What is blockchain technology and how does it impact business alumni? In simple terms, participants in a blockchain can share digitized information without the participation of an intermediary.
For example, if you want to conduct a financial transaction with another person, the money can be transferred between the two of you without the use of a bank, clearinghouse or broker. The first real application of blockchain technology is bitcoin, a so-called crypto-currency, because the transaction is encrypted.
What Does This Mean For Alumni?
As more and more companies leverage their Alumni talent pool on a project basis, the use of blockchain to authenticate credentials and verify individuals will enable companies to onboard and bring contractors into their projects quicker, easier and cheaper. Once a company submits validated data into the blockchain, its authenticity is validated forever in this system of record. For an employer, the ability to validate your employment wherever you worked, the certifications you hold, your education and even background checks is priceless.
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Benefits of Blockchain Technology
Because the blockchain is distributed and encrypted, it’s unhackable; the information is immutable and fraud-proof. Once information is added to the chain, it is constantly synchronized and authenticated by the blockchain algorithm. Unauthorized changes are detected and corrected instantly. It’s easy to see why the underlying impetus behind blockchain was for financial transactions but increasingly, broad uses for this technology have evolved.
How Blockchain Could Benefit Human Resources
If you’re in the Human Resources world, you’ve probably already asked, “So what?” Here’s what: one of the conceived uses for blockchain currently gaining momentum is in HR. Here are three examples of how blockchain technology could help the HR process.
In the hiring process, you might use a digital job application, and that application might ask for the candidate’s educational background, including degrees earned and GPA. HR departments are pretty much dependent on what the candidate enters unless they want to go through a long, drawn-out verification process. Enter the blockchain. Suppose schools were part of the chain, and all the applicant’s information existed in digital format, accessible to members of that particular blockchain. HR can use its digital key to enter the blockchain and instantly verify the applicant’s information.
1. Public Records
Let’s take it a step further. Suppose all public records were on a blockchain. Now, HR could verify the applicant’s identity and conduct a background check without having to hire a third party. This would also eliminate the possibility of error due to the existence of identical names and birth dates.
2. Credit Checks
Suppose the hiring party is in the mortgage industry and does business with Fannie Mae or Freddie Mac. That means no one can be hired without a credit check, according to Federal regulations. Once again, instead of going through the credit bureau, the applicant’s credit history could be accessed from a blockchain via a simple sign-on for HR, in moments.
3. Employment History
There is probably no greater challenge for HR than verifying the information on applicants’ resumes. Hiring someone whose resume is inflated or even fake is a constant risk. Furthermore, one or more of the applicant’s past employers may be out of business and impossible to verify through normal channels. Blockchain technology comes to the rescue once again. If all employment records were on a blockchain, verification would be simple and instantaneous — say goodbye to having to call for references and hunt for information.
If all the information about everyone in the world was stored in a single database, the consequences of database intrusion or even corruption would be devastating. But, by using multiple blockchains, one for financial transactions, one for employment verification and so on, the security risk is minimized. In fact, because of the decentralized nature of blockchain data and encryption, proponents say the security risk is zero, but that’s a topic for another blog.
The world we live in is far from operating with everything in digital format only but we’re moving in that direction. And when we do, Human Resources can rest easy. The risks faced everyday in the hiring process will be all but eliminated and the ultimate result will be less waste and greater productivity. And that’s good for all alumni, employees and industries.
Do you have a use case for your employees or alumni that could leverage the blockchain, contact us to learn how EnterpriseAlumni is teaming up with customers and vendors to bring the Alumni Digital Wallet to life.
MIT Has Started Issuing Diplomas Using Blockchain Technology
Blockchain technology is proving to offer major advantages beyond its well-known applications in the sphere of cryptocurrency. A new app allows MIT graduates to prove ownership of their degree using the digital ledger.