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Blockchain and the Transformation of HR

By Ike Bennion

No longer a pipe dream but now a reality, the use of blockchain in HR has the potential to improve recruitment, hiring, learning, and many other aspects of people's work experiences. In a typical scenario, an applicant collects the relevant blockchain credentials (e.g., contact information, job history, education history) that have been issued to them over their careers, opens up their blockchain wallet on their smartphone, scans a QR code on a job description, then taps "accept" to submit their credentials in both machine-readable and human-readable formats. Their potential new employer then sees those credentials in its application tracking system. Best of all, this data has already been validated by authoritative sources, so recruiters can immediately make a decision whether to hire that applicant without having to spend more time vetting their qualifications.

This breathtakingly simple use for blockchain has powerful ramifications for HR. Like any business process, recruitment involves gathering clear data as quickly as possible and rapidly making decisions that have long-lasting impacts. Data gathering in most business areas is fairly straightforward (e.g., projected return on capital for the finance department, machine throughput for operations) but becomes more complicated when workforces are involved. Blockchain helps address that complication.

The promise of blockchain is an unlocked data-rich ecosystem in which users can accumulate data about themselves over their lifetimes and thus more easily show their unique value. For employers, blockchain mitigates the problem of unclear or missing data by providing validated data (which, until now, hasn't been readily accessible) to inform their strategic workforce decisions.

For some time, discussions about artificial intelligence have dominated HR conferences. However, AI hasn't managed to deliver on its promise of clearer decision making. AI must feed on a clean, rich, wide data set, and companies (large and small, global and local) have struggled to structure and house data in a way that powers effective predictive, prescriptive, and analytical insights. Blockchain is the high-octane fuel for better performance of artificial intelligence and machine learning systems.

The timing of blockchain's arrival couldn't be better, as the business world is currently working to address several momentous questions:

  • How do we transition the workforce in the face of intense and perpetual disruption?
  • How do we find talent to fuel growth and expansion?
  • How do we rapidly redeploy talent in the face of automation?
  • How do we recognize talent in an unbiased, modern way?
  • How do we provide clarity to individuals about where they are and where they could go?

The answers to these questions are rooted in a clearer and deeper understanding of the current state of blockchain.

Better Data for Better Workforce Outcomes

Blockchain will help alleviate these problems by first improving the quality and availability of the data used to evaluate the value of workers. Currently, companies still rely on unreliable (and not necessarily relevant) information such as college credentials (e.g., GPA, alma maters) and titles. With more relevant job-related data, such as a certification for leadership, a highly innovative project, or a skills rating backed by an accrediting or authoritative body, employers can evaluate candidates on abilities and experience that are valuable for their organizations' specific needs.

The machine-readable and human-readable layers of data contained within blockchain reduce the filtering and processing of the data required by artificial intelligence and machine learning. For example, recruitment relies heavily on natural language processing to transform data so it can reveal insights about candidates. (However, that technology is still being refined.) Established standards for different values of data, such as O*NET (a U.S. Department of Labor database of occupational definitions) and Credential Engine (a nonprofit database of credential information), ensure that the value of a skill or credential is well understood wherever it goes.

A Cumulative Transcript for Long-Term Skills Development

Blockchain will also transform the future of work by creating a development transcript for the employee. Today's modern learners can draw on after-work extension classes, massively open online courses (MOOCs), YouTube videos, and other learning options, and turn to corporate training systems only because they have to. By creating a continuous, uninterrupted record of employee development, blockchain can help people better leverage all of the development resources (especially modern corporate learning systems) at their disposal.

Companies are most familiar with the qualifications and abilities their employees have that relate to their current jobs. But as automation forces the business world to more rapidly deconstruct, evaluate, and reconstruct roles, visibility into employees' wider abilities (e.g., backgrounds, unique certifications, other dimensions of their capabilities) may become important for helping organizations adapt to their future needs. Combined with AI-powered tools such as the Cornerstone Skills Graph, "an engine powered by AI and machine learning that automatically detects skills from different sources (profiles, job titles, training, job offers) and identifies them in different use cases,"blockchain can capture and standardize the individuals' capabilities so they can be quickly accessed when needed. 1

An Elevation of HR's Strategic Role

The third way blockchain will transform the operations of HR is by elevating HR's strategic position within the company. Even in the age of scaled HR, a lot of checking, double checking, inputting, background checking, modifying, and verifying is still taking place. Blockchain cuts the clerical work.

With more meaningfully structured data, different databases can share information in both human-readable and machine-readable layers. The effectiveness of AI systems to help predict retention risk, identify new skills, and plan succession would be much greater that it currently is.

The real-world applications of blockchain are just the first step in the transformation of HR. As powerful technology becomes more generally accessible, HR will be better positioned to manage disruption, to respond to growth opportunities, and to build a competitively skilled workforce for tomorrow's workplace.


1 Cyril Le Mat. 2020. "What Is the Cornerstone Skills Graph?" Cornerstone website, October 5,www.cornerstoneondemand.com/rework/what-cornerstone-skills-graph.

About the author:

Ike Bennion is a product marketing strategist for Cornerstone OnDemand, where he works on market analysis and strategy development for learning products. This article was reprinted with permission and originally appeared on the Cornerstone OnDemand blog, ReWork.