Contributor: Eynat Guez, Women in HR Tech presenter and CEO and Co-Founder of Papaya Global.
Everyone in the tech world is talking about blockchain. In short, blockchain is a technology that uses distributed ledgers to continually store information about actions or transactions. The way the technology is built makes it extremely difficult to modify data once added to the blockchain ledger.
Thanks to advanced security capabilities and the simplification of digital auditing, blockchain is often hailed as the revolutionary technology that will transform the financial world and in the past few years, we have witnessed a steady increase in the implementation of this technology.
Due to the rising need to secure all information — not just financial activity — blockchain is increasingly being seen as a true cross-industry disruptor, with the possibility of transforming almost every industry. As we in the HR tech industry perceive information as our holy grail, using blockchain to secure such sensitive data is becoming a requirement, if not a necessity.
The Evolution of HR Tech
Much like every other industry, the HR world has undergone a significant transformation in recent years. From the integration of new technologies such as artificial intelligence, to the widespread adoption of cloud-based platforms and more, organizations worldwide are digitizing their HR departments.
HR departments hold an array of personal information, such as social security numbers, bank account details, passport copies, marital status and more, all necessary to manage a global identity, and all extremely sensitive. Blockchain decentralizes information and provides a secure and digital way to validate and verify information, making its integration into the world of HR a question of “when” and not “if.”
Blockchain has evolved from the technology of the future to be the technology of the present. As a result, HR tech companies looking to ensure their longevity need to implement blockchain into their solution, or risk being a part of yesterday’s news.
Ensuring GDPR Compliance with Blockchain
One of the most pressing issues companies face today is GDPR compliance. With the new regulation going into effect May 25, 2018, companies need to ensure employee information is stored and managed in a way that ensures GDPR compliance — and blockchain is a great solution.
The use of blockchain technology allows for information to be secured in a way that reduces the chance of breach as well as eliminates the possibility of modification after being entered. In a world where 1 in 4 email and social accounts are hacked, implying grave probabilities for employers who must improve security of personal information under the GDPR. Since the GDPR stipulates that information of private citizens must be stored in a secure way, using blockchain to secure employee information is the ultimate solution.
The use of blockchain also enhances privacy protection capabilities by providing an added layer of security thanks to advanced permissions. According to Ofer Herman, the CTO of Papaya, one of the first Global HRIS companies to use blockchain technology to secure their platform, “By using blockchain technology to secure our payroll everywhere platform, we are able to improve information security for our clients by encrypting data in a way that regulates who within an organization can access information. In doing so, not only are we helping companies comply with the GDPR, but we can reduce the possibility of personal workforce information being compromised.”
Standardizing Infrastructure to Simplify Integrations
Organizations today need dozens of systems to work together simultaneously in order to effectively manage their operations, making it imperative to their success that all solutions interact seamlessly with one another.
The use of blockchain as the underlying infrastructure of any HR platform allows companies to simplify and improve the management of information across multiple systems.
Since blockchain is a standardized infrastructure, integration with different systems needed to run a global payroll management solution can be easily adapted. The use of blockchain as the underlying basis of a payroll platform also improves global payroll management thanks to the ability to streamline payments, ensuring the entire global workforce is paid on time and in the correct currency. Since blockchain ledgers cannot be modified, it is the ideal technology for companies who need to audit their payroll information. Not only does blockchain reduce time spent aggregating payroll information, it ensures no errors are made.
The HR Tech Potential is Great
While the most obvious use of blockchain in the HR world is for GDPR compliance and improvement of global payroll management, blockchain has the potential to simplify and improve almost every aspect of HR. From improving recruitment through verification of applicants claims of certifications, to improving the documentation of healthcare records for employees, blockchain will undoubtedly become a critical aspect of HR tech sooner than you think.
Companies experiencing global growth will discover that having a global payroll management solution with blockchain as its base is just the beginning. As the new technology becomes infused in more aspects of HR, blockchain will become the standard rather than a novelty, and companies that do not select a blockchain based solution from the start will likely find themselves dealing with time-consuming transitions down the road.
For more information about Blockchain, attend Women in HR Tech at HR Technology Conference in September in Las Vegas and hear me speak at the session “AI, Blockchain & VR: Are They Here To Stay?”. To register visit www.hrtechnologyconference.com. See you there!