Across all businesses, blockchain technology is opening unprecedented opportunities for business growth and operational efficiency. From banking to aviation, the practical application of blockchain technology has become one of the most discussed topics in the digital tech world today.
In layman terms, blockchain technology is a secure way of recording business transactions among multiple stakeholders. Since each transaction is regarded as a block, a chain of blocks is generated covering all the transactions using cryptography. Practically everything of value can be recorded using blockchain technology – although several sectors including human resources management are yet to open vigorously to the advantages blockchain technology offers.
One factor that perhaps limits the extensive adoption of blockchain technology in areas such as human resources management could be that it is – for all practical purposes – a back-end operation. Unlike the trendy Artificial Intelligence and 3D, they are not visible to the public although its importance cannot be ignored with Deloitte stating that ‘Blockchain is to value that the internet is to information’.
Despite the fact that it is in its relative infancy in terms of practical application, blockchain has been proven to bring excellent results in boosting operational efficiency. For example, in logistics, Maersk tested it to track cargo while Walmart uses it to track how livestock from China moves across the supply chain. In education and finance too, there is extensive application, with the Massachusetts Institute of Technology launching Blockcerts, and defining them as ‘a permanent and tamper-proof infrastructure of trust.’
How can HR make use of blockchain technologies?
Blockchain technology indeed offers tremendous opportunity for the Human Resources industry. I see great application of the technology in applications such as payroll and cross-border payments, especially when an organisation has a high level of workforce mobility with multiple personnel deployed in multiple markets – such as for GP Global.
Among the most practical applications of blockchain technology are in the verification of qualifications of job applicants and new hires. Further, smart contracts can be drawn up immediately as well as electronically stored and verified.
A secure and up-to-date record of employee skills, training and performance can also be developed through blockchain technology, which helps enhance ease of training and development of the staff, a key requirement in today’s HR practice. In fact, with the region focusing on empowering local talent and boosting human capacity, the use of blockchain technology as a skills-driver must be leveraged by organisations.
Furthermore, blockchain technology helps secure a strong personnel database that will help streamline the payroll processes seamlessly. The need for complicated verification and approvals can be done away with using blockchain, and management can have stronger control in terms of expense management and reimbursement. This has tremendous application in global supply chain management and at GP Global, we are fully aware of the opportunity ahead in the digital transformation of our HR processes using blockchain technology.
Blockchain technology is still in nascent stage, yes, and there are concerns regarding data security and the need for tighter regulation.
There are opportunities and challenges – but that has been the case with any emerging technology. It is only a matter of time that the rough edges will be ironed out and blockchain technology will emerge as a key driver of the HR function.
Anurag Kumar, Head of HR – GP Global
