HRM smart contracts on the blockchain: emulated vs native
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HRM smart contracts on the blockchain: emulated vs native Ray Neiheiser1
•
Gustavo Ina´cio2 • Luciana Rech1 • Joni Fraga2
Received: 27 August 2019 / Revised: 23 January 2020 / Accepted: 28 January 2020 Ó Springer Science+Business Media, LLC, part of Springer Nature 2020
Abstract In the past years numerous scandals in hiring processes of public institutions revealed significant weaknesses of the existing process. This lead to a lose of trust of citizens and applicants in these processes. Besides that, even honest processes often lack transparency for applicants, the company and, in the case of public institutions, also for citizens. Distributed ledger technology has been used in numerous past projects to establish trust between entities. Especially smart contracts have been a useful tool to execute programs in this setting. Thus, in the context of this project we developed an approach based on smart contracts to decentralize this process and improve its transparency and reliability. We enhance the system with game theory mechanics to encourage reviewers and candidates to participate honestly, further increasing the likelihood of a fair selection process. Nonetheless, not all blockchains support smart contracts and their usage comes with an elevated additional monetary cost. Due to that, in the blockchain environment, many businesses only emulate smart contracts by executing them on external servers which improves the scalability but decreases the decentralization. In the context of this, we compare the advantages and disadvantages of emulating smart contracts compared to native smart contracts in our concrete usage example. Our approach, compared to existing solutions, can be employed on any distributed ledger which allows to store some sort of metadata on the chain resulting in a significantly lower creation and maintenance cost (up to 30 times cheaper). The developed solution and discussion gives useful insight into safety and cost considerations which have to be made when deciding between native and emulated smart contracts. Keywords Blockchain Smart-contracts Distributed ledgers Transparency
1 Introduction In each company or public institution there is a sector called Human Resource Management (HRM) which is responsible for hiring new employees. In past studies, it has been shown, that how well this organ performs has a
& Ray Neiheiser [email protected] Gustavo Ina´cio [email protected] Luciana Rech [email protected] Joni Fraga [email protected] 1
Departamento de Automac¸a˜o e Sistemas, Universidade Federal de Santa Catarina (UFSC), Floriano´polis, Brazil
2
Departamento de Informa´tica e Estatı´stica, Universidade Federal de Santa Catarina (UFSC), Floriano´polis, Brazil
significant impact on the overall performance of the company or institution [5, 17]. In this context, it is very important for the company as well as for the applicants that this process is as transparent as possible. For the company it is important to guarantee that the
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