I love LinkedIn. But I do not trust LinkedIn.

For recruiters, it’s obviously a key tool, and clearly a brilliant invention that is part of a seismic shift in the way recruitment works. I wish I had invented it.

But I believe, that for agency recruiters, LinkedIn is not your friend.

Don’t get me wrong, we need to use LinkedIn, and become better at scouring its database for the nuggets that reside therein. We also need to use it for developing client prospect lists, and be sophisticated in building our personal credibility, profile and brand, via status updates and group discussions. That much is a crystal clear, to even dumb old me.

But I do start to get uneasy when LinkedIn is accused of illegally accessing users’ personal email accounts without permission, and subsequently ‘harvesting’ email addresses, which it then uses to send multiple emails that appear to be endorsed by the LinkedIn member. In fact US members of the site have filed a class action complaint, now before the courts. (For the record, LinkedIn deny these claims vigorously.)

Sure, that makes me nervous. But what worries me much more even than this, is that it is obvious that LinkedIn does not care about staffing companies. And I do not trust LinkedIn to act in our best interest. In fact they are doing quite the opposite, right now. While LinkedIn sells its recruitment packages to agency recruiters aggressively on one hand, seducing us to partner with them and eschew other forms of sourcing, they quite blatantly sell the same service to corporates using (and I quote from their marketing literature) lines like…

“We will reduce your agency spend and reliance”

They don’t even try to hide their disdain for our industry, as witnessed by the very blatant threat in their IPO prospectus, which read;

“We believe our solutions are both more cost-effective and more efficient than…… hiring third-party search firms, to identify and screen candidates.”

But even this does not cause me sleepless nights. An enemy identified, with its plan exposed, is possible to beat.

This does though.

I can’t help think that LinkedIn, being as smart as they are, know that 90% of hires are made directly, without agency intervention. They are also fully aware, indeed part of, the trend, for corporates building recruitment strategies that bypass agency recruiters.

It’s obvious then that the real market for LinkedIn is the corporate hiring manager, not agencies at all. That is where 90% of their potential market is after all, and it’s where the market sentiment is too.

Jeff Weiner CEO of LinkedIn laid out the plan as recently as December 2012

“Our vision at LinkedIn is to digitally map every economic opportunity in the world (full-time and temporary); the skills required to obtain those opportunities; the profiles for every company in the world offering those opportunities; the professional profiles for every one of the roughly 3.3 billion people in the global workforce”

The underlining is mine. Is that not clear? They want to own vacancy and job seeker matchmaking, globally. Temporary and permanent. Do you think their plans include keeping third-party recruiters in the game? 

I think not. Recruitment agencies will be road-kill as far as LinkedIn is concerned.

Add to this the fact that LinkedIn is adding new members at the rate of 2 per second. No typo there. That’s two new members – per second!

So if you were in the LinkedIn Boardroom bunker, would it not be clear?

Use agencies as a cash cow while we build our global database, but at the same time deftly seduce corporate hirers as well. Then, when our database is so compellingly strong and filled with the cream of global talent… BAN agency recruiters from our platform altogether!

That’s right. Ban agencies altogether.

Then, what a compelling sales pitch LinkedIn would have for their corporate client base. Their real target market.

“Mr/s. Corporate client we have the largest database of talent on the planet, and no recruitment agencies are allowed to touch them.”

This last part is unashamedly a conspiracy theory. I have no hard evidence to prove that is what LinkedIn plans. No one told me this.

However it is true that I made these exact statements at a recruitment conference in Sydney recently, to an open-mouthed audience listening in horror as I painted this doomsday scenario. And an executive from LinkedIn was in the room when I said all this.

And he was the next speaker at the conference. And I hung around to hear what he would say. Thought it might be entertaining.

It was. But not in the way I thought.

This is what he said;

“I agree with 95% of what Greg Savage said. Now on with my presentation”

No denial. No explanation. No comment at all.

Makes you ponder doesn’t it?

Do you trust LinkedIn? Have your say below.

****************************************************************************

The Savage Truth UK Masterclass in London is on November 22nd. Join us please.

****************************************************************************

Views: 3857

Comment by Barry Frydman on October 29, 2013 at 5:45pm

Sorry to tell you but it isn't going away. I would guess their penetration rate in the Canadian IT industry is 95%+

As we all know it provides a very simple and cheap platform for both recruiters and corporations to find both passive and active candidates.

Hence the value of being able to identify candidates is moving towards the cost of a minimum wage employee.

So  if your value add is identifying potential candidates you aren't worth very much any more.

 LI probably isn't interested in replacing minimum wage employees so don't worry you get to keep your job.

Bottom line if recruiting firms are going to survive they are going to have to evolve in conjunction with technology.

Comment by bill josephson on October 29, 2013 at 5:50pm

My view is all technology making passive/invisible candidates visible to employers is a threat to 3rd party recruiting sending our industry into obsolescence, or into Purple Squirrel unfillable job orders.

If companies can access qualified people without us, how can they cost justify using us and why do they need us? 

Comment by Feargall kenny on October 29, 2013 at 6:07pm

Great post Greg and an area I think about often. There is no doubt that agency recruiters are the ugly stepchild that Linkedin have to tolerate relative to their far preferred corporate client. I agree that there is a risk that down the road we will be heavily restricted or will have to pay a significant premium to use the platform. What is interesting to me is how we agency recruiters handle that and become less dependent on using the platform before it gets too big and too evil!

I think there is going to be an element of Linkedin hurting itself over time as it gets more powerful that could make that a reality though also. Two examples of that are spamming and privacy. Linkedin recruiter, in the wrong hands is a spam engine, and the value of an inmail to a candidate has dropped significantly in the past year alone. Privacy is also a concern. Linkedin's new Intro product brings up those issues in spades. I also think their recent moves with the recruiter product have gone a little too far - such as adding metadata (including resumes) to profiles rather than our own proprietary databases. Are any agencies actually using that functionality? If they are then we deserve having our fate out of our hands as our dependency on the platform grows. 

I think it is important that recruiters also embrace other platforms that take on linkedin in key areas - this article from Ben Evans  is worth a read if you haven't seen it as it asks where linkedin is vulnerable  http://ben-evans.com/benedictevans/2013/9/21/atomisation-and-bundling

Ironically, despite the fact that everyone tries to chip away at the glaring inefficiency with recruiters as man-in-the-middle of the recruiting market, i think there is a need for a platform that encourages the recruiter connection for job seekers instead of going direct. Maybe that is something we should all be getting behind instead of waiting for someone like Linkedin to undermine the market for us and then grumbling after the fact?

Comment by Rodney Armarego on October 29, 2013 at 6:08pm
seems to me that agencies are only just now feeling the pinch of the changing dynamic in the recruitment space, certainly many businesses have been affected buy the advent of the Internet. As a software professional I have sometimes been made to feel less valued by recruiters because of the abundance off overseas skills and this competition makes Australian software professionals dismayed so now the connectivity afforded by the Internet is also eroding the worth or value of recruiters who work hard to illicit the pertinent details and yet they get beaten to the goal posts by others who may be less adept at discerning the key drivers of workplace performance which go far beyond merely a set of technological keywords just as in software our standards have lowered because similar work can be completed at much much less cost. Compare this with the outsourcing of software support and development to countries like india where it is common for banks and large organisations like this to lower the standard of the code base and documentation in the name of increased profits now we are seeing the recruitment industry being likewise affected. To those recruiters who see little difference in having software done overseas in developing countries i suggest that recruiting is being reduced in quality in the same manner. As an outsider to recruiting it would be all too easy to belittle the talent of recruiters so the next time you have the choice off suggesting a non australian overseas software professional for a roll consider this erosion of your own profession 2 letter quality placements made by people who do not understand the specific nuances off recruiting professional. Welcome to our nightmare that is internet connectivity !
Comment by Rodney Armarego on October 29, 2013 at 6:12pm
Please excuse speech to text capitalisation etcetera in above comment.
Comment by Edward N. Woycenko on October 29, 2013 at 6:53pm

Technology is making people who would normally be invisible, visible.  Individuals who have not accomplished anything in their career now have a medium where they can jump up and down saying look at me.  Companies who think they can build championship teams with individuals on the internet are deluding themselves.  How many "A" or "B" players have the time or make the time to be involved in social media or place their resume on the internet.  If anyone has statistics on how many "A" and "B" players obtained career opportunities on LI or through social media, I would be very interested in those statistics.  The stats I have indicate that 80% of new hires last year never met the goals and objectives discussed during the interview.  The average length of stay for a social media hire was 1 year.  This contributed to over $5T in turnover costs last year, so I am trying to get my arms around the reduced cost factor LI is touting to their corporate brothers.

Comment by Keith D. Halperin on October 29, 2013 at 8:25pm

@ Russell: for a site that everybody moans and groans about, they seem to be making lots of money.

@ Paul: Quite true, and it also seems there are a very large number of crappy recruiters and firms, too and they don't show any signs of going out of business, either.

Comment by Keith D. Halperin on October 29, 2013 at 8:43pm

ISTM that the agencies/recruiters who provide high-touch, high-value add services which can't be no-sourced (eliminated), through-sourced (automated),  or outsourced (sent away) and are worth 30% fees have nothing to fear. They're like a fine USD $200 bottle of wine, to be opened and consumed on special occasions. The problems though are:

1) Most people can't afford a USD $200 bottle of wine vary often and

2) A lot of folks may WANT that expensive bottle, but they're not willing to pay for it so they'll try and get excellence on the cheap. They're The "G" of the GAFIS (Greed, Arrogance, Fear, Ignorance/Incompetence, Stupidity) that keep crappy agencies and independents going. 

My point: I don't think even many crappy agencies need fear being driven out by LI R at this point, unless they've been getting their placements exclusively/largely through it, and LI suddenly decides to lock 'em out.  If that's the case: "more's the fool, them"...

 

-kh

Comment by Rodney Armarego on October 29, 2013 at 8:48pm

A message for recruiters to combat linkedin. focus on the top 4 reasons for role placement failure. Tech skills is least important for a role...

The recruiters best weapon to beat linkedin is to start looking at the person first and the skillset second, skills can be learnt, but attitude and motivations are intrinsic.

aAlinkedin computer search cannot determine the top 4 reasons but you can, it can only look at the fifth keyword match of which hard skills and for what number or years. Yes a computer can do that part. Use your super powers and stop focussing on the techical skills as they can be fixed. Attitude cannot.

Comment by Rodney Armarego on October 29, 2013 at 8:56pm

Your ticket to beating Linkedin for placements is below.

Top 5 reasons for job failure..

Linkedin has the least reason covered. Its up to you guys to do the top 4 reasons and let employers know this.

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