software product development and introduce the opportunities that await your business within this field.

Disclaimer

The information discussed in this article bases its report on 20+ years of experience in software product development. This assessment comes from two decades of watching projects succeed, fail, survive, produce happy clients, and angry clients.

Therefore, this information will provide you with a mix of positive and negative aspects of software product development. This overview is purposefully inclusive, providing a balanced view of succeeding or failing within this endeavor with minimum damage or minimized disasters.

Why Should You Build a Software Product?

There are many reasons why a business would opt to build a software product. Despite the vast differences in building a software product and most traditional retail products, the reasons for making your software product are similar to creating any other product or business:

• You have an idea for a new project: If you have an idea for software that solves a problem more efficiently, you could have an entirely new project idea, with the core of the project being increasing the efficiency of your business.
• You have an idea for creating a support service: If you have an idea that will help save time, money and ultimately leads to better profitability within your field, or even within another area, that could be a seed to build a software product around that.
• You need software to suit your unique needs: Most of the time, people create software and other inventions or upgrades based on their needs. Sometimes, out of the box products do not suit your unique needs. While it still might be cheaper to create a workaround to manage this issue with the out of the box option, sometimes that is not possible. Therefore, it is worth the time, money, and effort to save yourself (and others) these headaches in the long run.

How to Start a Software Product Development Project?

Starting a software product development project is not an easy feat, regardless of the tools and options you have at your disposal. However, it certainly does help to know that you do have options. You do not need to start from scratch as there are primary resources available for nearly any kind of software you intend to develop.

Here is what the technological world has to offer as cornerstone options to kick off your software product development:

PoC

Proof of Concepts (PoC) help you prove that your software will work in the real world. This demo system simulates real-world stressors on a concept to ensure the real version of the conceptualized design will perform as designed.

This environment test helps prove that the concept will work, before the time, money, and energy gets invested in creating the real deal.

MVP

Minimum Viable Product (MVP) is a resource that decides whether your software product can actually solve the problem you intend to solve. MVPs are especially important with software development because it tests the idea of change versus need. MVP will determine whether your software is solving an actual problem your end users are experiencing and if they’re willing to pay for that solution.

Throw away vs. Built to scale

Throw away and Built to scale are two fairly self-explanatory methods to start your software product development.

Throw Away Software

Utilizing the throw away approach to starting your software product development means you built either a PoC or MVP you know cannot be turned into a commercial product. It’s typically built with minimal time and resources purely to test your idea. Once you’ve tested your idea, you’ll need to completely scrap all previous development and rebuild the software product from the ground up. This allows you to confirm you have a strong idea for a software product without wasting time or resources.

Built to Scale Software

Much like the name suggests, built to scale software is a product and resource that should grow with your business needs.

While a throw-away software build is a bandage, build to scale software is a skin graft. There are many opportunities within the build to scale software development because it intends to evolve and thrive even though the upfront costs are higher.

Should You Use a Throw Away Build or Scaling Build for Your PoC or MVP?

A lot of throw-away builds are specifically for PoC or MVP. These builds require minimal time and investment, as they are only demoing your concept. If your idea for your software product is unique or completely new to its target market, then building a throw-away product allows you to test your idea with minimal resources.

However, most software product development projects should start with scaling in mind. Built to scale software does take a moderate initial investment but pays off if you continue because you have already laid the groundwork for the actual product, instead of just a demo. If the solution you are building revolves around a proven business model, then using a scaling build will allow you to grow it faster as you’ll already have a usable code-base.

Decide Your Tech Stack

Besides having options for creating concept designs, technology advancements also offer you different options for your preferred tech stack.

Using similar Open Source projects Vs. Built from scratch.

The foundation of your software will come from two broad options:

Open Source Projects: Open source projects are created by other software developers or coders who have shared their work with the general public. If you can find an open-source project to help frame your software development code, you can cut out a lot of initial time, money, and resources.

Pros of Similar Open Source Projects:

• Low initial costs
• Highly reliable (not every project, but you could easily figure out the quality)
• You still have the flexibility to make it yours.

Cons of Similar Open Source Projects:

• There are potentially long-term costs needed to keep it running.
• Would not match with your exact requirements
• It could pose serious security risks.

Building from Scratch: Exactly how it sounds, building from scratch creates an entirely new code without any business specific foundation to start you off.

Native vs. Cross-Platform

Building your software product as a Native or Cross-Platform solution will be a decision that you need to make if you are creating an app for mobile devices. Thankfully, the basic concept of native and hybrid software development is relatively easy to understand.

Native: Native app design is when everything for that app is designed specifically for one operating system (iOS or Android.) While you can create an app for each platform, you will have to deal with multiple code bases instead of one.

Cross-Platform: This option of app development ensures one code base produces an app for each operating system.

Remote vs. In-House Team

Remote work is becoming more commonplace, but there is still a notable divide on whether you should hire a remote team or keep your development team in-house.

Remote Team

Hiring a remote team in this context means you are outsourcing your software development team. Therefore, remote resources are all contractors who don’t work for your company, even though they can be bound to secrecy and nondisclosure, depending on your agreement’s arrangements.

Pros of a Remote Team:

• Low cost (usually one third compared to inhouse)
• Minimum commitment (you could terminate your contract easily)
• Quick kick-off
• Fast turnaround
• Diverse tech skills (on demand)

Cons of a Remote Team:

• Their commitment to you can also be minimal.
• More of a security threat
• Could just disappear without finishing the job

In-House Team

Creating an in-house team is an investment. Chances are, if you are developing an in-house team, you are expecting to be in it with the same people for the long haul.

Pros of an Inhouse Team:

• Easy Communication
• You get to know their work habits.
• You have more control over their loyalties.

Cons of an Inhouse Team:

• High cost due to:
  • Full-time (or Part-Time) Salaries
  • Other Benefits
• Difficult to find skilled resources
• Takes a long time to build an effective team.

Make Your Software Future Proof

Of course, no one knows what the future holds but by making an effort to future proof your software product before you spend too much money and time developing it. Here is the best way to future proof your software development:

• Validate the idea with minimum cost
• Your project may or may not succeed but invest time to think about both scenarios before kicking off the project.

Where Can I Find More Information on Software Product Development?

This essential guide to software product development provides all of the basics you need to kick-start your software product development efforts. Of course, there are an extensive set of details to each section of this guide that will help you develop your software product in the most efficient and effective way. So, we will be creating future guides to each specific aspect of this overall guide you can utilize for a comprehensive look into software product development and how it can help your business thrive.

Link to the next blog – PoCs, MVPs & Throw Away Codebases for Software Product Development

In software development methodology, with the thought of “How to make an idea into a reality,” the agile method is the first thing that comes to mind to step up into the process. In simple terms, agile is a set of values and principles that teams can use to make decisions on developing software.

Evolutionary project management and software development methods can be traced back to 1957 where heavyweight methods were used in the development process. Lightweight software development methods started to evolve in the 1990s with different executions.

The traditional waterfall or the incubate method takes a lot of time and work and is often described by critics as a micro-managed and overly regulated methodology. The collection was inclusive of 17 software development methods where the developers met in 2001 and published the manifesto of Agile Software Development.

Overview of Agile

With the publication of the manifesto for agile software development, four values were outlined by the Agile alliance. These values enabled a faster process, excellent customer collaboration, adapt and revamp planning and put people before processes. The values are:

• Individuals and interactions over processes and tools
• Working software over comprehensive documentation
• Customer collaboration over contract negotiation
• Responding to change over following a plan

Furthermore, it was finalized with 12 development principles. These fundamentals help user involvement and a cooperative approach where stakeholders can monitor and examine the progress of their products. It further helps in identifying issues during the development process and gives assurance of achieving satisfying expectations. The 12 agile software development principles are;

1. Customer satisfaction with prompt delivery of valuable software.
2. Welcome changing requirements, even in late development.
3. Deliver working software frequently in shorter springs
4. Close engagement and collaboration between business people and developers
5. Projects are built around trusted motivated individuals
6. A face-to-face conversation is considered as the best form of communication
7. Working software is considered as the initial measurement tool of the progress
8. Sustainable development  is used to maintain a constant pace
9. Constant attentiveness to technical excellence and designing
10. Use of simplicity and maximizing the amount of work not done is required
11. Use of finest architectures, requirements, and designer ideas.
12. Regular effectiveness and adaptability of the team for adjustments.

How Agile Has Gone Mainstream

The methodologies and applications of agile have led to the mainstream in software development with proven results in making efficient and effective products. The diversification and constant changes in technology have raised the need for flexibility and adaptability of software to meet future changes. With agile, products were engineered and developed in a way that they are nimble enough to adjust to the changes and the businesses.

The global competition in every industry to develop the best user-friendly and feasible product keeps rising with numerous attempts from all corners of the world to deliver the most refined technology solutions. Hence, business owners often prefer a method that can create a more durable, flexible product to beat competitors. The practices used in agile methodology come in handy here to deliver a top-notch solution.

With the Agile method, practices like MVP are used to get faster test runs and feedback from users before developing the complete solution. This helps to receive an assurance on the strategies used and to receive an idea of the success rate of the ultimate expectation to build up the business value.

The stakeholder engagement before, between, and after each sprint results in higher collaboration and helps to deeply engage in the project, which eventually results in delivering a high-quality product. It further helps in transparency where clients can be involved in prioritizing features and other changes with the right guidance and understanding in each review session.

The agile method of software development also helps in improving quality by breaking down its units where the team can focus and concentrate more on each section with testing and reviews. It also helps in finding defects easily and quickly and figuring out the mismatches that need to be altered accordingly.

The powerful tool of agile consisting of components such as project planning, roadmap creations, sprint planning, sprint reviews, and retrospective helps every participant to enhance the product quality in terms of control, flexibility, adaptability, etc. The testing methods help in developing a product speedily and cost-efficiently while focusing more precisely on the final goal. It helps to overcome pitfalls like scope creep and waive off the unnecessary costs while engineering the product.

Practicing these methodologies helps the development team to work collaboratively with higher transparency to deliver a product with a higher success rate. It further aids in developing software that is nimble enough to adjust to future changes and requirements in the business.

It is essential to find a team that follows these practices and principles of agile correctly during a software development process to deliver a high-quality, superior product. At Fidenz, we have a proven record of building successful products with the right strategies and implementations. If you are looking for a software solution to upscale your business, contact us to receive the best consultation on product development with agile methodologies. Our team can provide you with robust software solutions that can serve your organizational goals and adapt to future changes along the way.

The term blockchain is often misinterpreted as a single-use for cryptocurrency and bitcoin transactions. However, the application has not been limited to these two and has numerous other uses in diverse sectors. This article will look into a few real uses of blockchain and how it can revolutionize technology benefiting different industries to enhance their work.

An Overview Of The Blockchain Technology

A blockchain is a type of a database that collects information or stores transactional records in groups or in other words “blocks”. When these storage capacities fill, they are chained into the previously filled block, forming a “chain”. With its most prominent usage in cryptocurrencies, the storage is often called a digital ledger. This information stored here is highly secured, and each transaction is authorized by a digital signature authenticating the transactions. The following characteristics of blockchain technology have made it immensely popular over time, diversifying and multiplying its uses.

Decentralized system  : Unlike the conventional methods, blockchain transaction takes place in mutual
                                                   agreement of users.

High Security                  : The digital signature feature has made fraud transactions and data corruption
                                                   impossible.

Automation Capability: The technology is programmable and can generate automatic system actions, events,
                                                   and payments.

Uses of Blockchain Technology In Different Industries

Applications in Financial Services

Embracing the blockchain industry in the financial sector has enabled us to lower the expensive mistakes that come with human errors, operational risks and streamline each process. The blockchain applications in financial trade allow recordkeeping, onboarding, security, privacy, data management, and trade processing secured and efficient. Features such as digital document authentication enable real-time verifications and collation of user activities. The tracking and enforcement of regulatory controls facilitate the collateralization of assets. Digitizing the lifecycle of finance with blockchain applications can enhance the overall security and efficiency of every subsidiary process.

User Identification Process / Digital Identity

The need for companies to comply with Know Your Customer (KYC) policies has become crucial over time. The guidelines enable financial sectors to manage risks prudently and prevent activities like money laundering. In order to meet user identification standards, blockchain can facilitate a standardized network of identification information. The data can be stored and accessed securely and validated in record time. The digital identity applications through blockchain can be used in many sectors, including finance, health, education, travel, etc.

Blockchain-Based Cloud Storage

Cloud storages have numerous advantages, which include usability, easy access, automation, cost-efficiency, synchronization, convenience, etc. However, some may find cloud computing problematic with the risk of cyber-attacks. Integrating cloud storage with blockchain can carry off the problem with its extremely secured segments. The data of blockchain-based cloud storage is divided into many encrypted segments and are interlinked through a hashing function. The decentralized locations and security provisions assure reliable and robust security against hackers. Further, they do not hold the data on a node and hence help owners to retain their privacy.

Smart Contracts

With an objective of reduced intermediates, fraud losses, enforcement costs, arbitrations and other accidental exceptions, smart contracts are used to execute and control agreements. These contracts include legally relevant events and actions with the terms between the buyer and seller written into lines of code. The smart contracts are available as a computer program or a transaction protocol, and the codes control the execution while making traceable, transparent, and irreversible transactions. The self-executing contracts permit trusted contactors and transactions even among anonymous parties without the requirement of a centrally authorized legal system.

Blockchain For Logistics

Blockchain solutions for the logistics industry can provide extra transparency and clarity to all of its stakeholders. The applications can allow documentation and recording in a digital platform, making it incorruptible. The important paperwork can be stored in the form of digital copies and used for updates in the future. It can further track the financial transactions, record them, make POs, custom duties, and other work easy. Record of temperature zone is another key feature of blockchain for cold storage supply chain operations. This helps in improving safety movements and reducing disease spreading. Serial numbers, bar codes, RFID tags, and products are a few hardware tools that can be digitally linked with a blockchain tracking software.

Apart from these, blockchain is used in IoT, voting mechanisms, real estate, royalty tracking, and many other related industries. The improved security system using cryptography has enabled blockchain to mark its territory in many sectors.

If you are looking forward to using blockchain in your organization and strengthening your business’s core system, contact us at Fidenz Technologies for ultimate solutions. Our team of professionals is happy to help with all your software concerns.