5 key-take aways that HR organisations can learn from blockchain and crypto

The future of internet is changing and so does the future of work. Web3 is a new iteration of the world wide web that advocates user privacy, freedom and ownership of data. It hosts decentralized apps that run on blockchain technology. Web3 is still in development and a few years away from massive adoption. It could be a massive overhaul of how we engage with the web and each other. So, what can entrepreneurs and HR leaders learn from companies that already operate in web3?

I'll share 5 key-takeaways about what companies can learn from web3. Before we dive into the examples I think it’s important to quickly align on what is blockchain and what is web3.

What is blockchain and how is web3 exciting for organizations?

We define blockchain as a (public or private) network that is built by blocks in which information (transactions) are stored and encrypted on a distributed ledger. It uses cryptography where through a public key, all transactions are visible and secured.

In comparison to traditional finance, the ledger on a blockchain is decentralized and the information stored is immutable.?

The network consists of node operators whose primary job is to confirm the legality of each subsequent batch of network transactions, known as blocks. The advantage of a blockchain database is that it’s spread all over the network which means that not only one party can control the data. It is trackable, immutable and also redundant all over the network, which makes it nearly “impossible” to lose or corrupt data.

Web3 represents a new iteration of the new internet where users have full ownership of their own data and can own parts of the internet. This is different where the internet is currently dominated by major players such as Amazon, Apple, Google and Meta.?

Web3 can give companies major opportunities or challenges as talent will have changing needs in terms of type of work, hiring, accountability, contracts, influence, benefits/rewards and work location.

Now that we have agreed on the terminology. These are the 5 key-take awayst HR organisations can learn from web3.

Decentralization / democratizing decision making

Decentralized organizations refer to decision-making from a centralized entity (individual, organization, or group thereof) to a distributed network. In web3, many projects, are organized through a DAO or decentralized autonomous organisation. In a traditional company, shareholders vote on changes in the business, which falls on the CEO to implement. In a DAO, token holders get to vote on any proposed changes which are implemented into the DAO's (policies) code instantly via a smart contract if the changes are approved.?

Because DAOs are democratized, everyone has access to the DAO's source code.?HR organisations can learn from web3 by giving more decision power back to its employees. Lite versions can be applied when you are thinking to launch new OKRs, employee benefits or employee engagement. By encouraging workers to think/ help decide about the companies future more regularly, the bigger the chances workers feel more empowered/invested to make an impact. It’s important that workers know that they have a degree of influence and that companies don’t only listen but also execute on their ideas. Survey’s, employee engagement tools or town halls are a great start to stay in dialogue with your workers.?

Transparency / open source development

In blockchain, information or transactions are stored and encrypted on a distributed ledger. Through a public key or a digital wallet, all that information is visible and secured. The information is pseudonymous meaning that in web3, your wallet is your identity, which isn't easily linked to your real identity. So while someone might be able to see the activity of someone's wallet, they won't know that it's your wallet.?

A web3 company called status.im publishes their HR documentation on public pages. From HR policies around holiday, to onboarding and a team lead manual as they embrace transparency and open source development. Most web3 projects are also transparent about their compensation ranges.

In many companies, crucial information is still hidden for employees where there is no real benefit in doing so. Transparency has a huge pull factor when attracting highly skilled talent.

Smart contracts / Automation

Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met. They typically are used to automate the execution of an agreement so that all participants can be immediately certain of the outcome. They are for example used to execute on a decision after a DAO vote.?DAO votes can be about anything including budget approvals.

Smart contracts are a great example of automation. Where in organisations there are often many manual processes that are repeatable and durable. Smart contract thinking can help to automate manual processes as much as possible, freeing up time that you can spend on meaningful human interactions and creating better employee experiences on the elements that you can’t automate. Pay-roll, contract management, OKR tracking and employee performance review tracking can all be automated as the framework used rarely changes.

Crypto is borderless

The cryptocurrency landscape is slowly but steadily changing the way that we do business around the world. Having a currency that’s free of governmental influence and the prospect of leveraging payments across borders without the meddling of banks and bureaucracy is very appealing.

Web3 have taught us that organisations (not all organisations) can work distributed across borders. While many companies are still struggling with remote or hybrid teams due to lack of trust or process, web3 companies got really good at determining how accountability and impacts look like and is measured. Time spent in the office is not an important metric, business impact is.?

The ability to work in distributed teams comes with a lot of other benefits for companies.?Your talent pool increases tremendously which gives you a competitive edge. Locally the competition is tough but much more doable on a European stage. Last but not least, distributed teams allow you to hire more diverse teams, improving your company and products.

Blockchain embraces the gig economy

Many web3 companies are known to rely on freelance contributors or even volunteers to curate and improve their products. Some workers contribute for free to the Ethereum foundation or the Bitcoin network as they are working on something bigger, an ideology that goes beyond building “just a product”.?Some others get rewarded by completing "bounties" or contractor work.

Web3 is the perfect example of how the gig economy works in practise. Workers are looking to work on accountable and impactful projects when they want without having the restriction to work for just one employer. They don’t mind the responsibility as long as they are fairly contributed and are given the right access.?With the increasing demand for top talent, the need for flexible work and under what conditions will increase as well. Companies will no longer just employ large populations of permanent employees.

I'm very excited about the future of work and HR. Do you have any feedback or questions? Please let me know in the comments or send a DM.