Despite its increasing popularity, blockchain is frequently viewed as the remit of the financial industries – but the technology will impact and disrupt every industry, not least the world of global workforce mobility. This week, we take a look into the near future and explore 5 of the many ways blockchain will bring change to the functions and processes behind the way we work today.
1. Leading the way for SME innovation and more start-ups
One of the biggest beneficiaries of the blockchain revolution will be SMEs – particularly those challenging the status quo of traditional business and leading disruption. Due to their size, SMEs have to be creative to compete in the marketplace, and their innovation will be needed to ensure they are not left behind – these are the organisations who will play to the strengths of blockchain. As Barry E. James points out in his article on www.realbusiness.co.uk, “Those who can enable and help transacting parties to find each other and structure and enable their transactions (think Uber or AirBnB) will thrive rather than disappear.” With 66% of UK SMEs now using remote employees, blockchain technologies will also be valuable in improving their internal business processes and HR functions.
2. Easing of Cross-border Payments for Overseas Staff
Blockchain can be utilised to transfer value globally without the timelines and international charges associated currently with overseas payments. To keep up with the pace of change, banks will also likely introduce their own blockchain exchange processes that will allow conversion into traditional country-based currencies.
Large companies may even create their own “coins” that could be used as currency for cross-border employee benefits, homogenising employee benefit schemes – disproportionate benefits policies is a frequent bugbear for companies with international employees.
3. Boosting Compliance and Decreasing Digital Risk
Blockchain provides transparency and traceability of any transactions made – as digital risk largely occurs from a lack of transparency in systems and data, blockchain provides added security. The technology also controls access through the ability to set tight permissions and unalterable digital ledgers – as updates take place in real-time, any changes will occur across the entire network for all permitted users. The sensitive data stored by many global mobility and HR professionals will also benefit from blockchains – unlike the third-party requirement of cloud-based data, data stored using blockchain can be broken into chunks and spread across the network, meaning it is decentralised, accessible only by the data owner and totally encrypted.
4. Transformation of Tax
Today’s taxation rules have risen from physical transactions and trade – the age-old process of transferring goods or services from one person to another in exchange for money. Already, the laws themselves and traditional processes around recording tax, making taxable transactions are often bemoaned as antiquated.
Under blockchain, transactions will be recorded on multiple devices in a network in multiple countries at once. Complicated questions will arise about the foundation of the transaction and how to accurately apply existing taxation law to that transaction; loopholes will undoubtedly be found if tax laws are left unchanged. If blockchain is adopted as a common means of employee payment in the future, this will impact supplier contracts and any business that utilises contractors or employees performing services remotely. Taxation laws will need to be adapted to reflect the disruptive, virtual and accelerating digital age of business.
5. Simplifying International Admin
Even the clunkiest and most labour-intensive processes in the global mobility or HR professional’s day-to-day role will be eased by the advent of blockchain. Blockchain ledgers can offer a comprehensive and trustworthy record of every employee’s skills, training, performance and productivity that is accessible and updatable across the network in real-time. Data-rich and repetitive activities like payroll management and contract raising will become automated, decentralised, protected, faster and smarter.
In a month’s time, Mauve will be attending the world’s largest blockchain forum to ensure our products, services and systems stay ahead of the curve. Check back for more insights as we explore how blockchain will transform our industry.