Kickoff Master’s Thesis: Using Smart Contracts for Digital Services: A Feasibility Study Based on Service Level Agreements Stephan Zumkeller, 5th March 2018, Scientific advisors: Ulrich Gallersdörfer & Elena Scepankova

Agenda 1 Motivation 2 Research Questions 3 Approach 4 Timeline 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis

Motivation – Blockchain’s potential exceeds CryptoKitties “ Blockchain has the potential to serve as an infrastructure for cross-organizational workflow management. [1] ” vs. “ [Smart Contracts] improve the efficiency, speed and performance of contracts. [10] Aside from cryptocurrencies, the Blockchain offers a technology that could reshape companies’ application landscapes Blockchain as intermediary, as trusted integrator of business processes, as trusted shared database Smart Contracts for the automation and integration of business processes ” [9] 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis

Motivation – Possible improvements for SLA Information asymmetry Providers monitor their own services and calculate service quality Customers depend on providers for timely and correct reports Availability and control of information is unbalanced towards providers Customers require ability to verify performance reports [4] […] the blockchain could function as a transparency device to mitigate inefficiencies in markets with imperfect information. [3] High complexity with multiple customers High effort for providers to manage different SLAs for different services for multiple customers [5] Automating the execution of contractual actions reduces complexity [7] Blockchain as a trusted third party for monitoring and reporting - Smart Contracts offer trusted automation of integrated collaborative processes […] smart contracts can make these transactions cheaper to execute and faster [8] 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis

How can Smart Contracts support the execution of SLA contract actions? Research Questions How can Smart Contracts support the execution of SLA contract actions? How can service level information be made available to Smart Contracts? How to design and implement SLA management and execution on a Blockchain? How can SLAs be improved with Smart Contracts? What is the model of a SLA? What parts are suitable to be programmed into a Smart Contract? How do Smart Contract fit in SLA from a legal perspective? What are the roles and life-cycle of a SLA Smart Contract? How can service performance information be made available to a Smart Contract? How can service performance be measured? Which possibilities exist to feed off-chain information to Smart Contracts? How to design and implement a SLA Smart Contract? 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis

Approach: Design Science Research Service Level Agreements Providers & Customers SL evaluations Monitoring systems Reporting systems Information asymmetry High complexity Environment Design Science Research Foundations Literature review SLA Blockchain Smart Contracts Experience & Expertise Guided interviews with providers / customers Knowledge Base IT Artifact: Blockchain based SLA management Rigor Cycle Evaluation Relevance Cycle Design Cycle [6] 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis

Timeline Feb. Mar. Apr. May Jun. Jul. Aug. Knowledge base Literature Review State of the Art: SLA State of the Art: Smart legal contracts Research Artifact Concept: Service quality monitoring Concept: Blockchain data feed Design & Implementation Evaluation Writing Thesis Today 15.08.2018 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis

Sources [1] Fridgen, G., Radszuwill, S., Urbach, N., and Utz, L. 2018. Cross-Organizational Workflow Management Using Blockchain Technology - Towards Applicability, Auditability, and Automation. In Proceedings of the 51st Hawaii International Conference on System Sciences. [2] La Rosa, M., Loos, P., Pastor, O., Weber, I., Xu, X., Riveret, R., Governatori, G., Ponomarev, A., and Mendling, J., Eds. 2016. Untrusted Business Process Monitoring and Execution Using Blockchain. Business Process Management. Springer International Publishing. [3] Notheisen, B., Cholewa, J. B., and Shanmugam, A. P. 2017. Trading Real-World Assets on Blockchain. Bus Inf Syst Eng 59, 6, 425–440. [4] Berger, T. 2005. Konzeption und Management von Service-Level-Agreements für IT-Dienstleistungen. Dissertation, TU Darmstadt. [5] Paschke, A. and Bichler, M. 2008. Knowledge representation concepts for automated SLA management. Decision Support Systems 46, 1, 187–205. [6] Hevner, A. 2007. A Three Cycle View of Design Science Research. Scandinavian Journal of Information Systems 19, 2. [7] Berberova, D. and Bontchev, B. 2009. Design of Service Level Agreements for Software Services. [8] Di Pascale, E., McMenamy, J., Macaluso, I., and Doyle, L. 2017. Smart Contract SLAs for Dense Small-Cell-as-a-Service. CoRR abs/1703.04502. [9] https://www.cryptokitties.co/ [10] Farrell, S., Machin, H., and Hinchliffe, R. 2016. Lost and found in smart contract translation – considerations in transitioning to automation in legal architecture. King & Wood Mallesons, Australia. 180305 Zumkeller Kick-Off: Smart Contracts for Digital Services: Study based on Service Level Agreements © sebis