Blockchain Poised to Disrupt Human Resources and Staffing Industry
Blockchain technology is making it even more critical for human resource professionals and staffing firms to find top-tier talent. With blockchain adoption on the rise, it is clear that many industries are starting to rethink their business models or create entirely new ones altogether. With entire revenue streams at risk, blockchain is being taken very seriously and talent acquisition should be too.
Impact on hiring
There is a lot of room for blockchain development within a wide scope of industries. Thus, skilled professionals with a background or understanding of blockchain models are in high-demand. Right now organizations are hiring these types of individuals so that they can establish a strong foundation and develop their market. These organizations are bringing in legal and technical support on various levels to develop and establish new operations that lay solid foundations for future market developments. Besides an increase in demand for talent in this specialty there will also be a change in how HR functions will be remodeled. Here are some of the key ways that the application of blockchain technology will transform HR:
Resume validation - A candidates skill-set, previous employment and education would be verified by different nodes in the blockchain system upon first review of resume. This will mitigate the time and costs associated with a bad hire whose skills did not reflect what was claimed on their resume.
Background check validation - Nodes will reduce time needed to complete the background verification process as the system will already be connected to the required verification agencies with essentially no risk of false information.
There are a few business models that are already set up with blockchain-based platforms specifically addressing human resources and staffing. There are currently two distinct categories:
Freelance Contracts - Colony.io is best thought of as a platform that is linking freelancers together. This blockchain model allows for individuals to create and join contracts that have very specific and well-defined goals. Each contract acts like a business model and individuals join contracts based on the skills needed to achieve the purpose. Each freelancer could be contributing to numerous contracts simultaneously and most would never interact with their counterparts in a formal business setting. Payment is based on the terms defined within the contract and transparent to the platform users.
Recruitment Sourcing - HireMatch.io has established a network that will allow entities to recommend or partake in the recruitment of talent for open employment contracts. Each contract has an established bounty that is only disbursed to the chain or network that led to the successful hiring of a candidate. This will make the traditional practice of posting openings on multiple job boards (like Monster, Indeed, and CareerBuilder) redundant, slow, and cumbersome for both employers and job seekers. Instead, this decentralized network could reach a much larger and diverse population and decrease the time it takes for positions to be filled.
“Recruitment Sourcing” forms of blockchain-based platforms offers the largest opening for the Staffing Industry to currently capitalize on. Many staffing companies have huge databases of job seeking candidates and because these source pools are so diverse, each company has the potential to fill a large percentage of contracts without the need for long chains of recommendations. This will breed fierce competition between companies, thus creating the need to be hyper-accurate with “best fit” recommendations so that they can increase the likelihood of providing the hired candidate and maximizing their share of the bounty. A subsequent result will be an increase in the demand from job seekers to have their resumes included in the staffing company database with the largest number of completed contracts. Job seekers will be able to audit a company’s complete blockchain record and make decisions on which organization to utilize, if any, based on criteria such as types of positions filled, industry specialization, contracted companies, the average length of time a contract is open, and many others.
Outside of blockchain, how can Comrise help?
As mentioned, a lot of industries are poised to adopt blockchain, and there is an ever-increasing urgency to acquire specialized talent capable of leading companies through the impending transitions.
We expect to see organizations that are facing disruption start to sequester high-value individuals so that as the demand continues to grow, the cost of acquiring similar professionals will skyrocket for the competition. Companies slow to hire are at a greater risk of being left behind, as they won't be able to make the leap from current industry standards to blockchain-based industry standards.
Therefore, staffing firms like Comrise that have a large pipeline of specialized professionals will become invaluable to locating top-tier blockchain talent.
Additionally, Comrise utilizes RightFit software to help pinpoint talent based on intuitive keyword searching. Comrise can help any industry fill highly technical positions based on experience, previous technologies utilized, and even blockchain experience itself. Comrise can help strategize and focus your recruiting to maximize a staffing budget and gain a strong market position in your industry both in the United States and Greater China.
Despite what your views of blockchain are, there are many industries that will be disrupted by blockchain technology. The future of these industries will rely heavily on preparation for this change and more specifically on their commitment to talent acquisition.
Looking for IT talent in the U.S. or Greater China?
Smart Contracts to Shape the Future of the Finance and Insurance Industries
In a previous article Blockchain Basics we scratched the surface of blockchain technology and what the future might hold for the Human Resources and Staffing Industry. For those who read it and are still wondering, “What is going to cut 3rd party organizations out of certain industries?” This article is for you.
The financial and insurance industries are scrambling for one very big blockchain reason.
Before we go further, a little more background should be laid out regarding the difference between centralized and decentralized systems.
Centralized System – Think of these as the current business model for many industries. There is a system in place that many users put trust in, for example, we insure our homes and cars, trusting that insurance companies will reimburse us for damages that these assets sustain. These centralized organizations charge users to interact with them, and in the case of many third-party intermediaries, both businesses and customers are responsible for paying to utilize these services; like an auto repair company and car owner going through an insurance-based repair. Needless to say, the financial and insurance industries are profoundly reliant upon these revenue streams.
Decentralized Model – Blockchain-based platforms remove intermediaries and create peer-to-peer relationships that don’t rely on an entity like in a centralized system. Blockchain platforms turn each user into a data storage unit that acts as a fail-safe against single-point failure as well as an observation point to prevent misuse and fraud. Each user participates within the system and can deal directly with any other node with minimal latency and cost. Confused? Perhaps read this to clarify [Make “this to clarify” link to Blockchain article].
This is where Smart Contracts come in.
It’s important to understand that Smart Contracts are no more than very specific instructions that are encoded into a blockchain platform, thus becoming part of the system. These instructions are designed to calculate conditions and then execute a function (or functions) automatically when preset conditions are met.
Smart Contracts operate very much in an ‘if this, then that’ manner but have a great deal of flexibility to include many types of conditions, including input from multiple users, and can execute multiple actions simultaneously upon conditions being met.
Smart Contracts are stored in chronological order in the blockchain and can be accessed and audited in perpetuity by anyone on the platform. This is where the anti-fraud component comes in. If any attempts are made to fraudulently change a contract or transaction, the other users can detect and flag the issue.
What kinds of financial and insurance services could blockchain and smart contracts reshape?
In the next several years we can expect to see sweeping changes to real estate & property titles, mortgages, mortgage securities, loyalty and reward programs, structured finance, and international credit to list a few. Insurance companies are following suit and look to capitalize on blockchain identification and wallets to better underwrite assets.
Wait… Blockchain IDs and Wallets?
In order for entities, including those in the financial and insurance industries, to move into blockchain platforms, digital user identifications are being created within the systems. These digital identities exist very much like your current one in that it is an amalgamation of your sensitive personal information. It could include your driver's license, birth certificate, social security number, banking information, car titles, home deeds, stock portfolios, lines of credit, insurance policies, etc. Anything that could be used to execute transactions or act as a condition for completing a Smart Contract is a possibility for inclusion in these wallets.
What about ID theft and fraud?
There are many layers to protect the multitude of sensitive identifiers within blockchain-based platforms. Devices and data can be encrypted, account numbers can be made anonymous, and these can all be further secured with multi-factor authentication keys that can be infinitely complex to ward off even the largest supercomputers.
If that wasn’t enough, because the blockchain platforms are open-source and each node stores parts of the network data, unauthorized transactions or fraudulently modified contracts can be recognized and halted. In short, assets and identities can be kept extremely safe and private from others if so desired.
The benefits of decreased fraud
If the risk of being cut out by blockchain-based platforms wasn’t enough for the financial and insurance industries, the decrease of fraud is certainly another reason for them to invest in blockchain technology. In 2016, more than $16 Billion was lost to consumer fraud1 with estimates of more than $80 Billion in insurance fraud that same year.2 Blockchain could drastically reduce these financial impacts in the future depending on industry adoption.
Digital identifications and wallets can be protected and still made available for review by banks and insurance companies. This will allow for huge strides in fraud prevention. For example, if you’d like to get a new line of credit, perhaps even international credit, a bank can access your digital wallet to review your assets without the worry of it being stolen. Very rapidly an accurate line of credit, no more than what you actually qualify for, can be established with smart contracts set in place to hold titles or other collateral in lieu of default or other agreed upon terms.
Perhaps you need a new home insurance policy. Your deed can be easily reviewed in your digital wallet, an accurate policy assigned, and via the use of smart contracts, payments of claims would only release upon conditions such as titles being held, premium payments being up-to-date, and adjuster signatures being added, etc.
Moreover, consumers stand to gain from the reduction of their premiums. With the shrinking financial impacts of fraud and the increase in accurate asset valuation, insurance and financial institutions can charge less for policies and accounts. What is yet to be understood, however, is how the impact of the loss of other revenue streams due to blockchain will contribute to premium costs or interest rates.
Will blockchain replace financial or insurance institutions? Not a chance, but they are preparing for the impending disruption to their revenue streams and many institutions have started working on blockchain projects. The R3 and the Linux-Hyperledger Project are two examples of how multinational organizations have created consortiums to bridge the gap between current industry standards and future blockchain-based standards. These organizations have made massive commitments to acquiring world-class talent and it is going to pay off.
How can your company prepare?
At Comrise, we can help organizations jumpstart staffing strategies to get your company on the right footing. The leap into blockchain will be necessary for many industries and those left behind will be due to a lack of critical staffing foresight.
Blockchain and the Industries it Will Impact
With cryptocurrencies like Bitcoin and Ethereum making daily tech and financial headlines, a buzz about the underlying technology is everywhere.
For those who don’t know much about blockchain or the underlying premise of the platforms they support, here is a basic introductory video provided by the IBM Think Academy.
While avoiding much detail about the complex digital wizardry involved in blockchain, the key is to be aware of how blockchain-based platforms can reduce the wastefulness in transactions and not just the financial kind.
There are many articles illustrating this reduction-of-waste concept that uses the example of the purchase of a car or home.The start-to-finish process of making such a purchase currently takes a few weeks to complete. Blockchain can reduce this to minutes or seconds.
Blockchain reduces the duration of time needed to complete these transactions, the labor involved, and often the associated fees that are currently necessary to undergo large transactions. Third parties, such as lawyers, listing agents, and banking representatives each have their own industry process and an associated fee for assisting you with these large purchases.
What's the bottom line?
Blockchain-based platforms can make acquiring things that are traditionally impossible in a peer-to-peer manner not only readily accessible but also available more quickly with a high degree of “trust.”
It’s been said that blockchain doesn’t build trust in transactions, it eliminates the need for trust altogether. The data within blockchain-based platforms is decentralized, meaning that every entity within the network stores data and is able to view and validate the digital mathematics and process. Thus, “trust” is inherently built into the system by dividing the burden of authenticating each transaction across the network and making the provenance of each party’s holdings very apparent.
Which industries will blockchain shape in the future?
A lot of them. Too many to list.
Any industry that adopts blockchain will likely do so first and foremost to reduce waste and the associated costs of conducting business. This isn’t the first time technology has allowed for this to happen, and history has shown that eliminating processes, and therefore expenses, liberate both time and money for other innovation.
With that said, there are some specific industries that warrant some notations.
Cyber Security – One very important element to remember is that blockchain is still prone to human error. Smart contracts and the systems themselves have the potential, albeit shrinking, for security issues or unintended and malicious outcomes. Cyber Security and blockchain professionals are in high demand and are diligently working to develop better platforms.
Supply Chain Management and Regulatory Compliance – If some blockchain platforms gain industry-wide acceptance, massive sourcing and regulatory processes could go by the wayside. Take the diamond industry for example; the sourcing and authentication of diamonds are meticulous and lengthy. Blockchain could make these transactions mundane and replace the current diamond exportation establishments with a decentralized global community. Imagine the same for other rare minerals, fossil fuels, or perhaps synthetic compounds used in manufacturing.
Forecasting – Data scientists, business analysts, and marketers alike will rejoice at how blockchain will aid efforts to create accurate predictions for critical business decisions. The endless stream of connected transactions will make it easier to understand how and when transactions are happening and who was involved. This will lead to better predictive models, and again, reduce waste involved with testing markets and trends.
Micropayments – Open your favorite search engine and type in “micropayments.” Blockchain can make business models based on micropayments work by maintaining low transaction costs. One example would be digital newspapers. Scrap the pricey membership and pay just a few cents to only read the articles you are interested in. The newspaper could then spend a few cents to pay for reader feedback so as to not publish unwanted content that will not produce revenue. Both transactions would happen without a large fee, maintaining profitability and reducing waste for readers and companies alike. Similarly, pay-per-click advertising, among many other marketing tools, will find abundant new opportunities with digital payouts streamlined.
Legal – There is a lot of debate on how blockchain and smart contracts are going to be legally represented within industry and the larger global community. Currently, the mediation of issues arising from human error within blockchain-based platforms is the most concerning. Until various legal standards arise, the premise of decentralized regulation has many concerned about the long-term legacy that blockchain could have in some industries. Lawmakers and lawyers alike will play a crucial role in shaping future blockchain-based industries.
In short, blockchain technology has created a technological shift of focus for some of the largest known industries in today’s markets. Many are starting to rethink business models or create entirely new ones altogether. With entire revenue streams at risk, blockchain is being taken very seriously.
Unemployment Continues to Decrease In September 2017*
According to U.S. Bureau of Labor Statistics the unemployment rate has dropped to 4.2% in September.
Job Openings: [5.3 Million]
Jobs openings decrease to 5,270,000 in September from 5,420,000 in August displaying a job decline in the U.S.
Hire Rate [3.6%] & Quit Rate [2.2%]
The hire rate (3.6%) has slightly decreased from 3.7% in August and the quit rate has slightly increased to (2.2%) in September.
* All Data is from Bureau of Labor Statistics, U.S. Department of Labor online at www.bls.gov
Unemployment Decreases In July 2017*
According to U.S. Bureau of Labor Statistics the unemployment rate has dropped to 4.3% in July.
Job Openings: [6.1 Million]
Jobs openings continue to increase to 6,170,000 in July from 6,116,000 in June displaying job growth in the U.S.
Hire Rate [3.8%] & Quit Rate [2.2%]
The hire rate (3.8%) has slightly increased from 3.7% in June and the quit rate has slightly increased to (2.2%) in July.
* All Data is from Bureau of Labor Statistics, U.S. Department of Labor online at www.bls.gov