CP-68:Blockchain & Digital

signatures = Legally Enforceable Costpoint

Transactions

Dmitri Tyles, Deltek

The specifications, functionality and schedules described in this

Roadmap reflect Deltek’s current estimates, may change without

notice and do not constitute obligations of Deltek.

The information shared today regarding future product features

is considered confidential. Furthermore, it does not represent

a commitment on the part of Deltek to deliver the new

functionality that is discussed, nor does it obligate Deltek to

deliver any new functionality within any specific timeframe.

Disclaimer

Agenda1. External vs Internal automation

2. How blockchain helps

3. Costpoint Use Cases

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Internal vs External automationAll ERP vendors are focused on automating business processes WITHIN an enterprise

… but there was always a need to automate processes across enterprises

… and with an increasingly integrated economy this need and value of external automation is constantly growing

However, the ERP industry is yet to provide out-of-the-box solutions for “external automation” space …

The key technology challenge precluding the industry to automate business processes between companies is inability to create

LEGALLY ENFORCEABLE TRUST

Internal vs External automation

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Blockchain is a technology which allows

to create trust between two parties who

want to work together but do not trust

each other

How blockchain helps?

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Blockchain is a distributed ledger (database) of digitally signed

transactions

• Distributed

- each participant has its own copy (as participants do

not trust each other)

- Same as today each party has its own copy of a paper

contract

• Digital signatures are accepted in courts

- ESIGN, UETA regulations in US

- eIDAS in Europe

- Other countries have their own similar laws

Blockchain – key concepts

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Costpoint Use-Cases

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• Prime will get blockchain ledger as part of Costpoint deployment – on-

prem or Cloud

• Suppliers who also have Costpoint can form blockchain with Prime out of

the box.

• Suppliers who don’t use Costpoint can have their blockchain node/ledger

hosted in Deltek Cloud

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Basic deployment options

Prime

Blockchain ledgerNode 1

Supplier A

Blockchain ledgerNode 2

Supplier B

Deltek Cloud

Blockchain ledgerNode 3

• Two key use-cases:

– Make PO transactions between Prime and

Vendor/Supplier in Sub-Contractor Mgmt and Supplier

portal legally binding

– Make invoice approvals by Prime and Supplier legally

binding

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Step 1: Legal enforcement of existing transactions

- Prime’s instance of Costpoint may enforce legally binding agreements- “Smart contracts” in blockchain terminology

- E.g. a transaction may dictate that Prime can’t bill for any product which contains a part from a supplier which wasn’t paid for after 90 days. Prime’s own instance of Costpoint can enforce the contract on Supplier’s behalf instantly and more effectively.

- Auditors can see a single mutually signed view of Prime/Supplier transactions – single version of the truth

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Use established Trust to provide new capabilities

- If a Supplier is also using Costpoint:

- Supplier’s instance of Costpoint can also automate

compliance with the terms of legal agreements

- We could provide out of the box solution to start tracking

shipment of goods and payments through the same

blockchain ledger for both Prime and Suppliers

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Use established Trust to provide new capabilities

Digital signatures using FIDO devicesLightweight alternative to blockchain

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What is FIDO?

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• Fast Identity Online (FIDO) - new security standard quickly gaining industry

adoption

– FIDO alliance has 200+ members with diverse group of large industry

leader on its board

• Microsoft, Google, RSA, Intel, Lenovo, MasterCard, VISA, American

Express, etc

– More than 200 products from global technology leaders are now FIDO

Certified

– New standard brings major improvements in security, usability, privacy –

at the same time

• stealing database with user credentials from the server is no longer

possible as user credentials are no longer stored on the server

• Biometric authentication becomes the “norm” which significantly

improves both security and usability.

What is Web Authentication standard?

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– W3C released new Web Authentication (WebAuthn) standard in April 2018

• Defines an easy way to include device/biometric authentication in any Web browser

based application

• WebAuthn does not require traditional password

• Chrome, Firefox and Edge already support new standard, Safari is in-progress

– The number of supported authentication devices, methods and scenarios rapidly grows

• Edge, Chrome support fingerprint, Bluetooth and face recognition on Windows 10

laptops

• Chrome supports fingerprint and Bluetooth authentication on Android phones

• Separate fingerprint USB devices are already available

FIDO devices as a way to sign business transactions

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– FIDO devices can be used to digitally sign authentication

requests as well as business transactions

– Digitally signed transactions can’t be altered without

detection

… but can be deleted if they are only stored by one

company

– Need to evaluate the risk/likelihood that e.g. Prime

responsible for storing transactions would intentionally

delete them

Conclusion

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• Lack of legally enforceable trust is the barrier to

automating inter-company business flows

• Digital signature and blockchain are key technologies

which help establish legally enforceable trust through

software

• There are multiple use-cases in Costpoint where

customers could benefit from increased level of trust and

cross-company automation