A recent Fortune Magazine article, How LinkedIn Will Fire Up a Career, provides a great example of social media delivering significant financial savings to Fortune 500 companies.
The article initially talks about how Accenture, a major player in management consulting, plans on hiring tens of thousands of new employees in 2010. Then, the author asks its readers "will Accenture be able to find you" and further discusses the importance of online visibility (specifically through LinkedIn). The article states: "If you don't have a profile on LinkedIn, you're nowhere."
I agree with this opinion and have commented on this point in previous posts. However, I believe there are other relevant insights from the article particularly LinkedIn's success in generating tangible return on investment (ROI) in Fortune 500 recruiting:
1. LinkedIn Saves Fortune 500 Companies Significant Money and Time
According to John Campagnino, Accenture's Head of Global Recruiting, a major recruiting firm's fees can cost $100,000 to $150,000 per person. Campagnino goes further and says: "Start multiplying that by a number of senior executives, and you start talking about significant numbers of dollars very quickly." In addition, online services like LinkedIn decrease the time it takes to fill positions by nearly 50%. Arlette Guthrie, Home Depot's Vice President of Talent Management, says time to fill a position is an important metric among recruiters.
In my opinion, these significant cost savings in money and time clearly demonstrate the financial value of social media. Having a well-respected business periodical like Fortune publicize these results will increase the credibility and adoption of social media in America's largest corporations.
2. Other Fortune 500 Companies Recruiting Successfully with LinkedIn
Here are some of the companies mentioned in the article on how they're successfully using LinkedIn (and these are major brand name corporations):
Accenture. Campagnino further elaborates that he plans to make as many as 40% of Accenture's hires in the next few years through social media. He says: "This is the future of recruiting for our company.
IBM. Annie Shanklin Jones, Head of IBM's U.S. Recruiting, says LinkedIn "is a great equalizer" and "gives the recruiter an opportunity to reach out directly to a candidate." She says, "LinkedIn is the most important social media site for reaching prospective hires." Also, the article points out that IBM was a first-mover in experimenting with social networking particularly for recruiting talent. It uses Twitter to broadcast job openings, and the company organizes its own talent communities.
Oracle. The firm found its CFO, Jeff Epstein through LinkedIn in 2008.
Home Depot. Guthrie says Home Depot uses LinkedIn to find candidates for difficult-to-fill jobs such as supply chain, information technology, and global sourcing. Their recruiters use LinkedIn to research potential hires, engage with them in groups, and respond to inquiries.
3. Fortune 500 Companies Target "Passive Candidates" by Using LinkedIn
Fortune 500 firms perceive that the most talented and sought-after candidates are those currently employed. Headhunters categorize these individuals as "passive candidates," and LinkedIn provides a target-rich population. Finding these candidates is difficult and explains why the recruiting industry is an $8 billion industry.
LinkedIn currently has 60 million members. A typical member's profile is a college-educated 43-year-old making $107,000. More than a quarter are senior executives. According to the article, every Fortune 500 company is represented on LinkedIn -- and that's why recruiters rely on it to recruit high-caliber talent.
In May 2009, JobVite published the results of its second annual Social Recruitment Survey. Here are some findings relevant to this post:
* 77% of respondents said they use social networks to reach passive candidates who are not actively seeing employment
* Among online sites used to research candidates, LinkedIn was first (76%) followed by search engines (67%), Facebook (44%), and Twitter (21%).
Bonus Round: Helpful Resources for Achieving ROI with Your Own LinkedIn Profile
I hope you feel this post made a good case for the financial ROI Fortune 500 companies are producing with LinkedIn. Here are some additional resources you may find helpful in achieving ROI with your personal LinkedIn Profile:
Photo Credit: From Flickr by Don Hankins