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Posted by Rowan O'Grady, Hays Canada President, on Wednesday, Jun 27, 2018
You’ve heard the word, but do you know what it means for the future of your role? For hiring managers and HR blockchain could change how you identify candidates, check references, and even pay employees.
Blockchain’s implications for the finance industry are well-known, but the potential to use the technology in the world of work is huge and it will soon transform HR and recruitment.
What is blockchain?
Blockchain is a way to record digital transactions that is decentralized, so it’s not all kept in one place that requires multiple steps to update and access. Instead, all transactions are recorded on each node of a distributed network. Not clear? Scroll down for an illustrated example.
This means information can be accessed by anyone with the required permissions, it also means such data can be verified. That means faster, more trustworthy data across the board.
Hays spoke to several HR experts about how they expect blockchain to impact HR and recruitment, in preparation for its latest Hays Journal. Here are six ways you could see it affect your hiring soon:
Blockchain can be used to verify individuals’ identities, qualifications, credentials and experiences during the recruitment process. According to research by CompTIA, 51 per cent of early adopters of blockchain currently use it to verify digital identities.
Blockchain could make the traditional process of referencing redundant. “Once someone has done a degree, they will just put their certificate in blockchain and it never needs to be verified again,” says Jacky Carter, Group Digital Engagement Director at Hays.
Identify potential candidates
Blockchain will also allow those in HR and recruitment to more accurately identify potential candidates – both internally and externally – as well as the particular roles they are best suited for. This is likely to become more important as organizations make more use of the gig economy, and as it becomes more common for individuals to have freelance careers.
“Companies could use extremely specific criteria to find the person they want. They could query for verified credentials, experience, availability and even personality types,” suggests Kyle Kemper, Executive Director of the Blockchain Association of Canada. “Candidates that match would then receive a push notification and choose to accept or reject the offering.”
Underpin work contracts
The technology can be used to underpin work contracts, using so-called ‘smart contracts’. “Why would you have bits of paper and manual delivery of contracts, where it requires a human being to decide if that contract has been fulfilled or not?” asks Raj Mody, Partner in PwC’s HR consulting business. “You could make contracts programmatic so there are certain actions based on whether certain conditions have been fulfilled, so you might pay your employees’ bonuses based on the operation of smart contracts.”
This could prove to be the most revolutionary area, believes Gareth Brown, Senior Manager in Deloitte’s human capital consulting business. “The ability to switch on and off a contract with any individual employer, and to be able to define upfront the terms you’re working with, might be quite appealing to people but also to employers, because they’re not having to bring them into payroll systems and go through protracted procurement processes,” he adds.
The potential for disruption extends to the recording of all employee information. “Before you even get a job offer, you have to go through a series of interviews and some form of qualification and validation process,” says Mody. “You then get on-boarded and there may be additional tasks you need to complete, whether it’s training records or compliance questionnaires, and that information would be collated.”
“That whole process and data requires many different parties to interact, and this all carries on until eventually you exit, when there might be a handover and the whole process has to renew. Blockchain could radically simplify the experience that HR functions have today.”
Blockchain could also be used in payroll. “That’s probably a bit further down the line but there are examples already, built on the premise that the Bitcoin and cryptocurrency market is stable enough to run payroll on it,” says Brown. “In the longer term, if those markets stabilize, I would imagine we would see more blockchain-enabled payroll technology.”
But, any move in this direction would need to be highly secure and tested before organizations are prepared to use it for this purpose, believes Carter. “In Hays’ case, we would have to be 100% satisfied in the stability and security of any system before we implemented it – we’re dealing with people’s livelihoods and identities,” she says. “At the moment it’s a case of closely watching it as the technology evolves, understanding what technology is being delivered, how trust is being built and looking at how that could potentially impact our world.”
Learn more in the latest Hays Journal.