Outsourced

How do we decide whom and what we place our trust in? Generally, you trust your parents and family members because you were born into their lives. You typically trust your spouse because there is an underlying attraction which facilitates its development. But how do you trust a stranger? How do you develop trust in a person or company that you know nothing about and have no references for? Especially if you are looking to place faith on someone who would be in the care of a something you highly value. How can you be sure that the duty of care will be upheld when you’re handing over the keys of your house to some strangers on Airbnb, or letting someone walk your beloved dog for you? When we lived in smaller communities, trust was entrenched as we knew our community members if not by first name at least by their family. But as our community size and diversity increased, trust has become harder to achieve. Nevertheless, despite increasing cosmopolitanism, trust is beginning to be reintegrated into our communities and peer networks are giving us the ability to do it.

This is the final segment in a three-part series that will talk about the “peer to peer network”. How it has affected getting hired, choosing services (from where to eat to transportation), and how they have influenced how businesses build trust with their clients.

Peer Networks: The Currency of Trust 

The trust crux has been at the centre of every heterogenous society since the dawn of human civilization. Ancient Hebrews used to recite a list of their patrimonial heritage until they found a commonly known ancestor between themselves and the stranger they wanted to do business with. Scandinavians found their work around by creating patronymic surname which announces the names or houses of their fathers or mothers (i.e. Leif, Eric’s son = Leif Ericson). Companies have followed suit, forging their own methods to establish trust. The ancient Athenian potter, Euthymides jovially etched his trademarked “hos oudepote Euphronios” to differentiate from his counterfeiters and Cadbury’s purple wrapping reassures consumers of their confectionaries that quality sweets reside inside.

These novelties worked in less crowded markets. Rarely did Cadbury ever have to worry about budding chocolatiers in East Bengal taking its market share, nor did Euthymides have to worry about Meso-American imports flooding his Delian market. A modern world as globalized and competitive as ours requires a new trust layer as our modern-day companies are discovering, so much more so when what is being exchanged is highly valued by the owner.

We have already seen how peer networks have affected modern hiring practices, and we discovered how a crowd-sourced network can make a non-existent restaurant London’s number one place to eat. Today we look at how we build trust with new companies via the peer network.

We are in the renaissance of personal data applications and services are being curated to meet the individual needs. Leading this vanguard of creative disrupters…Wag!. “Wag!” is personalized dog walking service that matches dog owners with local dog walkers and sitters. Wag! dog handlers go through extensive background checks and on top of that you can track your dog walker in real time and before you meet them you can view their profile on Wag!’s mobile app. While background checks and certifications help build trust the clincher for most Wag! users are the ratings and reviews available for each Wag! dog handler.

The reviews come from people just like you. This prompts the question, why do we put value in peer references for these service providers? The simple reason is that that they are other people, just like you. They are fellow dog owners that live in your neighbourhood and they care about their dog just as much as you. These are your people, your dog-owning peers. If they say they had a good experience with this dog walker, it must be right.  People trust others that fit into their own social group and seeing reviews from these people who are similar to yourself builds the bonds of trust needed to let a stranger walk your four-legged companion.  The owner of that profile has been okayed by others in the dog community and they are now allowed into your circle of trust. This phenomenon is known as “social proof” and it is the currency that propelled new economy companies like Uber, Airbnb, and Wag! to their initial success. While now you can forge Cadbury’s hue of purple or Euthymides’s signature it’s much harder to forge the identity of your neighbour or the opinion of your friend. Peer networks and social proof are the trust layer of this generation where trademarks or a leader’s word was to the last generation.

Now, like our previous two parts of this series suggests, the system itself is not infallible. The 6 references for a Wag! dog walker may not be totally authentic, and for all you know, your neighbour was paid to make a positive review. While trust can be a challenge to build, it’s easy to break and the internet offers a multitude of platforms for individuals to post online about their experience, many outside of the control of service providers. We have all seen what effect one viral negative post can do to a company in an order of minutes. We only need to recall Kylie Jenner’s infamous tweet that helped Snapchat lose $1.3 billion in stock value. This is the peril of businesses that build their livelihood on the foundation of the peer network. Positive reviews can create massive windfalls, but negative ones can decimate a company just as quickly – this is an unstable position for the businesses, employees, and customers. The speed of the fall is mainly determined by how much trust has been entrenched between users and the company.

This world is changing. Traditional gatekeepers have lost their position as venerated oracles of trust. Doctors are judged not by their degrees but what former and current patients have to say about them on Google Reviews. People are hired based on the skill set their peers have endorsed on LinkedIn, and people will choose a dog walker based on how they are reviewed by neighbours. The peer network has altered our behaviours, it has helped to build trust between strangers we want to transact with, and it has opened a new world to fraudulent representation. Like all advancements in our history, peer networks can be used for good or for bad but whatever future lies ahead one thing is for certain – it will be determined by our peers.

Outsourced

The world used to be a simpler place. To get a job you would visit prospective employers, hand in your resume, provide prestigious references, and wait for your call back. Today, the hiring process is more invasive than it has ever been. Before hiring, employers will view as many social media profiles as they can find, conduct a Google inquiry, and then call your provided references. By the end of the hiring process, your employer could know more about you than your own mother. What does this all mean for hiring transparency?

This is the first in a three-part series that will talk about the “peer to peer network”. How it has affected getting hired, choosing services (from where to eat to transportation), and how they have influenced how businesses build trust with their clients.

The Peer Employer: No References Required

Imagine this: Over lunch your friend asks you to recommend them on their newly updated LinkedIn profile. You break out into a cold sweat, and mutter, “of course”- knowing you cannot outwardly turn a request down like that from a friend. You just hope they eventually forget – but this hope is soon diminished by a smooth follow up message on Facebook five business days later. While you enjoy their company socially, you know that your friend does not have the best employment track record. What do you do? If you’re like me, you write them a recommendation (and endorse them for good measure). Why? Because they are your friend and you want to preserve that relationship. You also (with a little guilt) hope they reciprocate the gesture with an equally enthralling reference on your profile. For some readers, this might merely be a thought exercise but for the others who are like me, this is an all too real vignette of last weeks lunch date. This scenario is an example of why peer reviews most important element, trust, is also the source of its fatal flaw. It implies trust that was never there in the first place. This is interesting because the peer network is built of off building trust between companies and hiring employees, to customers and clients looking to build a relationship with a company and pay for their products and services.

Peer to peer networks are as old as human society. Traditionally, employers asked candidates for their previous employment record and references from past managers. The employer sought the attestation of the candidate’s skills from their peers – other employers. Increasingly today, employers are crowdsourcing the referral process. Sites like LinkedIn expand the community of peers from past employers, to associates, colleagues, and friends. The locus of legitimacy has moved from key opinion gatekeepers to the balance of public opinion. The future of candidate selection is anticipated to simulate how you might choose a restaurant. Look at the candidate’s reviews, check their menu of skills, and see if anyone important has written about them.

Many would say that this is a fantastic advancement in candidate selection. Not only do you get a bigger picture of the potential hire you also save time from tracking down references. So, where’s the fault in all of this? It seems to be a more holistic approach to candidate vetting. Yet, there is a reason everything is put online. The platforms we create for ourselves can be easily manipulated—even accidentally. The opening example of the planted recommendation is just one of many ways users can boost their profiles.

Another example of profile-boosting is LinkedIn’s endorsements feature. LinkedIn’s help webpage writes, “endorsing your connections’ skills is a way to recognize any professional abilities that you’ve seen them demonstrate. You may be asked to provide feedback on skills and endorsements. Endorsing your colleagues can also help you to maintain strong connections with the people in your network.” The idea of endorsing colleagues for their skills and hard work is a great idea. However, in practice, it is a mix of a popularity contest and does not always accrue to a genuine or accurate portrayal of an individual’s skill. Some users of LinkedIn will constantly endorse others at the click of a mouse, not because they genuinely know of someone’s skill, but because they hope their effort will be reciprocal and earn them an endorsement back. Of course, this is not always the case, as many LinkedIn users would prefer to make sure the endorsements given and received are genuine. However, the system still allows itself to be taken advantage of by those trying to make their profiles reflect higher upon themselves. It all comes back to trust and whether or not employers trust that peers, colleagues, and co-workers are being authentic when they recommend and endorse others.

A consequence of focusing on crowd endorsements over gatekeeper attestations is nothing less than a shift in trust from verifiable others to a personally curated picture of yourself by your crowd of peers. A user who is very active on LinkedIn could get several endorsements for multiple skills by being pushy versus having the actual skills and connections.

While online platforms can help recruiters find the perfect match for a new employee, the system is not infallible. Online identities can be falsified, the main issue with this is how legitimate that falsification looks on an individual profile. With a higher emphasis on recruiters looking online, it gives tech-savvy millennials the chance to be flashy and do what they can to impress possible employers. The main point being, while LinkedIn is a handy tool, for both the employer and candidate, don’t go ditching those required character references any time soon.