Blockchain based background verified recruitment platform- SumSys

Executive Summary

•In information Technology-  education, skills, and work experience- amount to better career opportunities for individuals. Businesses increasingly seek out candidates with the right level of education and real world job skills

•The need for high quality employees create tremendous opportunities for people with the right education, skills and job experiences

•However, inflation of degree, skill and job experience is  making it tough for the companies to choose right candidates

•SumSys’s blockchain based platform will provide the profile authentication, profile selection and recruitment platform to help solve the issues for the clients

•Blockchain’s ‘trustless’ immutable proof of existence characteristics will provide permanent proof of the profiles  for the clients

Demand For Talent

•The economy of today is based on knowledge. As such, employers look for candidates for jobs with an increasing level of skill requirements. Our operations require that we get highly skilled candidates with authentic background checks

•Employers pay high amounts of referral bonus or head hunting fees to acquire candidates with good skills. The recruiting industry generated USD 428 billion in revenue worldwide in 2016 (EUR 386 billion), with the US, Japan and the UK making up a majority of the revenue

•In today’s competitive global market, employers are willing to spend a high percentage of revenues to find the right employee with good skill sets

•In the case of LinkedIn: Q3 2016 revenue is USD 960 million with 17% generated (USD162 million) generated from premium account subscriptions; 18%(USD 175 million) from marketing solutions, and staggering 65% (USD 623 million) from talent solutions.

•According to LinkedIn, it’s talent solutions help corporate recruiters share, find, and engage the best talent. Corporate Recruiter service at LinkedIn costs USD 9,000 per year per seat (user login)

Current Issues                                                          

•As demand for education and training become global, academic and training institutions are still very fragmented and silo-ed. Academic record verification and skill verification is a cumbersome process. In the US and many other countries, there is no nationwide academic record system.

•When it comes to skill, such as IT skill certification, the process is even more fragmented. While we trust the integrity of students and academic institutions, degree and grade reports could be altered or non-verifiable in many situations. Employer spend a huge amount of resources looking for candidates with the right skill set and even more resources to check references and verify academic record and skill certifications.

Degree Inflation

•Candidates list education and degree information that’s not accurate on resumes in order to gain employment or achieve a high position in industry. In a very high profile case in 2012, Yahoo CEO Scott Thompson was ousted after it was found that he padded his resume with an embellished college degree, ending his term at the company after just four months.

Skill Inflation

•In the staffing industry, businesses put high value on candidates with the right skill sets. It is not uncommon for job candidates to claim to have certain skill certification on resumes. It is entirely up to the employer to verify such claims. As certain Information Technology skills become increasingly in demand, claims of possessing certain IT certification, such as Big Data or Artificial Intelligence, are more common. Such certification is usually done by private organizations, and can be difficult to verify

Job Experience Inflation

Inaccuracies in job resumes are not limited to certain sectors, but instead are pervasive across industries. The following is some of the most notorious cases that took place in recent years.

•An MIT dean never received any college degrees despite claiming to have a bachelor’s and a master’s degrees

•Bausch Lomb CEO lied about his MBA degree. Ronald Zarrella had to give up his $1 million bonus when it was revealed that he never received his MBA from NYU like he claimed he did. He actually started the program, but never finished it.

•Former Harvard student, Adam Wheeler, fabricated SAT scores, letters of recommendations and transcripts to gain admissions and received $40,000 in grants. His background was revealed when Wheeler attempted to apply for the Rhodes and Fulbright scholarships in his senior year.

Cross Border Verification

•The global number of students who study abroad continues to rise with an annual increase of 10%. There were almost 5 million international students in 2014. The Organization for Economic Co-operation and Development (OECD) has projected that, with demographic changes, the international student population is likely to reach 8 million by 2025.

•It is often difficult to ascertain information regarding degree or skill level certification across borders.

•It is also difficult to judge the quality of education for degree holders from abroad, with the exception of well known universities.

HR Verification Omission

•According to a 2016 CareerBuilder survey, 75 percent of employers said they have hired the wrong person for a position, and of those who had a bad hire affect their business in the last year, one bad hire costs them nearly $17,000 on average

•Steven D. Levitt, the co-author of Freakonomics, and an economics professor at the University of Chicago cites research suggesting that more than 50% of job applicants lie on their resumes. Cover letters are notorious for embellishment and exaggeration.

Though many employers are performing background checks, 75 percent said they have hired the wrong person for the job. These employers say a bad hire has resulted in:

•Less productivity: 36 percent

•Compromised quality of work: 33 percent

•Lower employee morale: 31 percent

•Lost time to recruit and train another worker: 30 percent

•Cost to recruit and train another worker: 30 percent

•Employee’s managers or coworkers had to spend excessive time assisting bad hire: 29 percent

Most importantly, the majority of employment related verification are done after the initial resume screening process or in-person interviews. Most pre-employment verification process costs between $5- 65 per item. Considerable time and efforts are invested in the initial resume screening and interview processes, and would be wasted should the verification process discover any negative indicators.

A resume screening system that offers verified education, skill, and job history would be invaluable to recruiters and save businesses time and financial resources. It would allow recruiters to precisely find candidates with the desired education, skill, and job history before spending valuable time and efforts to fully engage the candidates.

Advantages of Blockchain

•Traditionally, any kind of credential verification has depended on the issuing institution or other trusted authority to confirm the authenticity of a credential. This is a time consuming and costly process. In case of the issuing organization ceasing to exist, records are lost and unverifiable. The blockchain provides a more robust solution in the form of a distributed network of recorded ledger. Blockchain cannot be easily altered or taken down. Blockchain removes single points of failure and ensures that records can be verified without any organizational dependencies.

•The blockchain logs transactions between parties, and can be used to verify:

•existence of a record

•record has not been altered since issuance

•identity of the issuing institution

•ownership of the record

•record has not expired or been revoked

•This is all done on a distributed and public system. All amendments and alterations of the record are also recorded in the distributed ledger, which provides a chain of evidence on the record as well.

•Once a record, in the form of a smart contract on the blockchain, has been cryptographically created and recorded on the blockchain, it cannot be altered or spoofed. Anyone attempting to impersonate an issuing institution will not be able to execute the smart contract. Decentralized key registries help map keys and institutions across different industries.

Economic Model

•The need to find the right candidate for a job is the fundamental economic driver of the SumSys .

•The fees paid by business users contribute to the health of the SumSys system. A portion of the fees are distributed to education and training organizations as incentives to provide verified information. A portion of the fees also contribute to the actual upkeep of the SumSys network.

Token on SumSys System – SumCoin

•The SumSys will provide an exchange medium to pay fees between users and other participants of the system in the form of the SumCoin. With support for heterogeneous back-end blockchain data sources in the SumSys, a common exchange medium will be needed. SumSys smart contract and multi-blockchain browser will have built-in support for SumCoin across different blockchain systems.

•Therefore, data providers from public blockchains, alliance blockchains, and even private blockchain would be easily rewarded with SumCoins. An even more important use of SumCoin is to establish an international education reputation and skill level market place. With SumCoin as the common method of value exchange in the SumSys, quality of education in different countries, institutions, and disciplines can be measured by a common and consistent token.

Sample- Economic Incentives

•The SumSys will operate onpublic blockchains, which greatly reduces the cost of operating a similar system in a traditional web environment

•In the case of Ethereum, with a properly written smart contract, the cost of execution is fixed at 21,000 gas. Given that the speed of transaction confirmation is not the most critical factor in our use case, the smart contract can be confirmed at a slower pace. When confirmation of transaction is done at around 60 seconds, the cost is at around USD 0.003 per record creation. For a sizable university, such as University of California, Berkeley, with a graduating class of around 10,000 students, the cost of creating digital proof of graduation for the whole class year is at around $30 per year.

•In the case of AntShares public blockchain, with an allocation of 10 free gas per smart contract, the SumSys system runs essentially free of charge in most situations. This greatly reduces the cost of maintaining the system. The economic benefits are shared with all the participants of the system.

•For businesses in particular, our system reduces the cost of verification, which directly translates reduction in cost of hiring.

•For academic and training institutions , our system removes the burden of maintaining a verification system, which in most cases requires personnel and IT equipment. This amounts to savings to operational costs. In addition, our system passes a portion of the fees paid by businesses to issuing organizations. This creates a positive economic incentive for issuing organizations.

For candidates , our system puts credibility into their credentials. Potential employers put greater trusted in verified education, skill, and work experience. Our system injects a higher degree of seriousness in employer queries, and provides students greater exposure in the job market.

Technical Implementation

•The SumSys will consist of four major components, and offer heterogeneous and multiple blockchain support:

1.Digital Identity and Mapping System - translates digital identity to real world names and well known institutions

2.On-chain Credential Creation System - supports batch creation and storage of credentials

3.Off-chain Data I/O System - external data input and output from web, database, feeds, etc.

4.Multi-chain Data Browser for End User - intuitive interface to credential created and stored on a number of heterogeneous blockchains, such as Ethereum, AntShares, Metaverse, etc.

•Identities of candidates and organizations in the SumSys are in the form of public encryption keys. Certificate/degree info are created and stored onto the blockchain by issuing organizations directly.

•Certificate/degree info include the digital identity of the corresponding candidates. All the information are stored on blockchain in an encrypted format. Through the SumSys browser, users may find candidates matching certain attributes in certificate/degree info. Query results will be resolved by the naming service into human readable format. Results are presented to the end user by the SumSys browser.

Since all the certificate/degree and employment information are entered into the system by the issuing organizations.

The credibility of the issuing organization constitute the integrity of the certificate/degree information. 

Architecture

Digital Identity and Credential Creation     

Since all the certificate/degree information are entered into the system by the issuing organizations. The credibility of the issuing organization constitute the integrity of the certificate/degree information.

Digital Identity

Digital identities of the participants of the system are stored in the blockchain in the form of public keys. 

The SumSys system will provide a convenient way of mapping public keys to Candidates, known issuers and their accreditation. Business organizations pay a fee in the form of SumSys coins to access the mapping information of real world identities and public keys in the system.

Credential Creation

Issuing entities create credentials by executing smart contracts that set the status of state of the smart contract. In the case of Ethereum, smart contract with state information are time-stamped and stored in the blockchain. This mechanism creates an immutable proof of existence.

Issuing entities such as universities, colleges and certification entities may include the recipient’s public key address, degree info, or even hashed value of photographs and paper degree files into the blockchain. Even though the blockchain can be downloaded into a node and scanned. The information contained in the SumSys system smart contract are only utilizable after resolution from SumSys’s identity mapping service. The state info (i.e. credential details) are presented in human-readable format through blockchain browser.

P2P encrypted document storage is utilized to store image and binary information associated with a certain credential. Once called upon, images and other binary files can be accessed by the SumSys browser, thus providing the end user a rich media experience accustomed to business users.

 One method of implementing such off chain data feed is through InterPlanetary File System (IPFS) . Images or pdf files associated with the recipient are stored on IPFS. Hashed addresses of such documents are used in the smart contract that generates the credentials, thus linking additional documents to the credential.

•Digital Identity Mapping System- As stated previously, digital identities of the participants of the system are stored in the blockchain in the form of public keys. Since SumSys is system that provides trustworthiness of credentials, anonymity is not a requirement for SumSys users. On the contrary, participants of the SumSys system would like to make their identities known to system queries.

•The SumSys system provides a mapping service to map public keys to identities of students and organizations.

•This mapping service is related to the SumSys Browser to the end users, and is transparent to the end user. Only during the presentation of query results submitted by the end user, would the mapping service resolve the identities of the public keys and present human-readable information to the end user.

Off Chain Data Sources

•In the SumSys system, only digital identities of the issuing entity and the recipient are technically necessary to constitute a verified credential on blockchain. In reality, more information may be useful for the user to gain more insight.

•Besides digital identities, there are other important information regarding a person’s credentials, such as grades, course work transcript, detailed degree information, skill certification information. These information will be accessible to queries through oracles i.e. off chain data sources.

•Furthermore, through dedicated oracle services, more information sources, such as web services, can be linked into the smart contract.

Dynamic Blockchain Browser

•The primary end user of the SumSys system is business organizations and recruiters in particular. A user friendly blockchain browser would be essential to business users.

•Ideally, the SumSys Browser would combine functionality of both a blockchain explorer and an SumSys wallet. Business users search candidates through the blockchain functionality and pay fees through the wallet functionality, all in the same browser application.

Multi-blockchain Support

•SumSys will cover the users globally. SumSys serves students from various countries studying abroad. Businesses recruiting internally use our system to find the best talent worldwide. SumSys needs to provide support for data stored on different blockchains operating on different technology platform and countries.

•SumSys operates through smart contracts for credential creation on various blockchains. Blockchain platforms that offer support for smart contracts with Turin-complete virtual machines can be used as the underlying blockchain layer for SumSys. (e.g. Ethererum, EOS, and AntShares) Although not necessary, blockchains that offer oracle access to off chain data would be more compatible with SumSys premium features, such as graphical credential certificates.

•The mechanism to establish multi-blockchain support is through the SumSys Browser. It is the end user interface for smart contracts to multiple back-end blockchains. The nature of the supported blockchain can be public ledger, alliance ledger, or even private ledgers. The SumSys Browser provides a human readable and user friendly interface to multiple blockchains.

Disclaimer- All the views expressed are author's and not of the employer.