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How HR Professionals Can Benefit from Blockchain Technology

How HR Professionals Can Benefit from Blockchain Technology

How HR Professionals Can Benefit from Blockchain Technology

Blockchain technology serves a variety of purposes, and has even started to make an impression within the area of human resources. Utilizing blockchain offers a wave of opportunity across specific areas of talent management, such as recruitment. For instance, it allows peer-to-peer interactions that decrease middleman costs and streamline the flow of data necessary in the hiring process.

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“Blockchain technology happens to be one of the most secure, and advanced forms of what we call “distributed ledger technologies” or DLTs. It’s a “ledger” because it keeps track of a list of transactions shared with people in a network,” explained Will Lee, CEO of Blue Whale Foundation. “It’s “distributed” because everyone in that network has an identical copy of this ledger, and they can see all the previous versions of it – like a shared Google document. Now every time a change has to be made, a majority of the people on the network have to agree – or reach consensus – about the change. Once everyone agrees, the change is made, and everyone can see the new edited version. The fact that its “distributed” this way grants reliability and security as it stores data that can’t be altered without majority approval from the network.”

So how is it helping HR professionals?

Here at Solutions Review, we had the opportunity to speak with Lee bout how exactly blockchain technology is impacting the HR department and how professionals can benefit from utilizing blockchain. Below is what he had to say.

Blockchain is incredibly powerful for HR professionals especially when it comes to the verification process when you have to evaluate educational qualifications and professional certifications. You want to make sure you’re getting what you paid for, right? Now in 2013 alone, roughly 3,000 false degrees were being sold. Also, 75% of HR managers having reported catching a lie in a resume.

Blockchain holds the potential to quickly and reliably eliminate fraud by giving job seekers the potential to create a digital file of their educational qualifications, and on the other hand, permits employers to verify the accreditation of potential hires within minutes or hours at most. Traditionally, this process takes weeks to confirm.

Blockchain technology is well-suited for improving the hiring and recruitment process as well – it can provide quick and easy proof of education and work history verification. Blockchain technology verifies who worked on specific projects and their role in it. So as mentioned earlier, the decentralized public ledger allows employers to quickly and easily compare and assess potential hires’ based on their verified ratings or reviews. Additionally, because clearly-defined scope of works can be written into smart contracts, compensation is also transparent and automatically paid out upon task completion.

There is also a potential for blockchain to play a role particularly in terms of performance evaluation.

“One of the things we’re trying to do at Blue Whale is to develop a “Contribution Activity Manager.” It allows people to be rewarded for completing any number of predefined tasks on the network such as dispute resolution, leaving reviews, referrals and so on. That allows individuals’ contributions to specific projects, and also the team in general to be tracked, and rewarded easily and fairly. Of course how fair the system is will depend in large part on the definition of the items which deserve recognition – and part of the beauty of blockchain is that anyone can suggest a change; and as long as the majority of the network approves that addition or deletion, then it will be implemented with minimal delay and unhappiness,” added Lee.

Click here to read the full interview.

Looking for more? Download our talent management buyers guide and check out the top-24 products available in the market with full page vendor profiles, key capabilities and questions to ask yourself and the vendor before purchasing a talent management solution. For those just starting the talent management software search process, this is truly the best resource to help get you going.

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