Impacts on organizational forms, business models and strategies

Abstract

This chapter offers an analysis of blockchain's impacts on organizational forms, business models and strategies. It demonstrates how blockchain-led reduction in the cost of verification and the cost of networking can help promote transparency, build trust and reputation, and enhance efficiency in transactions, which can have important implications on the functioning of organizations. In this way, blockchain can disrupt economies and transform societies. In this chapter we also provide detail discussion of decentralized autonomous organizations (DAOs) that are facilitated by smart contracts. For instance, a DAO could own a self-driving car to use as a taxi 24 hours a day. The income generated would be used to pay for its fuel, repairs and insurance. The money that is saved can be used to replace the vehicle at the end car's life. A key focus of the chapter is also on the effects of blockchain and smart contracts on key mechanisms related to the governance of interorganizational relationships that are employed by participating firms. Specifically, this chapter looks at how formal contracts which focus on economic and legal aspects and relational norms and trust, which deal with social aspects are likely to be impacted by blockchain and smart contracts.