Blockchain: How will it Impact the HR Industry?
In 1995, astronomer and author Clifford Stoll, famously wrote in an article published in Newsweek:
“The truth is no online database will replace your daily newspaper, no CD-ROM can take the place of a competent teacher and no computer network will change the way government works.”
We can only imagine how foolish Stoll felt when, 17 years after his prediction, Newsweek ceased printing in lieu of an all-digital format.
Today, society is not as quick to dismiss new technology. History has proven that (almost) anything is possible. Remember the drones, hands-free video games, and video phones that appeared in the Back to the Future movies? They seemed inconceivable back in the ‘80s, yet they, and a slew of other innovations from the trilogy, are now a part of our everyday lives.
So what’s the buzz about the newest technology, blockchain?
The (sort of) simple definition: Blockchain is a decentralized, encrypted public ledger for organizing groups of data, or “blocks.” As more data is stored, a “chain” of blocks is formed. What makes it so different is that, instead of the data being kept on one server and owned by one company, the data is stored across a peer-to-peer network. It’s the backbone technology for the digital currency (or “cryptocurrency”) bitcoin.
Blockchain has the potential to disrupt the entire internet and just about everything we do online. Today, with every comment, click, and website we visit, that company captures our data and has control over it. In contrast, blockchain technology relies on shared information. This means that all transactions are public, giving you ownership of your data and decreasing the risk of security breaches.
Blockchain technology is poised to impact many industries.
- Attorneys can now draft “smart contracts” which enable automated actions without human involvement.
- For the banking and finance industries, cryptocurrencies can cut costs and increase efficiency.
- It can streamline audits and enable accounting professionals to monitor financial performance in real-time.
- For the insurance industry, blockchain can simplify the claims process and help prevent and detect fraud.
- It could eliminate much of the paperwork associated with real estate transactions. Liens and land titles can be stored safely and permanently with less work and expense.
And the list goes on…
What About the Human Resources Industry?
Since HR professionals access data daily to perform routines tasks, blockchain can have a significant impact on the industry, specifically:
Simplifying Verification Tasks
Blockchain has the potential to speed up the hiring process since recruiters can verify a candidate’s credentials in a highly secure way without having to contact third parties. Plus, the chances of credentials being falsified or tampered with are reduced.
London-based APPII touts itself as “the world’s first blockchain career verification platform.” Using an app, job-seekers can create a profile of pre-verified achievements, qualifications, and experience to share with prospective employers, thus simplifying the process for them and the hiring manager.
Easing International Employment
Handling payroll overseas is expensive and time-consuming due to the constant changes in exchange rates and the need for multiple banks. The blockchain-based payroll system Bitwage is changing that by making it possible to pay international employees with bitcoin. The flexibility and low fees associated with using cryptocurrency reduces the complications and costs.
Need to hire a temporary employee with a very specific skillset? Bitcoin could open up a world of possibilities (literally) by making the process of compensating international freelancers and independent contractors simpler. Screening temporary workers, and vendors alike, is easier too since all skills, credentials, and experience can be verified with blockchain technology.
How will blockchain technology evolve? Will it revolutionize business as we know it? Will bitcoin become a global currency?
Rather than speculate, we’ll learn from Clifford Stoll’s blunder and take a wait and see approach.