Editor’s Note: In our four-part series, Breaking Down Blockchain, ReWork explains the potential of this promising new technology in the world of HR. Check out our previous pieces, on how blockchain is transforming resumes and onboarding.
An embroidered patch stuck to a tiny vest is emblematic for the Girl and Boy Scouts. When a Scout picks up a new skill, a merit badge is both praise and proof. The child’s accomplishment has been verified by an authority figure, and anyone who sees the badge knows the new skill it represents.
At its core, blockchain is this system turned virtual. When adapted for use in learning and development, employees earn digital badges—nodes of data—that are stored in a transparent, verifiable and unchangeable network over the course of their careers. Be it a skill gained through a past role, a credential earned via an online training course or a formal degree, employers can easily access these bits of information when an employee shares their individual blockchain.
There’s more to blockchain than just convenient recordkeeping, though. Not only can it help with credentialing and maintaining a ledger of past learning events, but it can also link learning to compensation to ensure employees are paid on par with their skill sets and make them more mobile within their organization and beyond.
Digitizing Employee Credentialing via Blockchain
To date, the biggest benefit of using blockchain to keep track of on- and off-the-job education has been that these records are verifiable and unchangeable. (Read about the advantage of blockchain and credentialing during onboarding in an earlier post in this series.) But now, in the context of the COVID-19 pandemic, Tom Vander Ark, CEO of Getting Smart, a resource library for learning professionals, says the flexibility and dynamic nature of blockchain makes it an invaluable tool for credentialing existing employees—not just new hires.
Employees are taking in content from many different sources—attending virtual conferences, taking remote classes, participating in webinars and more. With blockchain, Vander Ark says that employers might even be able to bypass aptitude tests and certain industry-specific requirements (i.e. coding tests for engineers or writing tests for journalists) by trusting a reliable blockchain record.
Using blockchain as a record-keeping system, employees can accumulate verified skills from both internal and external training and development opportunities—and the record can even include informal, small learnings called microcredentials. As Vander Ark explains, most microcredentials require a demonstration of mastery in a prescribed fashion, and there are often several paths to developing and demonstrating a skill. When an employee claims to have developed a skill, an authority must assess and verify it before issuing a microcredential. “The benefit is certainty around the demonstration of the skill,” Vander Ark says.
Blockchain Can Also Seamlessly Link L&D Achievements to Compensation
While credentialing is the most obvious use-case for blockchain in learning and development, blockchain can inform compensation, too, Vander Ark says. Earning a particular badge, microcredential or certification could trigger compensation changes like a bonus or even a new pay level. If an employee qualifies for a new compensation package after having completed a unit of learning, blockchain can make this change seamless.
“Blockchain can handle automated transactions easily,” he says. Vander Ark gives this example: a school district employee who finishes a masters degree might qualify for higher pay. That employee must first acquire a transcript, then send the transcript to the school district; there is paperwork involved, and the HR team has to notify payroll. Three months and ten hours of paperwork later, the new pay rate is in place.
“With a blockchain record it could happen automatically,” he says. “As soon as that college verified the degree, it would trigger an increase in compensation.”
The same could apply to gig workers and freelancers who qualify for new levels of payment based on years of experience, certifications earned or the conditions of a shift they’re working, he says. And the gig economy is ramping up. “People are increasingly working from home, and more hiring and recruiting is done remotely as well. More gig economy work is happening and contractors are being hired in unprecedented numbers, especially at large Fortune 500s,” Vander Ark says.
Blockchain Supports Internal Talent Mobility
As a network, blockchain has the potential to become a ticket to mobility. By implementing blockchain and a digital badge system, employees might find added motivation to learn, knowing that their accomplishments can easily travel with them if they eventually want to move on to a new role or even a new company. Plus, this portability also fosters a more personal way of learning, because it encourages learners to pursue whatever interests them with the confidence that it’ll be documented and counted towards their career.
“It allows employees to have some choice over what they learn, how they learn, when they learn and how they demonstrate their learning,” Vander Ark says. “It really personalizes learning because people have some optionality, voice and choice.”
For employers, blockchain makes confirming skills and credentials more straightforward when considering existing employees for new roles or promotions. When a position opens up, they don’t have to rely on an outdated resume from when the employee was first hired—instead, they can refer to a blockchain, which is consistently updated as workers gain new knowledge. And, ultimately, more potential for mobility translates into retention, because employees who are motivated and engaged are more likely to stay at a company than those who aren’t.
Blockchain in learning, even in its early days, is a win-win.
Did you know that Cornerstone joined the Velocity Network to help accelerate the development of a universal blockchain-powered network for HR? Learn more here and follow this series for everything you need to know about blockchain!