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Summary:

The IPO of LinkedIn is probably the most significant web stock issue since Google, so I wanted to take a moment to reflect on LinkedIn’s impact on the world of work. LinkedIn’s “digital resume” has become an important tool for connecting job seekers and employers

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The IPO of professional social network LinkedIn is probably the most significant web stock issue since Google, so I wanted to take a moment to reflect on LinkedIn’s impact on the world of work. Though ostensibly a general-purpose social networking tool for professionals, and nowhere near as big as Facebook in terms of number of users (LinkedIn has some 100 million users, compared with over 500 million on Facebook), LinkedIn has become an important tool for connecting job seekers and employers, notably introducing several key innovations that repositioned the standard social network profile as a kind of “digital resume,” complete with features with which a user can showcase their skills and demonstrate their professional reputation.

A Digital Resume

Like other social networking apps, LinkedIn enables its users to build a profile and connect with other users. LinkedIn differs from its competition because it defines a user’s profile in terms of work history, rather than other personal details. At its most basic, it’s simply an online version of the traditional printed resume, listing a user’s work history and academic qualifications. However, coupled with LinkedIn’s reputation tools, the profile becomes much more powerful, giving employers more insight into the capabilities of a particular candidate — an attractive proposition for both employers and job seekers.

A Way to Demonstrate Reputation

LinkedIn introduced two key social network profile reputation innovations: Recommendations and LinkedIn Answers. Recommendations allows users to post endorsements from people they’re worked with on their profiles, which are then associated with the particular job the recommendation is for; they’re like an online version of the traditional reference. Despite concerns that the Recommendations system can be gamed — users offering to give each other fake recommendations to bolster their profile, for example — it does provide a way for employers to screen candidates. Employers using LinkedIn Jobs can even limit applications to users with a certain number of Recommendations.

LinkedIn Answers provides a way for users to demonstrate their expertise by answering business questions posted by the community. These answers are then added to the user’s profile, enabling users to showcase their knowledge and providing potential employers or business partners with more information about a potential candidate.

Recommendations and Answers are complementary. While Recommendations can be used to assess what a particular user is like to work with, Answers is a way to assess a user’s knowledge.

The Future

While LinkedIn would probably like to be more than just a Web 2.0 job board, those functions drive a significant portion of its income, so it needs to make sure its digital resume stays relevant. While a LinkedIn profile was once the best way for people to showcase their skills and experience online,  there are now many more ways to measure a person’s digital reputation — Klout score, Odesk and Elance reviews, and Quora answers, for example — which arguably could be even more valid; LinkedIn will need to make sure it doesn’t get overtaken by these newer services.

Additionally, with an increasing number of freelancers in the work market, LinkedIn needs to cater to them specifically. Currently, LinkedIn’s Jobs section is heavily skewed towards traditional employment, while its Answers section is seemingly mainly inhabited by consultants and freelancers. It should reconcile this disconnect by providing a way for freelancers and consultants to find employment though the service, perhaps by modifying its existing Jobs section, or perhaps by integrating an Elance-like freelance jobs marketplace.

As Stacey noted when the IPO was filed, the funds raised should enable the company to make some savvy acquisitions to round out its business offering, perhaps even including acquiring some companies that currently provide services to freelancers, or reputation-based services. Whether those purchases and its own innovations will keep it ahead of competition like Facebook, the newer reputation-based start-ups, and even the traditional job boards like Monster.com, remains to be seen.

Photo courtesy Flickr user Coletivo Mambembe

  1. MerchantBook is a social networking community designed specifically for businesses. It is intended to create opportunities for companies to promote themselves, find cheaper suppliers, better service providers, and new customers. Companies create a profile and sell products, services, real estate, or anything else they offer. Visit MerchantBook.com to join or for more information.

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  2. Hi Simon,

    This in an interesting and informative post. Thanks. I’ve been a fan and user of LinkedIn since “the early days”. But I’m confused about one item. LinkedIn Answers is a great feature, but I’m not understanding how its “innovative” or considered a social networking innovation introduced by LinkedIn.

    My recollection is that wow this particular feature has been around on LinkedIn for years, there were a number of other major platforms hosting a “Q & A” feature at the time LinkedIn added the feature to their site.

    – Matt

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  3. You make some good points about the need for LinkedIn to continue to enhance ways for users to boost their digital reputation online. I’ve found LinkedIn to be extremely helpful in terms of some of the groups I’ve joined. I’ve found the members to be extremely knowledgeable and professional.

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