How do medium/large recruitment agencies adapt their organization in order to stay competitive with LinkedIn in the future? - Focus on recruitment in the pharmaceutical sector

Companies nowadays are increasingly confronted with disruptive innovations within their sector. These disruptive innovations can have a significant impact on the firm’s performance. LinkedIn can be considered as such a disruptive innovation, disrupting the sector of recruitment agencies. LinkedIn owns a huge amount of data. This data is very valuable for both recruitment agencies as companies. Companies are increasingly insourcing their recruitment services because through LinkedIn, they can have access to this huge amount of data too and recruit profiles themselves. I explore how recruitment agencies are adapting their organization in order to stay competitive in times when LinkedIn is disrupting their market. Drawing upon the theory of organizational identity, I explore how the perception of identity influences how and why recruitment agencies will respond to LinkedIn. I will use the framework of Geurts (2017). We argue that the activities of an organization are an expression of enduring, central and distinctive aspects of a firm’s identity. When faced with a disruption, those three aspects of the firm’s identity will be challenged. We identity two groups. Group A does not perceive its identity challenged because of LinkedIn. They will not change their central core activities because they are convinced that the existing ones will stand the test of time (i.e. because they are niche recruiters, because they target SME’s etc.) The attributes that distinguishing them from other recruitment agencies also remain the same. The identity shift noticed is identity affirmation. The other group does perceive its identity disrupted by LinkedIn after a while. They will feel the pressure to change their central core activities because the ‘old’ ones, will not be sustainable anymore. Group B notices that their distinguishing attributes do not distinguish them anymore rom other firms, thus they will change. The identity shift noticed is identity acculturation. We can conclude that most firms do not perceive LinkedIn as a threat but as a tool that brings a great added value to the company. However, some agencies did feel a negative impact of LinkedIn on their business. Even though all agencies buy services from LinkedIn, some of them also try to differentiate themselves in order to stay competitive with LinkedIn. The response strategies identified to differentiate from LinkedIn were becoming more of a niche recruiter, becoming a career advisor and putting more emphasize on the human service. All agencies mentioned that the ‘human touch’ they offer is their greatest added value. My findings improve the understanding of possible response strategies of recruitment agencies within the pharmaceutical industry faced with a disruptive innovation. It also gives more insight on the influence of organizational identity on firm responses.