Digital, ERP, SaaS… this vocabulary has gradually established itself in the daily life of the HR professional. At the origin of this functional revolution is found, beyond the objectives of cost reduction and modernization of the function, a real intention to make the human engine of organizations more flexible.
Far from the announcement effects, this wave materializes in an HR solutions market of 2.6 billion euros, the growth of which is estimated at 7.1% over the period 2017-2019.
However, this new technological race – which often resembles a “technological waltz” as tool changes are frequent – does not allow organizations to solve all of their problems.
Automation of processes, data protection, valuation of HR data, employee engagement… To meet these major HR challenges, a concept stemming from the Blockchain has become essential: the Smart Contract.
Towards a new method of contracting
The Smart Contract is an IT protocol facilitating the verification and validity of the contract. Computerized and automated, it allows the programmed application of contractual clauses in a secure manner.
From the Blockchain, whose registers are deemed to be tamper-proof, the system then represents a trusted third party. Several direct economic benefits then come to mind: reduction in litigation, reduction in transaction costs and lower risk of error.
A means of optimization and security, technology represents above all a new contractual route that is not very elastic in terms of trade volumes: Sberbank, a Russian banking juggernaut, recently used the Smart Contract to secure a transaction of 12 billion dollars.
Although significant, these functional improvements do not however reflect the potential ramifications of technology: without being limited to inter-organizational exchanges, this new transactional instrument is taking on its full scope within organizations.
From employee service to the convergence of interests
At a time when human resources are being redefined around the concept of employee service, direct and regular exchanges are necessary to identify collective needs and individual expectations.
In this sense, Smart Contracts make it possible to speed up and streamline interactions: in order to adjust the working conditions of an employee, it suffices to integrate new clauses which will then be instantly and automatically transmitted for electronic signature, then applicable.
In day-to-day management, for example, it is possible to process Time and Payroll individually and in real time, which jointly benefits the employee – by increasing flexibility – and the organization – by saving resources.
Also, in an environment revolving more and more around the notion of project and characterized by a “war for talents”, it becomes decisive to identify and reward the respective achievements of contributors.
The systemic presence of a trusted third party and the automation of transactions introduced by the Smart Contract then allow rapid and controlled attribution of rewards proportional to the employee’s accomplishments, as well as a more agile and freer distribution of work.
At the same time, the system provides traceability of activity and a more precise evaluation of performance for better identification and promotion of talents.
Finally, recruitment is evolving: LaborX, a new employment platform, is being organized as a marketplace allowing total flexibility of hiring conditions to the expectations of contractors. It is therefore no longer just a question of offering services to employees, but of setting up areas of convergence of interests between the organization and its employees.
A better conversion rate to avoid reconversion
Beyond the regulatory limits opposing the democratization of the Smart Contract, the main obstacles to its adoption remain the integration and acceptance of such technology.
Upstream, the mapping of flows and processes necessary for such a project induces the mobilization of substantial resources. Likewise, the development phase – that is, the digital conversion of organizational interactions – requires the coordination of the different stakeholders: functional, technological and strategic units.
Finally, although 65% of European employees perceive digital development as the key to better productivity, resistance to change remains significant: 70% of organizational changes do not achieve their objectives, in particular due to a lack of support in the transformation .
It is therefore up to Human Resources professionals to lead this technological development, at the risk of remaining spectators.
By Idriss Ghaddab and Thibault Guilloux, consultants within mc2i Groupe
MOREAU Yves, Blockchain technology issues. Dalloz collection, 2016.
MENARD Claude, The economics of organizations. Paris: The Discovery, 2004