The blockchain solution that impacted KLM’s intercompany settlement processes
Founded in 1919, KLM is the oldest airline in the world still operating under its original name. The organization has 35.488 employees and a fleet of 119 (excluding subsidiaries) airplanes as of 2015. KLM operates scheduled passenger and cargo services to 145 destinations. In a rapidly growing digital world, KLM has the KLM Digital Studio. The KLM Digital Studio is created to offer explorations of new technologies and innovations to enhance KLMs’ internal processes and discover potential disruptions. As part of the Digital Studio, KLM was exploring the potential impact of blockchain. This resulted in the use case of KLM’s management of complex intercompany settlements between subsidiaries.
As a result of this exploration, KLM Finance set out to use blockchain technology to handle the intercompany settlements process of KLM with its subsidiaries. With the objective to simplify the accounting process in a secure and efficient manner, Unchain worked in close co-operation with the KLM team, to provide the design and implementation of the settlement capability using R3’s Corda technology.
The business value for KLM
The intended added business value is to increase the efficiency in the countless intercompany settlements (ICS) with subsidiaries. This results in a more transparent way of working which is less labor-intensive and error-prone. We were able to deliver real-time intercompany settlements from each business application to the other, without human intervention.
What role did Unchain play?
Our contributions to the project were the following:
- the design of the distributed solution;
- The development of the distributed application on R3 Corda;
- the integration of existing back-end and front-end systems of the customer based on the Unchain Blockchain Gateway;
- deployment of the solution on KLM’s premise.
Let’s hear from KLM’s Innovation Specialist Dominique Vijverberg
“After initial learnings in smaller projects with the Digital Studio, KLM Finance is happy to announce this project, which we see as strategic to simplify our financial processes and to set an example for future blockchain projects that are no longer ‘test’, but have real business impact.”
Potential next steps in KLM’s journey to consortium thinking are connecting more subsidiaries to this distributed ledger-based ecosystem.
Let’s hear from R3’s Revenue Officer Cathy Minter
“Key to Corda’s success is the vibrant and diverse ecosystem of CorDapps. We built Corda to make picking up Corda and developing on it as simple as possible for experienced developers and we actively support our developer community. Unchain’s pilot will open up developing on Corda to even more firms.”
– Cathy Minter