Transcript: Voice of Blockchain 2018 Recap: Part 1

Hello and welcome to the Constructor Podcast, The Best Way to Build It, Episode Number 92. I'm your host, Brittany Campbell-Turner, and this podcast is dedicated to helping property owners have certainty in their decisions about their construction projects. We talk about fostering trusting relationships, help you to understand how to lower risk, be under budget and on schedule, and most importantly, exceed your end user's desires. In the last episode, we spoke with Tony Llewellyn, the collaborative director at Resolex. He's the author of two team coaching books, Performance Coaching for Complex Projects Influencing Behavior and Enabling Change, and the Supporting Toolkit, Team Coaching Toolkit, 55 Tools and Techniques for Building Brilliant Teams.

We review psychological safety and how blockchain being built into the mechanics of governance structures can enable effective team building and resiliency within those teams. If you haven't listened to that episode yet, check it out at constructor.com slash EP 91. At the Voice of Blockchain Conference two Fridays ago, I hosted a panel discussing about how construction is an industry that's ripe for blockchain because we need to build more collaborative, trust-based relationships in this industry. I and my fellow panelists, who included Kimono Numa, Bim Storm creator, Michael Bordenaro with the Asset Leadership Network, and Rob Salvador from DigiBuild, we all spoke about how we're transitioning to an industry where we produce lots of data that can actually help us to build more trusting relationships.

We talk about how this can be done from design through construction, through the asset lifecycle with blockchain technology. I wanted to share this presentation with you in this episode. Listen in. I'm the host of the Constructor Podcast. I also work as a project management consultant at MACE and I do projects here around the city with private institutions, retails, financial institutions, things like that.

But the podcast is focused on how to increase productivity and optimize construction. I've had the pleasure of having one of our panelists on the podcast, but I'll introduce each one of them individually. We have here on your far left, Rob Salvador. He is working as a general contractor, small to medium general contractor around the nation. He also is one of the co-founders and CEO of DigiBuild, a startup for construction.

In the middle, Kimono Numa, he is the creator of something called Bim Storm. How many of you know what Bim is? Okay, a couple of you. That's great. We're going to get into what Bim is in a second.

He's been working with the Coast Guard, Veterans Affairs, community colleges of California to help them collaborate during their Bim process in order to maximize efficiency through that process itself. And lastly, Mike Bordenaro, he works with Asset Network and he is one of the first to be certified ISO International Standards Organization 55,000, which is a new asset standard. So we're going to hop into the discussion. For those of you who don't know what Bim is, I'm going to ask Mike to give us a little bit of an explanation and hopefully you get our references here.

Since we don't have visuals here, just imagine everybody knows what Bim is. Princess Leia loaded a Bim of the Death Star into R2-D2 and said, help me Obi-Wan, you're my only hope. Obi-Wan took R2 to Luke. Luke brought R2 to the Rebel Alliance who were able to quickly download the building information model, analyze it, use the information to pre-program their X-Fighters to deliver a bomb to the intake valve on the Death Star. At the last minute, Luke went with the force.

He hand sketched the ending, but that's how powerful Bim is. It can help destroy evil empires. And right now people, we are the evil empire and we need to use blockchain to destroy the bad part of ourselves. Wonderful explanation. Thank you, Mike.

We're all in the construction field, if you didn't gather that already, and we're going to be talking about use cases. We're in a state of the industry today where we're looking at increasing productivity. There are lots of studies that say how slow productivity is in the construction industry. And that's not the real issue because we're learning things, we're adapting technologies, and one in particular, Bim, which we just had eloquently described. But the real question that we're having is what's the perception of data?

How do we collect data? How do we transfer data back and forth? And I think once we understand how much data we have and that we need to maximize how we transfer that and make it more transparent and increase that validation, increase the capability to get consensus over what data is selected, that's when we're going to shift in this industry and blockchain can help. So hopping right in, let me ask Kimon the first question. What do you see as an opportunity for integration with blockchain as it relates to the design?

Because Kimon is an architect, he's actually a life fellow at the American Institute of Architects. I think he's best suited for this question. So if I speak from the architect's perspective, the hat of the architect that designs and constructs facilities, my view of a building like this is Bim and buildings like this are our user interface to the world around us. And the world around us has tons of information and data. And the design and construction process, we crunch through a lot of information, a lot of data in absolutely the wrong format because it's hard to get to and share.

It's very much kind of centralized and project focused. We need to design and construct this facility and a lot of it ends up in paper documents or PDFs that we shuffle around. So as an opportunity relating to blockchain, I see that every piece of data in a building is living data that tells us how much electricity are we using, how many seats do we have here, how's the temperature of the air around us. All of that is information that needs to be shared in the design and construction process, but also as the building lives on.

And that's a continuous process that needs to be crunched through and shared with many different stakeholders. And I see the blockchain technology as a perfect opportunity to help us make that happen. And it's going to take a collective group, a large group of people that are thinking in the same way. So how do we share information and be able to prosper and do what we do as a design and construction industry. Thank you for that response, Kaman.

And what you do with Bim Storm is already moving in that direction, right? Could you share with us a little bit about how that's already working and how maybe the blockchain can support that? Yeah, so Bim Storm has been around for 10 years and we started it to be able to collaborate remotely with people around the world. It was called the Woodstock of the building industry basically. We said anybody can come in, plug in what they can do with their application and their data and it's a sandbox that we experiment with.

But what has spun off from it is we've had a lot of owners that come in and say, hey, we need to do something like this too. We're struggling with how we manage our facilities and buildings. Tomorrow's session, in fact, it's going on right now, we have a Bim Storm for this blockchain conference where we built this conference facility in a model and we're going to be actually doing this. We're connecting blockchain to that process of we need to buy a booth or we need to buy a seat or we need to buy an apartment on the building across the way.

And we have a Bim built of that as part of this Bim Storm and it's going to be live tomorrow as we go through the conference. Wonderful. So he's already decentralizing the design process and finding ways to pull in blockchain to support that process. Did you guys want to add anything? I think one of the most important things to look at is the real world use case of what we're talking about and what this means, architecture and construction or productivity and construction.

The global infrastructure by some accounts is a $10 trillion market. It's everywhere you look, everywhere you see. And right now up to 70% of projects finish late or over budget, which has massive financial implications. And from the architect side, there's a ton of different things like you said. Every physical component to the building process has a data component to that building process as well.

So think about a high rise, there may be hundreds of thousands or even multi-millions of workflows in the form of data that actually come through there. And by being able to hash that into the blockchain to make that data immutable and be able to verify the sanctity of that data, who did what, who did this, who did when, who did where, it allows us to eliminate a lot of the waste that happens in the industry. And when you talk about productivity, construction is notoriously not productive.

And there's only a few answers for that. But one of them is to remove a lot of the wasted workflows, the rent seekers, the third parties. So really being able to hash a lot of that information on chain allows you to remove a lot of those, remove a lot of the trust that makes up those wasted workflows and also a lot of the waste and things like that. To your point, drawings change 50 different times from the start of a project to the end of a project, right?

You know, yes, I put that RFI. No, you didn't. Yes, you had that design in there from day one. No, you didn't. So what happens is you get a really a lot of conflict, a lot of dispute.

Whereas if you're hashing that information on chain, you can make it from day one that you said, okay, yes, this soffit or this wall or whatever was on the plans from day one. It was verified on chain. The transaction was verified. We know that data is real. So it allows you to remove a lot of the disputes that happen in the industry and really help to impact and improve a very, very big industry that's struggling a lot.

Yeah, I would absolutely agree with that. It helps just to streamline that entire process if you fix it just up front. So the building information models are like the chassis of the car. We can make them look really pretty, but it wasn't until blockchain came along that's going to be the engine that drives this vehicle forward to affect the change that Kimon has been wanting to have for more than a decade. So this is a really good marriage.

Awesome. So we're going to transition a little bit to case studies specific to construction. I'm kind of going through the process of construction itself, design, construction, and then asset management. I'll direct the question to you first, Rob, since you're from the contracting side, what are the opportunities for payment processing improvement as it relates to construction? Absolutely.

Construction is notoriously slow to pay, as many of you may or may not know. By the time you, let's say you hang a piece of drywall over there, just in a small example, you're waiting 60, 90, 120 days, sometimes even more depending on the size of the project. And slow cash flow like that, it's a lock on business function that makes building more expensive. And a lot of the reason for that is the inefficiency of the processes and these wasteful processes we talk about. So if you think about what trust means in construction in general, right?

So the ultimate enforcement mechanism in construction is the court system, right? So let's say that a project goes bad. At the end of the day, the ultimate decision maker would be the court system. So everything you do that whole time on a massive multimillion dollar project is documented. And these documents, because there are 40 to 100 closed off stakeholders from one another, general contractors, subcontractor, suppliers, all of these different closed off parties basically take the documents and save the same documents in their central database.

So it wastes time and even more importantly, it wastes money. So by the time you put a payment application in, by the time it goes through the architect's office, through the general contractor's office, through the owner and the bank's office, everything like that. The next thing you know, it's been 90 to 120 days. So by having a single source of truth in the blockchain that all these different closed off stakeholders can look at and know that that truth is computationally provable and cryptographically protected, you know that you don't need for me to save that waiver or that payment application and me and you and you.

It introduces one source of truth that removes all those ancillary workflows that make up the very slow payments. So by integrating blockchain in that one single source of truth, you can really improve payment times in the industry. You know, also goes right along with that is, you know, the disputes that happen with payments. So project manager approves a payment in February and July rolls around and all of a sudden there's a problem on the job site. Oh no, I never approved that payment.

I don't know what you're talking about or I didn't approve that change order. What are you talking about? By hashing that information into the blockchain, you can prove that these parties did agree at this time in this way on this payment or change order. So again, it really removes a lot of the waste, but also makes it so it's safer and less likely to get into disputes because you have that single source of truth. That is, it's the same computer code that you put your life in the hands of an airplane when you fly in an airplane.

It's that same computer code that makes it that the blockchain is verifiable and provable so you can remove all this extra paperwork and data and things that you don't need that clog up the current construction industry. And then there's an opportunity to add to your point to incorporate Internet of Things in order to understand how the progress of the construction project is actually completing so that that payment processing can take place more quickly. So how many days would you say feasible, maybe not necessarily attainable at this point, but feasible for us to do payments?

I mean, you mentioned 120 days is very possible and does happen a day regularly. Oh, absolutely. I mean, you're waiting at least 60 to 120 days. If you're getting paid sooner than that, then you're working on a good project. What's feasible?

As far as smart contracts and actual blockchain transactions, they're instantaneous. Now obviously being that we aren't conducting business in cryptocurrencies and the market's not ready for that, they could be instantaneous. But really, however long it takes you to transfer that data or transfer that digital asset, however long it takes you to transfer that to fiat, to US dollars, that's how possible it is. So for DigiBuild, for example, one of the things we're trying to do is introduce five to seven day cash flow cycles. And that's what blockchain and smart contracts on chain allow us to do.

Whether it's one day or 15 days, anything is better than the current 60, 90, 120. That's the industry standard. Did you guys have anything you'd like to add about payment? Well, I think Rob made a really good point on the two disruptions here. What he's doing is going to disrupt the payment process, but it's also going to do something that I would like to speak on behalf of James Salmon, a lawyer who's one of our colleagues.

When you eliminate the problems, then the legal services are about making sure things go right as opposed to spending money protecting things after things go wrong. So it's really what Rob's working on is a double disruption. One more point to that. I mean, exactly what you're saying, what ends up happening is you get into a dispute and then six months later, can't work it out. Both sides are like, oh, I've already pretty much spent the amount on legal fees that we're in a dispute over anyway, and they end up just settling in court.

That's because of all the ridiculous in-between workflows, paperwork, everything like that. So exactly by removing those risks, you're saving a ton of money that could be a sunk cost if you ever went to court and they end up settling anyway. So essentially we're removing the risk because with the immutable record, it's more auditable. We know that blockchain provides that and that's essentially how this blockchain supports this payment processing. It's much more complex in construction than typical transactions because there's so many parties involved.

To Rob's point, it can get too instantaneous. If we are able to process that data on a verifiable network where everybody who needs to gain consensus can approve. Okay, so let's transition to asset management or property management. Mike, directing this one to you. Could you tell us how ISO 55,000 asset management standard provides more optimized management, potentially using blockchain?

Okay, so the first keynote speaker said that it's not just about blockchain. It's about converging multiple technologies. And what Kimon has been doing with the visualization of the building and everything in it, it's not just building information modeling, it's asset information modeling. It goes beyond that. You can pull the boats up and tomorrow when we have a projector on the screen, you'll see that.

And so it's a combination of the building information and the asset information, but you need the blockchain to make sure that the people who are going to be setting up the chairs, they're going to set them up at the right time and have them in place. And then you can say it's been accomplished and then the payment can happen. Did you guys have anything you wanted to add about this long-term life cycle of management of property itself or the components within property? It's incredibly important for owners.

We work with a lot of large owners that they really are, they're interested in the project, but they're also interested in the life cycle of managing that facility, whether it's a hospital or an airport. And going back to the airplane analogy, a lot of what's happening right now, they are mid-air collisions. There's a lot of problems in the industry, which means there are a lot of opportunities for us to help fix that. And if we think of assets and the life cycle of the building, once you have the building in place, it's constantly shifting and changing.

And there's just tons of data, again, processed through that, which again goes back to how do we make it simple to get to that Death Star decision. We need to get to that piece of information that is a risk, because there are a lot of risks in the building industry and there are a lot of problems that happen because of cost overruns, things falling apart, all of those things that we are very familiar with. That means there are a lot of opportunities for us in the industry to help fix that.

And it's going to take a lot of different domain expertise to make that happen, all the way from understanding the building and construction industry, understanding how assets work. And the asset leadership network, I mean, the ISO 55,000 standard is also important, because once we have some kind of a standard to latch onto, we're talking about the same thing. The challenge that we're seeing with every single owner that we work with are having very fundamental issues of what do we call things and how do we count things.

There's a lot of complexity in the technologies that can do amazing things, but even the most fundamental things are not solved yet. And that's a very solvable problem from a technology factor that we can do. Mike, do you have something to add? The important thing that Kimon said is that the owners are looking at this. The asset leadership network promotes the use of the ISO 55,000 asset management standard in the federal government.

State and local governments are starting to use it now, too. What this list of things to do to manage any asset better does is give blockchain a structure to follow so that the contracts can be aligned with the mission of the owner's organization. It's real simple stuff, but it's in one single document. You have to involve all stakeholders. Duh.

Of course you do. When you get people to agree to these simple steps, there's 174 of them, so it's a lot. But you get them to agree to it on blockchain, and then they can't backpedal on any of the things that they've agreed to. Just one thing to what you're saying. Let's say you build a building, and 15 years from now that owner wants to sell that building.

And when he goes to sell that building, he says, hey, I had one of the walls built with gold-plated walls in there, so my building isn't worth $5 million, it's worth $10 million, just as an example. In a central server system, that owner has access to his central server where he holds all of his data, so he can manipulate that and say, yeah, I'm going to write in here, yeah, there's a gold-plated wall, even if there's not. So when the next person who wants to buy that place comes along, the first owner says, hey, I want to sell it for $10 million, I have a gold-plated wall in there, I promise it's there.

That second owner who wants to buy is going to have to spend a bunch of money on third parties to verify that information is true, because the first owner has his central database, second owner has his central database, so he has to verify that that information is What blockchain does by having this distributed database that is a shared network that is validated by these validators in the network is when those blueprints were drawn up with a gold-plated wall in there, that could be hashed on chain to where the network agrees, yes, this transaction has been validated.

We know there is a gold-plated wall in there 100% for sure, so down the road when you want to sell the project, this is where we get into the removing rent seekers and removing third parties and wasted workflows. You don't need to hire the third party auditor to go into that building and say, hey, is that gold wall there? You already know that it's been verified by the architect when he built the building on the blockchain that is proven that that gold wall is there. That's just an example of how blockchain can help with asset management, sustainability, as far as future sales of buildings and things like that.

Well, and let's just take that one step further. You talked about the gold plate. Say it's a light fixture and that light fixture needs servicing. You go ahead and you set that up on a smart contract and you have IoT connected to it. Go ahead and take the idea of, okay, the light bulb was out.

It sends an automatic update on your service provider who's still on warranty potentially, if it's within that year's time, to go ahead and come back out to the building, fix the light. The sensor understands that the light is back on and automatic payment can take place based upon a smart contract. Now, that's something that will have had to have been verified by all the parties and stakeholders and whatnot, but that's another aspect to asset management long-term that of, even if it's something small like your one light fixture, but typically that's pulled into a building automation system anyway.

The engineers are able to monitor the building. They're able to monitor the mechanical, the electrical, all the different loads. That's something that they're very familiar with. They can take this another step and automate some of their servicing in order to optimize what they're doing, and they can use blockchain to do that. And be scaled up to the city level.

So it's not just a single building, but if you want to go to the IOT and smart cities and everything, you definitely have to think in terms of how do you scale it from a single building. This will help it. Absolutely. And if you get into the smart city discussion, there's an opportunity to take the information from your building information models and understand what you have from a city's perspective so you can do better urban planning, so that you can make sure that you have the right components in order to service your citizens.

So that's another sort of extension of what we can do by just simply utilizing blockchain in our individual projects and think about how that can connect to more of an open source methodology. Did you guys have anything else you'd like to add? The federal government, the largest owner in the world, maybe China is bigger, but one of the largest owners in the world, has a lot focused on building information models. focus on asset management and ISO 55,000 standard it's being developed and they've got focus on blockchain, but they're not bringing them all together.

And the presentation that we're going to do to close out the event with Joe tomorrow will show how we can do this for something as simple as selling a single ticket to the next event, a single booth to the next event, and then zoom out and show how this works for a building. And then you'll see the rest of the city in the background and it leads to the idea that we can do this for whole communities and cities. I would encourage to think from an agile approach, think simple, but just go really big with idea.

If we start with a simple concept and make it work, and then just scale it and just keep on iterating, that's the way we're going to solve this, because if we try and solve it all at once, we're never going to get there. And the building industry is kind of challenged with that, especially with BIM right now. There's a lot of focus on the complexity of the BIM, the complexity of the building. But what we're trying to solve here, there's some very fundamental simple things that have huge impacts on smart cities, on the building, and then down to the chair level like Mike talked about.

We're going to show tomorrow. So scaling small, thinking big. One of the things I think is really important and why I appreciate being able to collaborate with everyone here is real world use cases for blockchain. You hear blockchain everywhere right now as far as fintech or machine learning or AI or whatever it is. One of the things that is happening right now is there are really not a lot of blockchain transactions or transactions happening have real world use case or have real world value outside of speculating in the cryptocurrency market.

Maybe Bitcoin can be used for payments, obviously, but there's scaling issues there. So I think it's really important for panels like this to come together to talk about the real world use cases of blockchain, how it can make the world a better place, how it can improve business markets and business models. I really subscribe to a quote, one of the VPs over at the Lennox Foundation, and the hosts Hyperledger Fabric, which is one of the enterprise grade blockchains that was created by IBM, which was that the first real use cases of blockchain providing value, you won't even realize that blockchain is involved.

It'll just be a checkbox or something that says this has been verified by blockchain. So while there's a lot of hype and a lot of hoopla out there about all these crazy scaling solutions and this and that, I really think the future, at least short term, is finding places to plug in blockchain in the real world. And I think that's what this panel kind of was all about. So I appreciate the opportunity. And thank you, Brittany, for organizing.

Thank you so much. I've had a fun time running this panel. So we have one minute left. Does anybody have any questions? So as a former architect that left the industry for blockchain because it moves like a dinosaur, as you would probably know, what are the challenges you foresee for industry wide adoption for integrating blockchain technology into the whole AAC design and construction workflow?

I think data, the understanding that we can piecemeal our families in our BIM models, for instance, and say, okay, this is the granular list detail that we can get down to, and people need to understand, okay, this can be put into sort of a database format. Do any of you want to expound upon that? I would say the hardest thing is going to be adoption as far as construction has been notoriously slow to adopt new technology. Now the industry is really reaching a critical mass, as Brittany and you guys probably know.

The industry realizes it has to move towards technology. 1.8 billion has been sunk into construction technology this year alone. So it's getting it. And that's why back to the real world use cases of blockchain under the hood, the construction may not care about blockchain, but they will care if you say, hey, we can save you 10% in wasted costs, you know, and at scale 10% is game changing. Or they will care if they say, hey, your payout cycle is now seven days as opposed to 120 days.

So I think it's just proving the results in an easily digestible way that will help with implementation. It's the status quo that we're challenged with. The status quo wants to keep it slow because there's money being made off of that. And once you get efficiencies in place, then a lot of people are going to lose what they're doing. There are opportunities for those that want to step forward, but there is a lot of resistance because of the traditional ways of doing things that are inefficient are actually money makers in many ways for a lot of them.

So I think that's another thing that we just have to move above that and keep going. It's almost changing the business model. Yeah, the business model and the culture. All right. Well, I think we're all wrapped up.

Thank you, everyone. You can tell I had a really fun time. If you haven't heard the episode I had with Kimon Onuma called Create Agility and Efficiency Open Architecture as a Platform, you can check out the link in the show notes. So the next panel discussion I wanted to share with you is one that actually consists of the organizer of the Voice of Blockchain event and the founder of the Chicago Blockchain Project, Joe Hernandez. He teamed up with another person from the Chicago Blockchain Project, Patrick Kijek, and also with Kimon Onuma, Michael Bordenero, and James Salmon.

If you don't remember James Salmon, he was a guest on the Constructor podcast talking about how to create risk transparency with BIM, IPD, and blockchain. So they did a discussion and it was entitled Building Information Modeling, Blockchain, and Legal Contracts, Selling the Next Year's Exhibitors' Locations. Listen in. First off, let you know my name is Joe. For those of you who don't know, you can find me anywhere as DisruptionJoe.

And thank you very much for being a part of this wonderful event. This has been a success on quite a few levels. I wasn't anticipating and I was honestly anticipating quite a lot. And it's turned out to be an incredible experience here over the past couple days in many, many different ways. People are meeting, they're engaging.

And most importantly, I've seen that there's a lot of business being done as well. So it's been very productive few days. Cryptocurrency is a theme here and it's been bought, sold, being developed. Business partnerships are centering around it. Investments are being arranged as well.

Blockchain accelerates trust for us, which is needed to create all of the business solutions that will make the world the best that it can possibly be. Cryptocurrency is definitely something that entertains me and a lot of us and a lot of traders out there and people who first get into it, you see it. It's the first thing you encounter when you find blockchain because you have something that makes you think, maybe I'll get rich. And then you start to look into it and maybe you get burned once and you're like, I need to learn about this a little bit more and find out what it is.

So this idea of blockchain, it's the vehicle that drives this trust. But like any vehicle, we need the other parts too, the drive chain, the chassis, the suspension and the seats for people to get onto. And we want people to get onto the blockchain vehicle. So we're now going to conduct a demonstration of doing blockchain business because we need every industry to start using blockchain based agreements if we want to get out of this global mess that we are in. So we're going to do a simple business transaction concerning the next voice of blockchain, which will be back here in Chicago sometime in 2019 as planned now.

We'll be using blockchain business process to sell some booths and tickets for next year right now. And we're going to demonstrate to you how you will be able to buy the booths and tickets. We'll show you how we're disrupting the entire conference industry by using blockchain processes, aligning this with visualization processes and asset management processes that combine in a uniquely powerful way. Vendors and attendees will be using these processes we're about to demonstrate here. Now, Kimon Enuma, Mike Bordenaro, the asset management group.

James Salmon is our legal advisor through this project. And Patrick is one of the developers and cybersecurity expert with his own project, Ethereum, but has also done a ton of stuff leading our build after work developing workshops weekly. And I think we're starting with Mike Bordenaro from the Asset Leadership Network. We'll show how our governance system will be based on an international asset management open standard. And then Kimon will help us to visualize the assets in our transactions so you can see what's happening to understand it.

And then James will bring you through the legal implications of what is happening at each step through the process. And then Patrick will validate the technical end of the process so that you all know that it's real. And of course, all of these processes could be used for any transaction, whether it is buildings, as these gentlemen are normally working with, or if it is a conference, as we are working with now. Why are we doing this? Three reasons.

First, we want to show how straightforward it can be to engage in a blockchain business process. Secondly, we want to increase the number of people who can say to somebody else, I have engaged in a blockchain business transaction and it was a good experience. And then third, we want to show off that if we can simply create a blockchain approach to selling conference real estate, like a booth or a seat, we can do the same with actual real estate, buildings, the things that go into these buildings and the energy that goes into the buildings and really anything that can be built.

But first, let's just focus on the process we have established for selling one ticket and one booth at the next voice of blockchain to the asset leadership network. So Mike, we need to start with a governing system of how we get this done. So Mike Bordoneirov, take it from here. Sure. One thing that I learned here that's really important in blockchain is having a governing system and the International Standards Organization has recently created an asset management system that has a list of 170 things to do to improve the management of any asset.

And you don't have to do them all at once, but people who have done them have found 20 to 30% improvement in productivity, profitability, customer satisfaction, whatever they're measuring. And you can do just certain ones of them to get started. So for this, why don't we just start with 4.1, which is aligned with organizational objectives. So Joe is selling booths and tickets on the blockchain aligned with the organizational objectives. Yes.

Check. So we've got that one off. We've got to determine all the relevant stakeholders, which are the owner, Joe, the support staff and potential participants. Are they going to be interested in this? I think so.

You guys be interested if you could take out your Bitcoin wallet, zap your purchase and have it completely legal and immutable on a blockchain. And then we've got to have the leaders ensure commitment to this. Joe, are you committed to this? I think after this weekend, I have no choice but to be committed to this. But yes, I love it.

And 7.5 is determine your information requirements. Kimon is going to be showing that. And then 10.2 is proactively identify potential failures. So we're developing this. We are going to be constantly improving it.

So we're already doing that. These are simple statements, but you get the idea if you check through a bunch of these 170 things that there can be improvement. And that's all the governance system does. So now Kimon, can you show us how to visualize the assets so that people can say, I see what you're talking about related to complex subjects? So you boiled it down to all the shall statements and now we're actually going to go ahead and do this, right?

So the 170 shall statements, we've cherry picked the ones that are most important. OK, so what we did for asset visualization, I'm coming from kind of the building side. I'm a building architect, so I understand how buildings go together and the opportunities we saw are the physical assets connected to the digital twin to be able to do things like let's sell a ticket, a seat to this front row right here for next year, for example, or the next seat over. And we actually structured this in a way that said, OK, if we have the whole city like this, this is actually live.

You can actually if somebody wants to go and look at this live, this is an animation of it, but we actually have it linked live as well. You fly into the Navy Pier here and you peel back Navy Pier to see what's inside here. Obviously, every conference is different, but we actually inserted the conference booths that are sitting behind us into Navy Pier and extended them out for next year. This is a digital twin of the actual booths with links in the booths that say what if we want to buy a seat or a booth?

The green means it's for sale and we can move things around and rearrange it. This is all dynamic data linked to a lot of different things. And as you connect to it, we said, what if we can actually see the booth? There's two seats there. There's a table, there's a carpet, and there's a request for a hundred dollar booth on blockchain.

That's the concept. We actually stitched this together and it's actually connected to the seat. So as the seats get sold, they turn red. Pretty simple concept. And we're all used to doing that in airline reservation systems.

But now with the connection to blockchain connecting into the digital twin of the building, we can do things like there's the booth. It's close to the front entrance. It's in a good position. There are my neighbors around us that are buying the booths. And there's the single seat.

So everything is an asset with a geospatial location, a unique latitude and longitude and a geometry that allows us to link other things to it, the relationships there and the location within the Navy Pier. That's a pretty simple concept, right? Chair, booth. But then if we get into a building like this, a building is incredibly complex, but we have to boil it down to how are we going to develop a building like this? So we said, OK, let's build a tower.

And I picked the site here just at random. This is a nice waterfront site there. What if we build a tower there? So we took the same technology and said, OK, let's look at that red outline there and put a 50-story mixed-use tower there. I don't know if this is a good or bad idea.

We call these the train wrecks. This is a good idea to put something there. This is from an architect's perspective. And we call it the disruptive tower to kind of go with the theme of the show. And I think the penthouse suite is Joe's at the top.

But again, with the color coding, as you look through this, and these blocks of spaces are actually linked live. So as data changes, we see the colors change, for example, and there could be a space up there, a conference facility or an actual apartment, a condominium. And that was the next step to this. So we said, OK, these are the pieces. OK, there's a payment request on the blockchain.

This was $750,000. And the number actually changed from the other day. Things are changing, right? And so that's the sale. And then we said, we need legal agreements.

So you can't finish everything like this. So this is what James is going to talk about next and Patrick about how do we actually then link the legal agreements to this and tether it to that block, that shape of the condo on the 51st floor. So that's the legal agreement. Within the legal agreement, there are links again back to the model, back to other information. So it's really about tethering and linking the disparate systems here that are talking about that specific location, that specific piece of property.

And here is the actual what we call a building information model. This is a model that was built quickly with that green meaning it's for sale. Red means it's sold. Simple concept again. And within the building shows it's 1,109 square feet.

That's going to be put into the legal agreement. We were showing you kind of slides and animations here, but in the background, this is all live. So whoever wants to try and test this out, we're looking for others in the industry that are ready to link your solutions to this because this is in no ways finalized. This is more of a functioning concept of this. There's the tower again and the payment request and the link of the floor plan.

And that's really about assets. When we talk about assets in our world, we're actually talking about physical assets as well, buildings and chairs and booths and nothing is static. Everything is moving. Even in a building that we think is static, things are constantly moving. And a conference like this actually reinforces tomorrow this is no longer going to exist and something new is going to come in.

So how do we manage that complexity? So last night or about midnight, we said, let's actually turn this around. And that's what these handouts are for. We went to some of your booths and had you actually enter through these QR codes a way to document those. The pictures that we showed earlier are from this instruction that we circulated this morning to the booths to capture the assets in your booth and post them back into the model.

And that was the result. We're getting lists of submittals that are coming in as an API and a web service so you can link to this as well too. So that's really kind of the concept. Building information models have a lot of data. If you look at the BIM and blockchain, the data that BIM produces, unfortunately in the design and construction world, a lot of this is very centralized and very file-based, even in the amazing technologies that are out there.

They're still kind of to produce documents. And we think there's so much more opportunity if we think in terms of data and connectivity and the potential of blockchain and decentralizing the data and connecting it to other systems with the ISO standards that Mike talked about to create the consistency. And that combination is what we call BIM storm is combining these different systems together. We've been doing this for over 10 years for different types of systems. And this is a transition to James now about to talk a little bit about the legal agreements and how this is all coming to the dynamics of it.

So what I like to tell people about blockchain is that it has this amazing ability to reduce the trust gap in commerce. That is one of the most important elements of blockchain. We're going to have this peer-to-peer transaction where I can connect to somebody in China and I can enter into a transaction. And if we can validate that transaction on the blockchain, if we can create legal instruments that will enable us to do that in real time, it's going to be a big game changer in commerce generally.

So the legal agreement that we put together in this instance is actually very, very simple. It has some very simple elements. It has the booth number of 14. And I went into Kimon's system and pulled that into the legal agreement. It has the booth location.

There's a link in the agreement for that. What we want to do is we want to take the concept of the legal agreement and we want to be able to automate putting that onto a blockchain. And we started with OpenLaw, which is a tool that's available to create a legal instrument and then sign it and save it on the Ethereum blockchain. And midway through that process, it worked great for the developers at OpenLaw back behind the scenes, behind the curtain. But when they put it out on the public stage, when we tried to use it, we got an error message.

So Kimon and I kicked the idea back and forth and having Patrick involved because Patrick's block you sign instrument that he pointed us to actually solve this problem that we encountered. We were able to create a PDF of the legal agreement with very simple terms. I don't want to overcomplicate the legal aspect of this. It's really just a meeting of the minds. So someone wants to buy a booth, someone wants to sell a booth.

We've agreed on a price. We've agreed on a location. We've agreed on a time when the booth will be available. And that's all that's in that booth agreement. It's a very simple instrument.

We complete the meeting of the minds. Now we want to sign it and record it on the blockchain and preserve it in a way that can be authenticated and validated in the future. And that's what we were able to do with the tools that Patrick introduced us to. So I'm going to let Patrick sort of jump into the next piece of this. He's heard what Kimon had to say about how everything gets modeled.

Mike has to say about how the governance piece of the asset will work. So Patrick, tell us a little bit about how this last piece of the puzzle, this locking it into the blockchain. Great. Thank you. And I wanted to mention Adblock you sign and Nick Tiley.

I call him Nick Block you sign. He just talks about it all day. He loves it as much as the DocuSign people of DocuSign. I think it's like the next big step in legal agreements because you can put your PDF, whatever it may be, right on an immutable ledger and you can sign your own document if it's a legal contract or in my case, it was like the first book that I wrote and it's going to be there forever and there's going to be a record that you can't change.

And some of the times during these legal agreements, like they'll get a lawyer who will change terms afterwards or you'll have a long process that is arduous. In this case, we can just have a booth that's being purchased at any given moment and we'll put it on a ledger that will be validated by the next six nodes on the network and every part of the network will have this distributed ledger that'll have a record of the booth that you bought. So you do get tethered into that price at $100 and then when the volatile market of cryptocurrency changes, you'll still have that $100 price instead of paying a thousand or $2,000 later on.

Let me chime in here with a comment on the way blockchain is going to disrupt the legal profession. What lawyers do is we're in the business of adjusting relationships. We adjust commercial relationships, we adjust private relationships, but part of what happens in any legal dispute is that the dispute comes to a table and everybody has their version of the facts and everybody has a set of cards that have been dealt to them and what happens is they engage in what I call litigation poker. So people don't want to show their cards, they want to hold back, but in a blockchain environment with its radical transparency and the complete immutability of that record, you're not going to be playing litigation poker, you're going to be playing the kind of poker you play with your nine-year-old nephews where everybody has their cards turned up on the table and that's going to be much less expensive for society because lawyers

bills up while they spend a year and a half trying to get all the documents because we're going to know the state of the facts much more quickly and much more readily because they're going to be recorded immutably on a transparent ledger. That's a huge deal for the legal piece of this puzzle that y'all are going to bring to the table. It's going to disrupt things in ways people have never even contemplated in the legal profession. And it's all going to start with the next voice of blockchain.

There we go. We have demonstrated in pretty simple terms what can be done on a large scale to all industries that use assets, but to have a visual idea of how blockchain can work in the conference industry and by extension the building industry or really any industry involving things that you build, it's kind of a nice way to end, I thought, because conferences are held in buildings. Are there any questions on this process here? Yes, Peter. So the question is, Peter's asking, is there a greater efficiency?

What is the cost difference of putting something onto the blockchain like this versus putting on paper? I think that has a lot to do with what James was talking about there. I'll give you a couple of numbers as examples. So if I'm going to litigate a failed construction project, typically I don't think I've ever written a budget for discovery, which usually takes about nine months to a year and a half in almost any piece of litigation. I never wrote a budget for a construction litigation discovery plan for less than $100,000.

And if you were to follow Kimon's system and capture the decisions that are made vis-a-vis the planning design and ultimately the construction of a facility or a built asset and you captured all that data in a real-time database and you kept it in an immutable fashion and it was radically transparent and we could carve out the two weeks that were in dispute and produce zip drives for all the lawyers that were involved that had all the data they needed to go and attend a mediation and get this case resolved, I would think you would at least save the $100,000 times five, six, seven, eight lawyers, however many firms are involved.

So that's a much bigger picture of what we will save. And then I think just on the average transaction, you're also going to save a whole lot of money just doing it efficiently on a blockchain rather than sending FedEx packets with massive documents back and forth and having everybody review them and sign them in paper form. So also in the features and the pipeline for BlockuSign, a great part about it is they're going to create templates that will automate the process of creating different contracts. So when you go from one contract to another, you won't have to reinvent the wheel every time and you can also get a more efficient transaction in the future by not having to start from scratch every time you're trying to validate this process.

I think we have another question over here. The question was, what's the timeline for adoption and what's the impact on the legacy in the real estate industry? She's involved in the real estate industry. So James, can you take that? So I'm the Cincinnati chapter chair of the International Blockchain Real Estate Association.

That entity has delved deeply into this question of how do we record title on a blockchain? And in fact, Cook County was one of the first participants in one of their exercises. And I think we're at a point with this technology and the tools and processes that is not dissimilar to where we were when the Palm pilots were coming out and everybody was trying to figure what's the next thing in the communications arena. And then out came the iPhone and the iPhone didn't bring anything new to the table.

It just put the Garmin GPS inside the iPhone. It put the Palm pilot calendar inside the iPhone. It put a recording device inside the iPhone. All the technology already existed. And I think that's where we are with that.

The technology exists. The resistance is going to be from the existing business enterprises that make money off of the waste and inefficiency and from the governments which can't wrap their heads around, how do we move forward with this? So what I think will happen is we're going to see entities just say, look, I want to make this work. I want to make it work for my employees who are buying new homes in these new markets. And, you know, a P&G or somebody like that is just going to do it.

The first person who Keen noted here, Rumi, on this stage said, it's not just about blockchain. It's about blockchain connecting to other things. And by connecting blockchain to the governance system of ISO 55000, which saves 20 to 30, to answer the question about cost, would you have liked to have saved 20 to 30 percent of the cost of this if we had done this all in this manner? Well, absolutely. And then I also look at larger infrastructure projects.

When you say tunnels and bridges and you have governments like the government of Dubai saying we're going to go fully blockchain enabled by 2020, look at the entire infrastructure costs that are behind the improvements over the next three years, two years. What is 20 to 30 percent on a city municipal budget or even a national infrastructure budget? We're not talking about small amounts of money. And then even beyond that, then you imagine that new value that's created to go out to everybody else is in a transparent, immutable record to move into society and our value to be used in the way that we want our government to be using it.

I'm convinced that this model is good for big conferences, but how about small conferences like 300 attendees or 20 to 30 booths? Is this good or is it viable for them? I think these these technologies scale. The size doesn't really. We get that question a lot in the building industry, too, as far as the technologies for doing these building information models.

You think that only large companies can do it, but it actually is a competitive advantage to be efficient at any scale. And we believe it can scale small or big. It shouldn't matter. OK, as a follow up, we are doing a conference on cybersecurity in the blockchain space. And that is on November 9th at IIT.

If you want to try that, I'm more than happy to. OK, let's do it. First pilot for you guys. Excellent. First client.

Thank you. And there is a question back here. Can you come forward? Hi, my name is Tim. Am I mistaken or are the contracts that you hand people, take it or leave it type of contracts?

And if so, and I'm being cute, but how many contracts have you signed? It's like, here's the contract. That's what it is because it's going on blockchain. Great question. And I know, James, you're going to like the answer that James gives you.

The idea behind decentralization in general is that we're going to enable people to engage in active adjustment of legal relationships live. That's really what we're doing. We're not advocating the creation of block templates that never get changed. We're advocating the live interaction between the buyer and the seller. So, for example, in the meeting space or in the conference space, the booth right next to the door is worth a lot more than the booth in the back corner.

And a conference producer might put the same price on all the booths or they might put an arbitrary number on the devaluation from the front booth to the back booth. But what ought to really set the price for the booth is the demand for booths at the same moment in time that the booths are available for sale. And that's what these kinds of live real time tools and processes are going to enable. You're going to have the opportunity to actively negotiate the price of the booth, the price of the seat, even maybe even the price of individual tickets.

You know, I know that there are conferences I would love to attend, but I, you know, like today I was only able to get here for the afternoon. I would have never bought a ticket for the entire program because I knew I was only going to be able to be here for this very short moment in time. But maybe that short moment in time is actually worth way more to me than Joe set the price for the average ticket. So all that kind of stuff, that's the beauty of this dynamic new world we're entering into.

And another thing is side chains. So you can have certain things that are immutable. We're going to make a decision by this day. And we've agreed to that. But on the side, we're working out the decision.

So you don't have to put everything on the chain and make it immutable. You have to build the flexibility into it. Right. And you don't have to write to the chain every time either. You can view the chain, see what's already there.

And when someone has made a new transaction, then use your gas in order to populate that next booth. And as an exhibitor, I like the ability to pick my booth so I can save a little money on that and spend a little more on marketing or PR costs. I've stolen this example from Kimon. Kimon has used this for years. When you go onto your airline, when you go to Travelocity or any of these things, you get to pick the seat.

And when I try to fly cheap on Frontier because I'm paying for it, they keep trying to upgrade me. They keep trying to pimp me another seat for twenty four dollars more. I'm like, no, I want the one hundred and five dollar seat that I picked, you know, but you can make the decision to upgrade. And I have when my laptop needed a place to open, I've upgraded to the emergency exit seat. I'd like to thank Kimon because he busted his ass to get this together for us.

So thanks. And the other thing I like to thank Joe, he does. And all the way down the line, James Patrick, thank you very much for watching this, everybody. Thank you. We appreciate you.

If you liked this episode, find out more in the show notes at Constructor dot com slash EP 92. If you learned something valuable in this episode, share it with your friends and colleagues. You can also let me know if you enjoyed our discussion by connecting with me on Twitter at Brittany underscore CT or find me on LinkedIn. Or you can tell me via email to at Brittany at Constructor dot com. That's B R I T T A N I E at Construct double R dot com.

This week, we'll be hearing more from the Voice of Blockchain conference and more from past guests, including Lexi Prodromos with the Chicago Blockchain Center, Paul Doherty with the Digit Group and some new voices as well on their panels. You don't want to miss these bonus episodes and presentations from these and more. I look forward to sharing this Voice of Blockchain recap with you throughout the week. If you haven't already subscribed to the podcast, you can do so at your preferred podcast player. I look forward to sharing these episodes with you later this week.