A blockchain smart contract and Oracle-enabled system for cross-border modular integrated construction supply chain management

Abstract

The construction industry plays a crucial role in modern society by materializing the physical facilities that profoundly impact our lives. Nevertheless, the industry faces multiple obstacles in achieving its desired productivity and sustainability. To address these challenges, there is growing interest in modular integrated construction (MiC), an innovative construction technology that can potentially be a game changer. Amongst the many opportunities and challenges of MiC, supply chain management (SCM) is at the kernel, as many countries over the years have shifted their MiC production to offshore/offsite factories to take advantage of their space, cheaper labor, and materials. However, several persistent problems, including unclear information accountability, low information traceability, and untimely and inaccurate information sharing, hinder the full potential of MiC-SCM.

Blockchain “smart contracts” (BSC) and “oracles” could bring about a paradigmatic shift in the cross-border MiC-SCM by mitigating these persistent problems. Nevertheless, the applicability and effectiveness of BSC to the subject area have not been adequately explored. Furthermore, existing BSC-based solutions for SCM were proposed without considering the role of oracles, undermining their feasibility. Researchers require a theoretical framework to explain how BSC and oracles can improve the cross-border MiC-SCM, while practitioners desire a system developed from the framework.

The overall aim of this thesis is to develop a BSC and oracle-enabled system for cross-border MiC-SCM. Five major research stages are designed. Firstly, exploratory background study (EBS) and business process analysis (BPA) are adopted to identify persistent problems associated with cross-border MiC-SCM. The second stage establishes a BSC and oracle-enabled framework for cross-border MiC-SCM using the EBS and design science research (DSR). Thirdly, a system architecture is proposed using the DSR to instantiate the framework. The fourth stage implements the system in a case study. The last stage is to evaluate the performance of the system in a case project using the empirical analysis and evaluation (EAE) method.

It is found that the system can enhance information accountability in cross-border MiC-SCM by achieving 100% checking in offshore production line, cross-border transportation, and onsite installation processes. The improvement of the information accountability saves about 2% of rectification work. Also, the system guarantees the information traceability by shortening the data upload and trace time to millisecond level and guaranteeing zero tampering of data in the project. Lastly, the system ensures timely and accurate information sharing. Hence, there are no process delays and rework due to untimely and inaccurate information sharing.

This study contributes to the body of knowledge on cross-border supply chain, MiC, blockchain technology, and trust-building. Overall, the BSC and oracle-enabled system revolutionizes the cross-border MiC-SCM by digitally assuring the information accountability, traceability and sharing of MiC in the production, transport, and installation processes. The system could help Hong Kong to solve the housing supply problems by building MiC housing faster and safer. The system can also alleviate the bottleneck of construction labor shortage in Hong Kong. It can facilitate the digitization of the construction industry by revolutionizing the MiC-SCM in Hong Kong, mainland China, and the rest of the world.