Impact of Blockchain in Human Resource and Recruitment Solutions
Blockchain in Human Resource Management will help recruiters find “diamonds in the rough”
Organizations that recruit based on verifiable credentials can find candidates who are overlooked by other organizations that focus only on traditional education and resumes. This provides a competitive edge over hiring from a limited talent pool.
Possible Implementations of Blockchain
Knowing employees have become one of the major needs of organizations today. Being the crucial bearers of knowledge, technology, and service, employees represent the core component of enterprise management. A Blockchain-based human resource management model can solve the issues concerning the authenticity of HR information and provide authentic decision support information to an organization.
With Blockchain Technology, verifying and assessing the education, skills and performance of potential recruits is simplified, enabling the HR to recruit to them to the most appropriate roles. Incorporating Blockchain technology gives people a comprehensive and trustworthy blockchain-based record for their skills, education, training and workplace performance.
A Blockchain based system manages employee mobility and cross-border payments, including tax liabilities and international expenses, with the potential of organisations to create their own corporate currencies. They also help in boosting productivity in reducing the burden of routine, data-heavy processes like VAT administration and payroll. They enhance fraud prevention and cybersecurity in HR, for both employees and employers.
Advantages in Talent Sourcing
Blockchain holds major potential in HR management, from the ability of employers and candidates to maintain and control the access to a trustworthy and comprehensive blockchain record of their skills, training, education and workplace performance. Employers will be able to transform the skills and experience of the candidates into genuine value in the employment market.
The use of analytics on the data available on Blockchain would enable companies to match individuals to different roles more effectively and accurately.
Inclusion of Blockchain in Human Resource management can make resumes and LinkedIn obsolete. Instead of an applicant writing up a description of where they’ve worked and what they’ve done, blockchain transactions will simply store all of their employment histories.
That will totally transform the way that companies recruit candidates. There will be no need for a lengthy verification process where HR offices call references to confirm employment history. They can simply pull up the public blockchain. It’s even possible that the blockchain can store performance indicators like whether the employee was promoted or the reason why they left the company.
Traditional Human Resource Management System
Human Resource Management on Blockchain
Targeting Productivity gains
The enhanced ability of an organization to match and performance and skill of people to jobs can provide an uplift to the productivity of a country. This is particularly true in the case of the UK, which lags behind many other OECD countries today.
Implementation of Blockchain technology may particularly benefit small and medium-sized enterprises. This is mainly because the burden of selecting and recruiting the right talents are especially heavy for smaller businesses. A technology that would effectively help in increasing the productivity of the recruitment process can boost their productivity immensely.
Further, the high-potential targets of blockchain applications include areas like VAT and payroll, where reducing the administrative burden on these smaller businesses would help them focus more on growing their businesses and serving customers.
Cross Border Payments and mobility
The initial steps of multinational businesses into blockchain include the creation of their own blockchain based corporate coins or currencies. These currencies can be used to transfer value across their businesses on a global level. They also allow transacting with supply chains without friction or cost of third-party reconciliation. With time, central banks are also expected to become involved, by introducing their own means of exchange – based on blockchain to support the convertibility into official currencies.
Fraud prevention, cyber security and data protection
Human Resource management in an organisation involves a wealth of sensitive personal data and high volume financial transactions. This increases the significance of Blockchain and its functions in the field. The implementation of consensus in Blockchain helps in security and negates the chances of fraud.
Cyber risks largely emerge from an underlying lack of transparency in data and systems. The introduction of a Blockchain-based management system addresses the challenges of cyber-attacks. This can be particularly helpful in smaller organisations many of which are underprepared to handle cyber threats.
Availability of Authentic Data
A credential recorded on the blockchain can’t be changed or faked. A phoney credential may look like an issued one but won’t verify against the original blockchain record. Digital credentials would remain secure, even if the company issuing them is hacked. For candidates, their records remain available, even if schools or businesses shut down. Individuals could have complete control over the data of their lives, providing access keys when they apply for new jobs. They could include degrees, certifications, courses taken, grades, employment history, salary and more.