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What does Microsoft's purchase of LinkedIn mean for recruitment?

So Microsoft bought LinkedIn – what does it mean for recruitment?

This move is the latest and certainly boldest in Microsoft’s expansion into the cloud services market, as well as their first real hint towards the recruitment market, and could prove to be revolutionary. The $26.2 billion acquisition of LinkedIn however is multi-faceted and needs to be examined from a number of different angles, all of which provide new opportunities for Microsoft, as well as potential pitfalls.

The reason that they paid the gargantuan sum was in order to unlock LinkedIn’s Intellectual Property (IP) and the Professional Networks vast data resources. This is the link between Microsoft’s Cloud and the company’s push into Big Data – a trend that has been going on for some time now and looks set to pick up pace. The acquisition of LinkedIn and the associated IP that this has unlocked is the key here. No doubt that the Professional Networking platform will continue to exist, but the coup is the data that Microsoft will have access to, data which enables them to tap-in to ‘Big[ger] Data, allowing the company to make business forecasts and adapt to market changes and demands more rapidly.

Naturally, this will have associations and implications on the recruitment market, but the question is to what extent.

LinkedIn’s vast databases house information on millions of candidates. Microsoft’s well-established and envied team of data scientists now have full access to all of this information and will be able to develop algorithms/search-strings etc. in order to interrogate and manipulate this data. I’d like to think that Microsoft would utilise this in-house expertise in order to further drive LinkedIn’s outputs both from a candidate and client perspective, but this is by no means guaranteed. Additionally, LinkedIn holds all sorts of data on companies – histories, employees, followers – as well as candidate information around employment history, education etc.

One possible output is the development of new careers sites. Microsoft have a good CRM, Microsoft Dynamics that can be used as a recruitment solution. Combined with the big data provided by LinkedIn, Microsoft are potentially in a position to push something to challenge Salesforce. Having a careers site integrated out-of-the-box with your ATS that is inherently linked into the largest professional talent pool in the world would be a strong proposition.

The incorporation of LinkedIn into Microsoft’s cloud services is another potential output. Microsoft recently launched its cloud services, combining its computers, tablets, mobiles and various software (Microsoft Office 365 being the best example). The move to incorporate LinkedIn within this cloud environment – as well as the potential integrations between LinkedIn’s InMail system and Microsoft Outlook are also vast – and is no doubt being considered by Microsoft CEO and man behind this move, Satya Nadella. We can only guess as to what such integrations might look like and where the touch points may be. What’s important to note is that ultimately, all of the data stored within LinkedIn’s servers is now at Microsoft’s disposal and any integration between Office 365, Outlook in particular, and LinkedIn will provide a powerful proposition in the Cloud Services market.

It is however worth bearing in mind Microsoft’s marquee technology acquisitions of the past have not been rip-roaring successes. One needs only look at the purchase of Skype, and where it is now, to see that Microsoft’s track-record in pushing companies on and developing them is not great. Microsoft have announced that they plan to keep LinkedIn as a separate entity – the exact opposite of what they did with Skype – and we mustn’t fall into the trap of assuming that the mere acquisition of LinkedIn will mean instant or future success. Microsoft will have to think long and hard about how they wish to integrate the world’s largest professional network into their systems, whilst being mindful of the fact that they want to use the platform as both a Candidate and Client Relationship Management system.

This provides a potential stumbling block in itself as many companies will steer clear – and rightly so – of sharing company information with a platform that is actively enabling competitors recruiters’ to poach their staff. Therefore, Microsoft’s approach will have to be extremely finely balanced if they wish to get the best out of LinkedIn.

So all in all, this move by Microsoft is not necessarily a massive game-changer for the recruitment market as on the surface the move looks more driven towards developing more sophisticated CRM and Sales Technologies. However, LinkedIn had begun to stall in terms of development/adaptation in recent years and access to Microsoft technologies and resources may well inspire and drive new developments across LinkedIn’s services, and by extension, across the recruitment market. We mustn’t forget that LinkedIn was a true revolution within recruitment and certainly has the potential to push the boundaries and innovations within our market once again.

Lazar Tomovic | Bid Manager

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