Here is a related post I was about to make but thought it would be relevant as a comment.

"Why I disagree with LinkedIn endorsements"

I was having a discussion with a VP of Lending last week about a new company I am working on to supplement financial information for loan purposes. The topic of LinkedIn, credibility, and endorsements came up and he suggested that perhaps someday in the future loans could be based off of your endorsements. I disagreed, stating that I didn’t think endorsements were very accurate but couldn’t fully explain why. This was my analysis.

1) A break-down by LinkedIn contacts:
I have been endorsed by 26 people of the 845 (3%) I’m connected to on LinkedIn. I began realizing I didn’t know some of the people endorsing me so I created some criteria for my endorsers:
-Never met: 19% of endorsements
-Never done business with: 50% of endorsements
-Haven’t seen in 5+ years: 46% of endorsements
-Didn’t recognize their name and had to pull up their profile: 19%

2) I decided to Social Graph my profile and found that the largest categories of people I know are: 1) From the financial industry 2) CEOs or executives 3) Entrepreneurs 4) From Oregon/hometown/school alumni 5) Team members from my previous company. These all make sense because the last company I founded works with the financial industry, so my social circle has evolved to primarily entrepreneurs and people in the financial industry.

http://ow.ly/i/1h9IB

3) Of these groups, who arguably know me the best of anyone I had:

-0 active CEO’s or C level executives (non-entrepreneurs)
-0 co-workers or team members
-0 investors from my previous company (none of which are not on LinkedIn)

4) The first listed 2 endorsements of the initial 13 I selected became my #1 and #2 skillset.

Some thoughts on Endorsements

1) The quality of the endorsements has a ways to go.
-Endorsers often have a small impact on one’s real life, but can majorly impact one’s professional perception.
-It seems that a fairly high % of people who endorse have some type of vested interest be it getting business from LinkedIn, networking for jobs, gaining topic expertise or driving traffic.

2) Your mind is tricking you.
-People choose what is listed first: My #1 and #2 skills and endorsements were the first two skills listed.
-Visual Deception: People love graphs, they remember them. They also only remember a couple things about you, like your #1 skill. This is a terrible thing because by nature we automatically assume this person is not as good at the other things and we begin typecasting. Would you agree that your #1 endorsement is your strongest skill? Would you say you are twice as good as your #1 endorsement as your #2 endorsement? These are some of the impressions this is building.
-Group Think: If someone else thinks you’re good at X, you must be, so I’ll endorse that also. This creates an echo chamber.

3) The dynamic of endorsing people can get awkward, which may prevent accurate endorsements. Would you endorse your professor while taking a class from them? How about your manager while working for them? The owner of the company where you work?

4) Higher ups aren’t on LinkedIn. The people who arguably have the most “influence” on me as an entrepreneur are not actively on LinkedIn and certainly are not out endorsing people.

The bottom line is that a vocal minority may influence the majority so be careful what impressions your endorsements may give of you. The people who spend the most time on LinkedIn are probably not the ones you want determining who you are.

Disclaimer: Thank you to those who have endorsed me. I know you have done so with the intention of helping me and it is appreciated. This post is about the social flaws with LinkedIn’s Endorsements and also about the behavioral economics behind online social influence.