It's not unknown to you that Blockchain technology has the sheer ability to disrupt industries across all spectrum with its game-changing awesomeness, but what exactly is blockchain technology? Is it a currency? Is it a data storage system? If so, how is it even slightly related to an agency recruiter? What are the applications of blockchain technology? We'll help you understand in simpler terms.
Decoding Blockchain Technology For Dummies
Blockchain is an immutable and shared ledger (encrypted & anonymous) that records transactions and tracks various forms of tangible (houses, real estate, cars) or intangible assets (copyrights, intellectual property, patents, brandings) in a business network. In simpler terms, across a blockchain network, you can share anything and everything that is of value. This helps established companies and even SMEs cut costs, reduce risks and save time. Blockchain technology's global market size is expected to increase from 3 billion dollars in 2020 to 39.7 billion dollars by 2025. This shows an annual CAGR (Compound Annual Growth Rate) of 67.3%.
These are some of the critical components associated with blockchain:
- A distributed ledger system
- Immutable records
- Smart contracts
In a blockchain, all participants will have access to the ledger system. With the help of this ledger, transactions are made immutable, i.e. they cannot be reversed. Hence, no user can tamper with the records, making them highly secure for businesses and government bodies. In case there's an error in a transaction, a new transaction needs to be added to fix it. In such cases, both the transactions will be visible to the parties.
Smart contracts are simple programs stored on a blockchain to help in the execution of a corporate bond or any agreement when certain conditions are met. Without any third-party involvement, participants can be sure of the outcome in no time. This helps in workflow automation, much like what an Applicant Tracking System (ATS) does for recruiters.
3 Major Applications Of Blockchain Technology
Applications of blockchain technology consist of the following:
- Delivery of immediate, shared and completely transparent information, something that cannot be reversed and can be accessed by only network users who have authorisation. This comes in handy for transferring medical data, voting mechanisms, personal identity security, advertising and sales data tracking etc.
- Helps in tracking orders, payments and accounts. It can also store and validate arbitrary data like— gaming data and various social media applications.
- Beyond this buildup, the creation of bitcoin is one of its significant accomplishments. Around 106 million people globally are using cryptocurrencies right now.
Did you know the bitcoin price has soared this 2021 and was up around 68% to $49,260 in February?!
Blockchain Technology In Recruitment
The use of blockchain in recruitment and HR is manifold. Its decentralised network makes it secure and fraud-proof. Therefore, any form of fake or wrong information would be instantly detected. Isn't this a complete change from the way HR and headhunters seem to work with data nowadays?
4 Ways In Which Blockchain Will Transform Recruitment
1. Faster Resume Parsing
For recruiters and recruiting processes, CV parsing is one of the most laborious and time-consuming tasks. It includes hours of emails, phone calls, and researches to confirm & verify facts from all candidate credentials and qualifications. Though an ATS will help you source candidates faster, usage of blockchain technology will accelerate the entire process and save time. All that recruiters will have to do is pull up a specific public blockchain that has that candidate's expert certifications, credentials, and associated qualifications in place. So, all that lying in CVs is a thing of the past.
2. Safe Data Storage
Though the largest data breach was uncovered in late 2016-2017 when Yahoo reported that hackers had stolen information from at least 3 billion user accounts worldwide, it has been seen time and again how companies with more than 1000 employees are prime targets of cyber-attacks. This resulted in a loss of about 500 thousand dollars in 2020.
It is vital to emphasise the significance of secure information storage with blockchain technology, given that HR maintains sensitive, private and monetary data about a company. Since blockchain is decentralised and information cannot be altered from a personal computer, all data stored is secure.
3. Win-Win Strategies
A lot of American and European organisations have created collaborative recruitment marketing processes with cryptocurrencies such as— bitcoins wherein recruiters can get tokens for actions like posting jobs, referring pals or listing potential applicants. This is a win-win strategy. Recruiters are encouraged to have synergy and interaction with diverse teams since they will obtain compensation. This enables companies to have the possibility to work with top-notch recruiters and access a wide variety of talent.
4. Better Matchmakers
As we dive more into this topic, you'll understand that blockchain maintains information about your employees. More importantly, it tracks every interaction or modification in the employee's work history. Recruitment agencies can leverage this to their advantage. With such data, they can better understand employment history, employees' talents and professional aspirations. This will help recruiters match candidates accurately with new possibilities to develop their career exponentially.
Read More: All About Blockchain Technology: IBM
The Future Of Recruiting: Does That Mean Recruiters Will Be Jobless?
Blockchain for recruitment calls for the main paradigm shift in thinking. For starters, it indicates that your data is more secure existing throughout a network of permissible users than being housed in a single location. Not only that, recruiters are now confronted with technology that can seize and verify candidate or employee identification data in real-time and keep it safe.
Here below Recruit CRM will address two major queries:
1. Are Recruiters Going To Be Jobless?
Blockchain in recruitment will document both successes and failures. If you take the above into consideration, you will notice how most of the processes are automated via the use of an Applicant Tracking System and blockchain technology. This leaves everyone with the most considerable doubt in mind– job loss?!
"Instead of putting the taxi driver out of a job, blockchain puts Uber out of a job and lets the taxi driver work with the customer directly."
-Vitalik Burterin, Co-Founder of Ethereum and Bitcoin Magazine
However, if you want us to get real, then here's the answer. If smart contracts (as discussed above) are used, and every transaction and workflow is automated, then yes, this shall have an effect on the middleman, i.e. the recruiter. In simpler terms, if you're hiring and even onboarding for a company's marketing department, you have to give out various passwords, payroll estimates, login credentials and so on. In addition to that, you'll have to communicate across multiple departments to collect the information that you need to update the employee's profile and get it added to your system. If using blockchain technology, a blockchain ledger will let you skip this process entirely by immediately adding employee info that is entirely correct and transparent.
2. How Will Recruiters Spend The Time Blockchain Saved Them?
A recruiter's role might change from here on. With time a recruiter's primary purpose would be more market and business-oriented. They would be responsible for bringing in training programs for candidates and more humane and diversified approaches that technology won't assist. Thus, recruiters could easily focus on making recruitment more strategic and honest.
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