IBM wants to pacify subcontracting work thanks to blockchain

Working time, invoicing, payment… With “ Contingent Labor on IBM Blockchain », the multinational company proposes to manage all the processes related to the employment of external collaborators on the blockchain.

IBM is already present in the field of food traceability through its Food Trust program. He intends to develop the possible uses of blockchain in other industries, like Human Resource Management.

Big Blue is thus interested in the traceability of the tasks and processes related to the work of external collaborators within companies. With its software solution " Contingent Labor on IBM Blockchain ", The service provider proposes to record and manage these various operations (automatic follow-up of attendance sheets, orders, payment, etc.) on the blockchain.

Reconciling invoices: an expensive process

"One of the biggest problems common to all suppliers of subcontractors is the reconciliation of invoices" explains to IOC Burton buffaloe, in charge at IBM blockchain and logistics projects.

The blockchain is emerging in areas where there is friction and divergence, ”he adds.

A blockchain application could thus provide proof and confidence in the relationships between companies and their subcontractors. IBM itself faces difficulties in this sector. The company devoted significant human resources to validating supplier invoices. The result: an estimated average cost of $ 21 per invoice.

For its own needs, IBM therefore imagined a solution based on Hyperledger Fabric. The blockchain application allows suppliers to download invoices and purchase orders for their missions.

Automated billing and payment by smart contract

Each transaction between the participants in the blockchain network is stored in a record or "block", digitally signed to guarantee its authenticity and create a consensus on the state of the transactions.

Management rules have also been defined thanks to a smart contract. These allow for example to ensure that a subcontracted employee does not exceed the number of hours provided for in the order validated with the supplier.

The payment terms are also written in the logic of the smart contract in order to automatically trigger billing based on the approved timesheets stored in the blockchain.

IBM plans to commercially launch its blockchain technology this year. It thus targets a market for external collaborators valued at $ 400 billion, of which 2% each year is devoted to resolving disputes.