- The supply chain of talent relies on formal education and vocational training to continually enrich the workforce.
- Lacking in today’s human resource processes are the visibility, traceability and verifiability necessary to meet the needs of a global economy.
- Blockchain technologies provide significant value in the hiring process to employees, organizations and public authorities.
As your organization considers which new hires will contribute most to future growth, how can you best identify the knowledge and experience needed to face the challenges of the post-COVID-19 economy?
You might think there is an overabundance of choice. This year alone, 40 million new graduates will be competing worldwide with the current workforce for an increasingly smaller number of jobs and careers. Yet as higher educational systems strive to foster pertinent skills for the market, un- and underemployment among graduates largely exceeds that of the general population. As has been often stated of late, with so many “qualified” graduates on the market, why do organizations have so many problems finding the right candidate for their needs?
Have you read?
To understand how to improve your talent supply chain, we must first address the issues – the relevancy of the competencies acquired through higher education, the complexity of accreditation, and the burden of book-keeping. Given the precarious imbalance between supply and demand, we suggest that technology’s contribution to your future success lies in providing an indelible ledger of the workforce’s skills, capabilities and knowledge.
Addressing the three issues
The perennial debate over the value of higher education is clouded by a number of systemic issues: the complexity of teaching knowledge vs competencies, the specificity of differentiated education, and the inability of the market to shed light on exactly what lies behind diplomas and credentials. With approximately $4.7 trillion being spent on education worldwide, shouldn’t everyone have a clear understanding of what they get for this investment?
A second issue is providing a sound foundation for accreditation. The accreditation of traditional institutions has become a complex process in many markets. Evaluating both teaching and learning has become increasingly difficult to measure. Finally, the increasing focus on consumer protection for students helps underline the fragility of the current accreditation processes.
A third issue has been ensuring the administration of education and training. Intellectual property management has become an explicit issue: how is a student’s work processed, archived and recorded within and between institutions over time? Finally, how are the different records input, accessed and verified by the multiple stakeholders in the educational process: students, enterprises, governments and educational institutions?
From our substantive experience in supply chain research and practice, the aforementioned issues boil down to a telling example of supply and demand. Students essentially are input factors in the value creation of organizations that employ them, and supply chain management may lend a hand in finding a solution to these issues. The talent supply chain operates in a highly imperfect market, and procurement activities – the hiring process – are fundamentally constrained by a glaring lack of transparency, traceability and verifiability.
Employers know little about candidates when they enter the organization and, in many cases, their human resource philosophy is based on a survival-of-the-fittest mindset. Many high-performance organizations operate in this way, by continually weeding out candidates who do not make the cut. What if employers had a better option? What if the talent supply chain itself provided a single source of truth about the education, skills and knowledge, and personality of each candidate?
Blockchain creates immutable employment records
In traditional supply chains, this problem is solved through granular data collection in real-time execution systems and, increasingly, by new technologies such as IoT and blockchain. In talent supply chains, data collection is less of an issue than documentation. As employees and managers, most of us understand what we know, can do and where our talents lie. Yet hardly anybody else does.
Blockchain or distributed ledger technology provides demonstrative value in this regard. It offers the opportunity to create an immutable record for each participant in the talent supply chain. Especially when it is implemented on top of decentralised identity and verifiable credentials, it also provides the ability for an individual to determine how much data they wish to share with a future or current employer, an educational institution, or anyone else.
Educational experiences can be stored on chain in cryptographically secure ways and can be maintained throughout a person’s life. It documents their path through different educational stages and there can be tremendous fidelity in the data based on subjects studied, tests taken or strengths developed. Each link of the talent supply chain can be amended for continuous learning, skills acquired at work or professional experiences over an entire career.
Moreover, data about a person can be analysed and shared anonymously with blockchain, which enables the owner of the data to proactively identify opportunities for growth-based on algorithmic assessments, for example, and employment organizations to search for specific skill sets without the need to divulge the identity of the individual who possesses them unless they consent. Because the data is available anonymously, it can be shared more freely and without fear of privacy violations.
To attain visibility in the talent supply chain, individuals need to assume ownership for the documentation of their skill sets, knowledge and experience. Individuals can keep their data in digital wallets that accompany them to educational institutions and from one employer to the next. Each organization that collects data about the individual needs to have the ability to amend the record and individuals need the ability to determine what to share with whom.
What is the World Economic Forum doing about blockchain?
Blockchain is an early-stage technology that enables the decentralized and secure storage and transfer of information. It has the potential to be a powerful tool for tracking goods, data, documentation and transactions. In this way, it can cut out intermediaries, reduce corruption, increase trust and empower users.
The potential uses of blockchain technology are essentially limitless, as every transaction is recorded and distributed on a ledger that is almost impossible to hack. Though the most well-known use case is cryptocurrencies, blockchain is being positioned to become a global decentralized source of trust that could be used to collect taxes, reduce financial fraud, improve healthcare privacy and even ensure voting security.
Blockchain has the potential to upend entire systems – but it also faces challenges. Read more about the work we have launched on blockchain and distributed ledger technologies – to ensure the technology is deployed responsibly and for the benefit of all. We’re working on accelerating the most impactful blockchain use cases, ranging from making supply chains more inclusive to making governments more transparent, as well as supporting central banks in exploring digital currencies.
The benefits of improving the visibility of the talent supply chain are substantial. The value of current educational degrees can be enhanced with more realistic views of each individual’s achievements. Data can be used contextually for the purposes of an application or assessment. At the same time, your HR processes can be redesigned to scout for talent and provide better opportunities for placement to feed your organization with the talent needed to cultivate future economic prosperity.