Payroll software provider NGA HR is piloting the use of blockchain in human resources (HR), focusing on how it can help the sector with regulatory compliance, inter-company data sharing and overall data security.
To realise the benefits of blockchain in a human resources context, NGA first had to integrate over 200 disparate HR and payroll systems, which it has done through Gospel Technology’s enterprise data security platform.
According to Stuart Curley, chief technology officer at NGA HR, the company’s existing integration platform is complicated and costly to run.
“We have over 200 customers, and there’s more than 200 HR systems,” he said. “The reason for that being if you take a big global customer, for example a big global shipping company, they will have many systems operating in many countries, and they haven’t necessarily got it centralised.”
“To manage all that data between the HR and payroll systems, there is data flowing in a complex network of integration technologies, messaging technologies, file transfer systems, and a number of databases that stage and manage things for different applications,” said Curley.
The integration of these various systems on the Gospel platform, however, is only one aspect of the technology.
Once integrated, the systems form a network underpinned by a private, permissioned blockchain, which then allows enterprises to distribute the data between one another in a controlled, auditable fashion.
“We don’t have people interacting with the blockchain in the way they would with things like Ethereum or Hyper Ledger,” said Reuben Thompson, vice-president of technology at Gospel. “We provide something that looks like the systems they used to use through an administrative user interface.
“NGA are bringing in data in a traditional way from existing systems, so there’s a very good solution called Ledger Bridge, which allows bulk data to be loaded from more or less wherever you have it, whether it’s an existing database or a system with APIs like SAP, and those solutions are available out of the box as it were.”
Data is therefore fed into one network from all of the disparate systems, and can be done so securely due to being on Gospel’s privately permissioned blockchain.
“Every single data change that comes from a HR or payroll system is immediately in the network committed as a block to the blockchain,” said Curley.
Given the sensitivity of the financial information NGA handles, the blockchain element of Gospel’s platform also allows the company to maintain an immutable record of changes to the data.
“The distributed ledger that Gospel provides us makes it absolutely irrefutable that that person made that change at that time, which is essential for us in terms of reducing disputes,” he said. “It’s not that we have a lot, but when we do have a dispute, it costs us an enormous amount of time and effort to prove to the company we haven’t made a mistake or to even find out someone has made a mistake.”
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Thompson added that the blockchain aspect of the platform and the historical record it provides stops anybody from taking unilateral action without consent.
“That brings a level of assurance between companies that has not been available previously,” said Curley. “The fact we can orchestrate the whole process through NGA and can link all these diverse systems together means we can remove a lot of the potential points of complication from it.
“We can vastly simplify the way it works overall while bringing this hugely improved and cryptographically secure method of holding the data for the process.”
He added that the ability to manage the data securely through blockchain also makes regulatory compliance much easier. “We have to comply with SOC 1, SOC 2, GDPR [general data protection regulation] and a host of other compliance regulations, and we have evidence we are complying with those regulations.”
The importance of regulatory compliance was also highlighted by Ian Smith, CEO of Gospel Technology, who added that people are now far more aware of how valuable personal data can be.
“The increasing use of cloud technology and outsourced processing means we’ve got a consumption model that’s moving to distributed and decentralised consumption,” he said. “But we’ve also got an increased understanding – at the consumer level as well as the business level – that just emailing spreadsheets with all of your employees’ information on, while it seemed like a good thing five or six years ago, has turned out to be unethical and illegal.”
Smith added that, due to this being the first use of Gospel’s tech with HR data: “What we’ve seen is the ability for NGA to create an offering that’s highly competitive based on its ethical use and management of that data – increasing the level of privacy and security, not only for their customers but for the employees of their customers as well.”