Most people heard of blockchain as Bitcoin rose to prominence. Even though Bitcoin is yet to win meaningful mainstream support, the underlying technology is getting pundits’ plaudits.
The blockchain is a chronologically updated, distributed digital ledger that stores data using cryptography. The ledger can be public or private depending on the nature of business the creator is involved with.
Each block has a cryptographic hash of the previous block, a timestamp, and transaction data. The name “blockchain” means precisely that: a linear chain of blocks. Just like each building block relies on the other for support, each block on the blockchain secures the other.
Blockchain technology has evolved significantly in the past decade. The innovation has unique qualities that make it one of the most dynamic inventions in the past few decades. Mind you, the internet era has had plenty of revolutionary inventions.
But why is the blockchain getting such praise?
These are some of reasons:
1. Greater Transparency
The blockchain is a distributed network, meaning that all participants share the network documentation as opposed to a single copy.
To change a single transaction record, you need network consensus. Data management is all about integrity. In sectors like supply chain management and accounting, such transparency is vital.
Data on the blockchain is immutable. Immutability means that once data is on the blockchain, it cannot be altered or deleted retrospectively. In any enterprise, accurate record-keeping is an essential part of ensuring your activities are above board. Blockchain immutability brings unprecedented accountability and transparency to enterprise and data management. Transparency is critical because it creates a culture of integrity in the running of an organization.
This level of transparency also gives the network its ‘trustless’ nature. Parties don’t need to trust each other to transact on the blockchain. The blockchain being an immutable, transparent ledger, can always be a point of reference.
Storing data on the blockchain is more secure in two different ways.
One is the fact that by virtue of the network being decentralized, data is stored on multiple servers/ computers rather than a single server.
It is difficult for a hacker to compromise the entire network because it does not have a single point of attack. Without a single point of failure, blockchain data is more secure. It is difficult for a nefarious actor or overarching entity to impose their will on a distributed network.
Second, data on each block of transactions has cryptographic encryption as well as a timestamp. To change data on the blockchain, you have to replace each copy of the data on every server in the network.
The immutability of blockchain data makes it inherently more secure than using traditional servers. Therefore, agencies that use blockchain data storage stand less chance of compromise, fraud, or takedowns on the networks than central servers.
3. Greater Efficiency
Ultimately, all inventions boil down to this question; how does it better existing systems? Besides security and transparency, blockchain technology is also remarkably efficient.
An enterprise that streamlines its operations using blockchain technology eliminates human error and excessive supervision. Moreover, you do away with the unnecessary paper trail that is an unfortunate part of traditional record-keeping processes.
Since the blockchain is a single capable record, you don’t have to reconcile multiple ledgers, reducing clutter. The streamlined record-keeping also means that everyone can keep tabs with information on their ongoing concern without waiting for other departments to provide the same.
In supply chain management, efficiency comes in the form of better traceability. The blockchain produces an accurate trail of data or goods. It is easier to narrow down any problem along the supply chain and ensure maximum protection of the end-user.
In the hiring process, companies and organizations need verification systems for the data that prospective employees provide. The blockchain provides a human resource ledger that can objectively verify performance and work history.
Such data can be valuable, especially for young employees without adequate job history to make a general judgment. Blockchain technology streamlines HR and captures employee data efficiently.
Greater efficiency naturally translates into a lower cost of doing business. Whether this means reduced paperwork, not spending as much on third parties, or even improving the productivity of your workforce, the blockchain has a lot to offer. Streamlining data is a direct way to ensure that your overhead costs are lower. For any business, having lower operating costs is a goal.
The reduction in costs translates to more profits. With the extra profits, you can grow your company or invest in other ventures. Besides, you can know which areas of your enterprise need better staffing to improve overall productivity and balance of work.
4. Disruptive Force
Notably, the blockchain is a young industry. As impressive as the innovation already is, its greatest days may lie ahead. The blockchain is and will continue to disrupt the workplace fundamentally.
Having an efficient data management mechanism makes human resource management better, and organizations can get the best out of their employees. Blockchain technology will be massive in creating a smooth corporate culture this decade.
The importance of data analysis in any management decision in a modern workplace cannot be overstated. Therefore, the blockchain can be an indispensable tool in employment and management.
To Cap It Up
Undoubtedly, blockchain is gradually proving to be a necessary innovation. Now that the technology is over its formative phase, the true utility value of blockchain technology is beginning to show.
It comes as no surprise that leading corporate executives and government agencies are investing greater amounts into researching and integrating blockchain technology into existing systems.
As the industry grows further, its dynamism and evolution will most likely disrupt recruitment and HR more like it did to the finance.