IDEAS home Printed from https://ideas.repec.org/a/eee/tefoso/v174y2022ics0040162521004911.html
   My bibliography  Save this article

Re-designing the pension business processes for achieving technology-driven reforms through blockchain adoption: A proposed architecture

Author

Listed:
  • Sarker, Indranil
  • Datta, Bidisha

Abstract

High administrative costs and associated operational inefficiencies present multiple challenges for pension industries across different countries. Although blockchain is considered a potential solution for these concerns, the pension industry has not fully leveraged this disruptive technology. This paper provides a blueprint for a blockchain-based end-to-end digital transformation of the pension industry. First, we identified the pre-requisites for blockchain adoption in pension. Then, we developed an architectural design of blockchain-based re-designed pension business processes. Subsequently, we elaborated on how smart contracts can make pension transactions in such redesigned processes optimized, automated, and error-free. Finally, we presented how blockchain can be integrated with the existing pension IT systems, using an API layer, to enable seamless onboarding of all pension participants to a single digital platform – a critical ask for any blockchain implementation. We concluded with an elucidation of the potential of such blockchain-based digital transformation of the pension industry in reducing turnaround time, lowering operating expenses, and facilitating the achievement of other pension reform agendas. This architecture of a blockchain-enabled pension network represents a flexible and scalable knowledge construct that can act as a foundation for further investigations by pension regulators or pension industry participants interested in achieving technology-driven pension operations reforms.

Suggested Citation

  • Sarker, Indranil & Datta, Bidisha, 2022. "Re-designing the pension business processes for achieving technology-driven reforms through blockchain adoption: A proposed architecture," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    • Handle: RePEc:eee:tefoso:v:174:y:2022:i:c:s0040162521004911
    DOI: 10.1016/j.techfore.2021.121059
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0040162521004911
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.techfore.2021.121059?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Chang, Victor & Baudier, Patricia & Zhang, Hui & Xu, Qianwen & Zhang, Jingqi & Arami, Mitra, 2020. "How Blockchain can impact financial services – The overview, challenges and recommendations from expert interviewees," Technological Forecasting and Social Change, Elsevier, vol. 158(C).
    2. Aleksandar Andonov & Rob M.M.J. Bauer & K.J. Martijn Cremers, 2017. "Pension Fund Asset Allocation and Liability Discount Rates," Review of Financial Studies, Society for Financial Studies, vol. 30(8), pages 2555-2595.
    3. Rameshwar Dubey & Angappa Gunasekaran & David J. Bryde & Yogesh K. Dwivedi & Thanos Papadopoulos, 2020. "Blockchain technology for enhancing swift-trust, collaboration and resilience within a humanitarian supply chain setting," International Journal of Production Research, Taylor & Francis Journals, vol. 58(11), pages 3381-3398, June.
    4. Kopyto, Matthias & Lechler, Sabrina & von der Gracht, Heiko A. & Hartmann, Evi, 2020. "Potentials of blockchain technology in supply chain management: Long-term judgments of an international expert panel," Technological Forecasting and Social Change, Elsevier, vol. 161(C).
    5. J. A. Bikker & J. Dreu, 2007. "Operating costs of pension schemes," Springer Books, in: Onno Steenbeek & Fieke Lecq (ed.), Costs and Benefits of Collective Pension Systems, chapter 4, pages 51-74, Springer.
    6. Christie Smith & Aaron Kumar, 2018. "Crypto‐Currencies – An Introduction To Not‐So‐Funny Moneys," Journal of Economic Surveys, Wiley Blackwell, vol. 32(5), pages 1531-1559, December.
    7. Bikker, Jacob A. & De Dreu, Jan, 2009. "Operating costs of pension funds: the impact of scale, governance, and plan design," Journal of Pension Economics and Finance, Cambridge University Press, vol. 8(1), pages 63-89, January.
    8. Whitehouse, Edward, 2000. "Administrative charges for funded pensions: An international comparison and assessment," MPRA Paper 14172, University Library of Munich, Germany.
    9. Ninel Botezatu, 2017. "Development Opportunities for Non-State Pension Funds in the Republic of Moldova in the Context of Digital Economy," Fostering Knowledge Triange in Moldova: 2017 Conference Proceedings,, Academy of Economic Studies of Moldova, Centre for Studies in European Integration.
    10. Niu, Baozhuang & Mu, Zihao & Cao, Bin & Gao, Jie, 2021. "Should multinational firms implement blockchain to provide quality verification?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 145(C).
    11. Hartley, Janet L. & Sawaya, William J., 2019. "Tortoise, not the hare: Digital transformation of supply chain business processes," Business Horizons, Elsevier, vol. 62(6), pages 707-715.
    12. Barras, Richard, 1986. "Towards a theory of innovation in services," Research Policy, Elsevier, vol. 15(4), pages 161-173, August.
    13. Horst Treiblmaier & Christian Sillaber, 2020. "A Case Study of Blockchain-Induced Digital Transformation in the Public Sector," Progress in IS, in: Horst Treiblmaier & Trevor Clohessy (ed.), Blockchain and Distributed Ledger Technology Use Cases, pages 227-244, Springer.
    14. Beena Amir Mehsud, 2015. "Impact Assessment of BPR on Federal Government Civil Servant’s Pension Process," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 5(1), pages 65-81, January.
    15. Kyoung Gook Park & Dariusz Stańko & Darren McShane, 2019. "Supervision of lost pension accounts and unclaimed benefits," Journal of Financial Regulation and Compliance, Emerald Group Publishing Limited, vol. 27(3), pages 266-279, March.
    16. Chang, Shuchih Ernest & Chen, Yi-Chian & Lu, Ming-Fang, 2019. "Supply chain re-engineering using blockchain technology: A case of smart contract based tracking process," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 1-11.
    17. Clinch, Greg & Shibano, Toshi, 1996. "Differential tax benefits and the pension reversion decision," Journal of Accounting and Economics, Elsevier, vol. 21(1), pages 69-106, February.
    18. Marten Risius & Kai Spohrer, 2017. "A Blockchain Research Framework," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 59(6), pages 385-409, December.
    19. Saadatmand, Fatemeh & Lindgren, Rikard & Schultze, Ulrike, 2019. "Configurations of platform organizations: Implications for complementor engagement," Research Policy, Elsevier, vol. 48(8), pages 1-1.
    20. Shen, Bin & Xu, Xiaoyan & Yuan, Quan, 2020. "Selling secondhand products through an online platform with blockchain," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 142(C).
    21. Pólvora, Alexandre & Nascimento, Susana & Lourenço, Joana S. & Scapolo, Fabiana, 2020. "Blockchain for industrial transformations: A forward-looking approach with multi-stakeholder engagement for policy advice," Technological Forecasting and Social Change, Elsevier, vol. 157(C).
    22. Kimani, Danson & Adams, Kweku & Attah-Boakye, Rexford & Ullah, Subhan & Frecknall-Hughes, Jane & Kim, Ja, 2020. "Blockchain, business and the fourth industrial revolution: Whence, whither, wherefore and how?," Technological Forecasting and Social Change, Elsevier, vol. 161(C).
    23. Sluchynsky, Oleksiy, 2015. "Defining, measuring, and benchmarking administrative expenditures of mandatory social security programs," Social Protection Discussion Papers and Notes 95198, The World Bank.
    24. Dorfman, Mark & Palacios, Robert, 2012. "World Bank support for pensions and social security," Social Protection Discussion Papers and Notes 70925, The World Bank.
    25. Andoni, Merlinda & Robu, Valentin & Flynn, David & Abram, Simone & Geach, Dale & Jenkins, David & McCallum, Peter & Peacock, Andrew, 2019. "Blockchain technology in the energy sector: A systematic review of challenges and opportunities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 100(C), pages 143-174.
    26. Yael V. Hochberg & Joshua D. Rauh, 2013. "Local Overweighting and Underperformance: Evidence from Limited Partner Private Equity Investments," Review of Financial Studies, Society for Financial Studies, vol. 26(2), pages 403-451.
    27. Waldo Tapia & Juan Yermo, 2008. "Fees in Individual Account Pension Systems: A Cross-Country Comparison," OECD Working Papers on Insurance and Private Pensions 27, OECD Publishing.
    28. Davradakis, Emmanouil & Santos, Ricardo, 2019. "Blockchain, FinTechs and their relevance for international financial institutions," EIB Working Papers 2019/01, European Investment Bank (EIB).
    29. Iris Claus & Les Oxley & Yong Cai & Yuan Cheng, 2014. "Pension Reform In China: Challenges And Opportunities," Journal of Economic Surveys, Wiley Blackwell, vol. 28(4), pages 636-651, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Friedman, Nicola & Ormiston, Jarrod, 2022. "Blockchain as a sustainability-oriented innovation?: Opportunities for and resistance to Blockchain technology as a driver of sustainability in global food supply chains," Technological Forecasting and Social Change, Elsevier, vol. 175(C).
    2. Garg, Poonam & Gupta, Bhumika & Chauhan, Ajay Kumar & Sivarajah, Uthayasankar & Gupta, Shivam & Modgil, Sachin, 2021. "Measuring the perceived benefits of implementing blockchain technology in the banking sector," Technological Forecasting and Social Change, Elsevier, vol. 163(C).
    3. Agi, Maher A.N. & Jha, Ashish Kumar, 2022. "Blockchain technology in the supply chain: An integrated theoretical perspective of organizational adoption," International Journal of Production Economics, Elsevier, vol. 247(C).
    4. Paul, Tripti & Mondal, Sandeep & Islam, Nazrul & Rakshit, Sandip, 2021. "The impact of blockchain technology on the tea supply chain and its sustainable performance," Technological Forecasting and Social Change, Elsevier, vol. 173(C).
    5. Kumar, Sourabh & Barua, Mukesh Kumar, 2023. "Exploring the hyperledger blockchain technology disruption and barriers of blockchain adoption in petroleum supply chain," Resources Policy, Elsevier, vol. 81(C).
    6. Patel, Ritesh & Migliavacca, Milena & Oriani, Marco E., 2022. "Blockchain in banking and finance: A bibliometric review," Research in International Business and Finance, Elsevier, vol. 62(C).
    7. Vineet Paliwal & Shalini Chandra & Suneel Sharma, 2020. "Blockchain Technology for Sustainable Supply Chain Management: A Systematic Literature Review and a Classification Framework," Sustainability, MDPI, vol. 12(18), pages 1-39, September.
    8. J.A. Bikker, 2013. "Is there an optimal pension fund size? A scale-economy analysis of administrative and investment costs," Working Papers 13-06, Utrecht School of Economics.
    9. Andreas G. F. Hoepner & Lisa Schopohl, 2020. "State Pension Funds and Corporate Social Responsibility: Do Beneficiaries’ Political Values Influence Funds’ Investment Decisions?," Journal of Business Ethics, Springer, vol. 165(3), pages 489-516, September.
    10. Panagiota Xanthopoulou, 2022. "Blockchain and the digital transformation of the public sector: The Greek experience," Technium Social Sciences Journal, Technium Science, vol. 32(1), pages 558-570, June.
    11. Teck Ming Tan & Saila Saraniemi, 2023. "Trust in blockchain-enabled exchanges: Future directions in blockchain marketing," Journal of the Academy of Marketing Science, Springer, vol. 51(4), pages 914-939, July.
    12. Alexander Dyck & Paulo Manoel & Adair Morse, 2022. "Outraged by Compensation: Implications for Public Pension Performance," Review of Financial Studies, Society for Financial Studies, vol. 35(6), pages 2928-2980.
    13. Zhou, Yu & Gao, Xiang & Luo, Suyuan & Xiong, Yu & Ye, Niangyue, 2022. "Anti-Counterfeiting in a retail Platform: A Game-Theoretic approach," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 165(C).
    14. Aleksandar Andonov & Joshua D Rauh, 2022. "The Return Expectations of Public Pension Funds," Review of Financial Studies, Society for Financial Studies, vol. 35(8), pages 3777-3822.
    15. Xiaole Dou & Zenglu Li & Chun Liu, 2022. "Secondhand product quality disclosure strategy of the retailer under different supply chain structures," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(7), pages 2982-2999, October.
    16. Dorfleitner, Gregor & Muck, Franziska & Scheckenbach, Isabel, 2021. "Blockchain applications for climate protection: A global empirical investigation," Renewable and Sustainable Energy Reviews, Elsevier, vol. 149(C).
    17. Sun, Yi & Jiang, Shiqing & Jia, Wanjiao & Wang, Yu, 2022. "Blockchain as a cutting-edge technology impacting business: A systematic literature review perspective," Telecommunications Policy, Elsevier, vol. 46(10).
    18. Di Gialleonardo, Luca & Mare, Mauro, 2016. "The efficiency of Italian pension funds: costs, membership, assets," MPRA Paper 76064, University Library of Munich, Germany, revised Aug 2016.
    19. Ye, Wang & Wong, Wing-Keung & Arnone, Gioia & Nassani, Abdelmohsen A. & Haffar, Mohamed & Faiz, Muhammad Fauzinudin, 2023. "Crypto currency and green investment impact on global environment: A time series analysis," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 155-169.
    20. J.A. Bikker, 2013. "Is there an optimal pension fund size? A scale-economy analysis of administrative and investment costs," Working Papers 13-06, Utrecht School of Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:tefoso:v:174:y:2022:i:c:s0040162521004911. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.sciencedirect.com/science/journal/00401625 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.