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MRR
39,12
Unlocking the “black box” in the
talent management employee
performance relationship
1546 Evidence from Ghana
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Abstract
Purpose – Combining insights from the social exchange and signalling theories, the purpose of this
paper is twofold: first, to investigate the relationship between talent management (TM) practices and
four dimensions of talented employees’ performance; and, second, to examine the mediating role of job
satisfaction and affective commitment on this relationship in the Ghanaian banking context.
Design/methodology/approach – Structural equation modelling was used to survey data from 232
employees who are part of a talent pool in the Ghanaian banking sector.
Findings – The findings of this paper showed that TM practices increase positive talented employee
performance of task, contextual and adaptive, whereas it reduces counterproductive behaviours.
Second, talented employee work attitudes of job satisfaction and affective commitment partially
mediate the relationship between TM practices and four dimensions of talented employees’
performance.
Research limitations/implications – This study used cross-sectional data; hence, conclusions
regarding causality cannot be made.
Practical implications – Management and organisations implementing and intending to implement
TM practices should implement and invest in TM practices that will trigger employee work attitudes to
achieve full employee performance.
Originality/value – This paper advances the literature by exploring the relationship between TM
practices and four dimensions of talented employees’ performance.
Keywords Job satisfaction, Ghana, Talent management, Affective commitment,
Employee performance
Paper type Research paper
Section 6 provided a discussion of the findings. Section 7 provides the conclusions and
implications, Section 8 states the limitations and recommendations.
2. Literature review
2.1 Talent management
Interest in TM research has surged over the past two decades, and empirical evidence
has begun to rise since 2012 (Gallardo-Gallardo et al., 2015; Gallardo-Gallardo and
Thunnissen, 2016). This is because all the resources an organisation may have, talented
employees and systems for managing them are the most valuable. The high demand and
employment of talented employees and managing them have become vital subjects for
discussion after the publication of McKinsey specialists who declared “a war for talent”.
However, there is still limited consensus as to the meaning and scope of TM and the
methods to study the construct (Lewis and Heckman, 2006; Gallardo-Gallardo et al.,
2015). Although approaches vary, TM usually focuses on the differential treatment of
high-performing/high-potential employees by organisations that are considered as key
professionals either at present or in the future (Gelens et al., 2013). One of the most cited
definitions of TM, which is also adopted by this paper, is given by Collings and Mellahi
(2009) as:
[…] activities and processes that involve the systematic identification of key positions which
differentially contribute to the organisation’s sustainable competitive advantage, the
development of a talent pool of high potential and high performing incumbents to fill these
roles, and the development of a differentiated human resource architecture to facilitate filling
these positions with competent incumbents and to ensure their continued commitment to the
organisation (p. 311).
Early definitions of TM concentrate on the individuals, but the focus has since shifted to
strategic positions that drive organisational performance (Minbaeva and Collings,
2013). This paradigm shift leads to the identification of “high impact” or “pivotal” roles
to be filled with talented employees. Iles et al. (2010) reiterate that TM is critical to
organisational success, being able to give a competitive edge through the identification,
development and redeployment of talented employees. Randall (2011) maintained that
with globalisation and technology, competitors can replicate every single innovation.
Consequently, talents are needed to keep innovation ongoing and continuous for
sustained competitive advantage. In fact, as the knowledge economy continues to
expand, the value of outstanding talents will continue to be recognised (Hetrick and
Martin, 2006).
Two perspectives of TM have been discussed in the literature. On one hand, the exclusive
perspective takes a narrow view and argues that TM system should cover specific
individuals who are considered as “high flyers”, “talented” and “A players” (Morton, 2005;
Iles et al., 2010; Gallardo-Gallardo et al., 2013). On the other hand, the inclusive perspective Black box
argues that every employee has “talent”, and that, ideally, every employee contributes to the
performance of the organisation (Mensah, 2015). Clearly, every individual’s role is part of the
overall performance of the organisation; however, some individuals have rare skills that
are crucial and contribute heavily to the competitiveness of the organisation. Added to this
is the fact that some positions are very strategic and contribute towards the achievement of
organisational goals than others (Boudreau and Ramstad, 2005). Therefore, adopting an 1549
inclusive perspective results in over investment and waste of resources when a star
performer is in a position with little potential for differentiation (Minbaeva and Collings,
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2013). In addition, the difficulties involved in recruiting, managing and retaining talents
make TM more exclusive in practice.
Another strand of research wonders whether TM is just a re-branding exercise of HRM.
On one hand, TM is simply viewed as a repackaging of old ideas under a new name, “old
wine in new bottles” (Lewis and Heckman, 2006; Cappelli, 2008; Iles et al., 2010). On the other
hand, TM is seen as fundamentally different from HRM and cannot simply be a
management fad (Chuai et al., 2008; Minbaeva and Collings, 2013). The difficulty of making
a distinction between HRM and TM is partially attributed to the lack of a common
understanding of TM in both academic and practitioner literature. The literature appears to
show a lot of similarities between HRM and TM, but workforce segmentation is generally
seen as the key differentiating principle between TM and HRM (Collings and Mellahi, 2009;
Minbaeva and Collings, 2013). Hence, TM is essentially about employee segmentation, as it
is not practical or desirable to fill all positions with “A” performers. In other words, TM
requires the HR manager to have a talent mind-set in investing in strategic positions that
drive organisational performance (Hatum, 2010). Doing this will lead to a deep conviction
that talents in strategic positions lead to better performance, as opposed to the notion that
people are our most important assets.
TM has been found to lead to higher job satisfaction (Collings and Mellahi, 2009;
Mensah, 2015), affective commitment (Chami-Malaeb and Garavan, 2013; Gelens et al.,
2015), higher retention rates (Bhatnagar, 2007; Hughes and Rog, 2008) and employee
performance (Gelens et al., 2014; Luna-Arocas and Morley, 2015). TM can reduce
expenses and labour costs and improve competitiveness (Jackson et al., 2009) and
business performance (Yapp, 2009; Ulrich and Allen, 2014). However, some researchers
have argued that TM is likely to have some negative consequences (Bothner et al., 2011;
Dries, 2013; Swailes, 2013). The segmentation nature of TM may discourage,
de-motivate, frustrate and cause dissatisfaction and jealousy of those employees who
are not in the talent pool, resulting in lower productivity or increased turnover (Bothner
et al., 2011). It promotes inequality, making it a sensitive matter (Gelens et al., 2013), and
exclusion from the TM pool could be interpreted as somehow inferior, which might lead
to lower self-efficacy (Iles, 2013; Swailes, 2013). Hence, Iles (2013, p. 303) put the question
“can TM be ethical?”. Pfeffer (2001) posits that TM leads to overemphasises on “A
players” to the neglect of team contribution, whereas Larsen et al. (1998) stresses that
talent label may lead to arrogance and complacency.
Figure 1.
Talent management –
employee
performance linkage
3. Research model and hypotheses Black box
Figure 1 shows an operational model linking TM to employee performance. The model
is adapted from various frameworks (Collings and Mellahi, 2009; Luna-Arocas and
Morley, 2015; Mensah, 2015). This framework is a blend of insights from the social
exchange theory (SET) and the signalling theory (ST). From the SET perspective, an
organisation that acts in positive ways towards employees creates reciprocity so that
employees generally respond in positive ways that are beneficial to the organisation 1551
(Blau, 1964). SET provides a helpful lens through which to understand the mechanisms
involved in how talented employees interpret and react to TM practices. Thus, TM
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revealed that employees who perceive that they have been identified as “talent” were
more likely to be associated with commitment than those who either perceive that they
have not been identified or do not know whether they have been identified (Björkman
et al., 2013). Gelens et al. (2015), in their comparative study of designated and
non-designated as high potentials, found that employees designated as high potentials
experienced more affective commitment than the non-designated as high potentials.
Hence, we hypothesized as follows:
H2. A positive relationship exists between TM and affective commitment.
Similarly, research has found a relationship between TM and employee satisfaction. In
a study of 198 public and private sector employees, Luna-Arocas and Morley (2015)
found a positive relationship between TM and employee satisfaction. Gelens et al. (2013)
concluded that TM leads to higher levels of job satisfaction, even though this is
mediated by perceptions of distributive justice. Bethke-Langenegger et al. (2011) found
that TM initiatives that are aimed at retaining and developing talented employees have
positive impact on job satisfaction of talented employees. Finally, two conceptual
frameworks (Collings and Mellahi, 2009; Mensah, 2015) argued that TM is related to
employee satisfaction. Indeed, the SET and the ST also serve as theoretical
underpinnings of the relationship between TM and employee work attitudes. Thus, TM
practices send a good signal to talented employees in the talent pool that their
organisation cares about their well-being, making them committed and satisfied with
their organisation. Accordingly, we hypothesized as follows:
H3. A positive relationship exists between TM and employee satisfaction.
performing employees (Meyer and Allen, 1997). Khan et al. (2010) found that employee
commitment has a positive and significant impact on performance. In other words, the
willingness to exert effort is mostly considered as a direct outcome of affective
commitment. Hence, we make the following hypothesis:
H5. A positive relationship exists between affective commitment and (a) task
performance, (b) contextual performance and (c) adaptive performance (d) but a
negative relationship with counterproductive behaviours.
4. Method
4.1 Sample
The banking sector is without doubt one of the sectors of the Ghanaian economy that
has visibly experienced the “talent war” mantra. This “talent war” is not only triggered
by the competition for talented employees between the banks (and potential new entrant
MRR of foreign banks) alone but also competition from multinational corporations. To
39,12 withstand and cope with this challenge, TM practices have been implemented by
Ghanaian banks. To this end, they have created better alignment between their TM
practices and business growth aspirations. Some of the banks have adopted internally
run academies as one route to address the challenge of the talent shortage as the labour
market continues to heat up (PricewaterhouseCoopers, 2014). The banks now have
1554 official positions for TM with names for such positions varying slightly (TM and
performance management; learning and talent development; leadership, learning and
talent development; etc.).
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4.2 Measures
All the indicators in this study allowed respondents to answer on a five-point Likert
scale (1 ⫽ strongly disagree, 5 ⫽ strongly agree). TM practices were measured with five
items related to the banks’ deliberate practices in strategically managing their talent
pool. Instruments from previous studies (Chadee and Raman, 2012; Marescaux et al.,
here”. Affective commitment was measured with five items from the scale developed by
Meyer and Allen (1997). The affective commitment captures employees’ identification
with emotional attachment to and involvement in the organisation, and this has been
found to have a strong association with performance outcomes (Meyer et al., 2002).
In this study, we measured task performance using a five-item scale developed by
Koopmans et al. (2012). Sample item is “my quantity of work is higher than average”.
Studies that involve contextual performance often perceived the concept as
multi-dimensional (Van Scotter and Motowidlo, 1996; Motowidlo et al., 1997). For
instance, Van Scotter and Motowidlo (1996) divided contextual performance into two
separate dimensions: interpersonal facilitation and job dedication. They argued that
interpersonal facilitation consists of interpersonally oriented behaviours that contribute
to organisational goal, whereas job dedication centres on self-disciplined behaviours. In
a simple way, Koopmans et al. (2012) divided contextual performance into interpersonal
and organisational, which is similar to that of Van Scotter and Motowidlo (1996). We
measured contextual performance with eight items developed by Koopmans et al. (2012).
These items cover the two dimensions of contextual performance identified by scholars.
Sample item is “I often start new tasks myself, when my old ones are finished”.
Adaptive performance was measured using six items adopted from Koopmans et al.
(2012). Sample item is “I work at keeping my job knowledge up to date”. Although
counterproductive behaviours are often seen as one-dimensional construct, a number of
authors have divided it into two sub-dimensions based on the target of the behaviour,
namely, towards other individuals and towards the organisation (Mount et al., 2006;
Berry et al., 2007). We measured counterproductive behaviours using four items
developed by Koopmans et al. (2012). These items captured succinctly negative work
behaviours towards both other individuals and the organisation. Sample item is “I
purposely work slowly”.
using Harman’s (1967) single factor test. After performing this test, we found that the
simultaneous loading of all items in a factor analysis revealed four factors, with the first
factor covering only 12.787 per cent of the total variance explained, indicating that
common method bias in the data was rather limited (Podsakoff et al., 2003).
Construct
Construct Alpha AVE reliability 1 2 3 4 5 6 7
the acceptable range. The result of the measurement model is given as: 2 ⫽ 1019.768,
df ⫽ 506, p ⫽ 0.001, 2/df ⫽ 2.015, GFI ⫽ 0.901, CFI ⫽ 0.960, IFI ⫽ 0.971, TLI ⫽ 0.958
and RMSEA ⫽ 0.051. All the loadings are high (0.531-0.992), whereas all the path
estimates are significant (p ⬍ 0.001) (Byrne, 2009; Hair et al., 2010; Meyers et al., 2013).
Also, the indices of the structural model are as follows: 2 ⫽ 1045.827, df ⫽ 507, p ⫽
0.001, 2/df ⫽ 2.063, GFI ⫽ 0.893, CFI ⫽ 0.948, IFI ⫽ 0.948, TLI ⫽ 0.940 and RMSEA ⫽
0.053. Therefore, the data provided good fit indices, as obtained by both the
measurement and structural models, and are shown in Table III. In our model, TM, job
satisfaction and affective commitment account for 24.8 per cent of the variance of task
performance (R2 ⫽ 0.248); 31.0 per cent of the variance of contextual performance (R2 ⫽
0.310); 29.1 per cent of the variance of adaptive performance (R2 ⫽ 0.291); and 47.7 per
cent of the variance of counterproductive behaviours (R2 ⫽ 0.477). Again, TM accounts
for 9.6 per cent of the variance in job satisfaction (R2 ⫽ 0.096) and 7.8 per cent of the
variance in affective commitment (R2 ⫽ 0.078).
association between IV and mediator, sa ⫽ standard error of a, b ⫽ raw coefficient for the
association between the mediator and the DV (when the IV is also a predictor of the DV)
and sb ⫽ standard error of b. The results showed that job satisfaction mediates the 1559
relationship between TM and employee performance – task (Sobel test ⫽ 2.194, p ⬍
0.028), contextual (Sobel test ⫽ 2.586, p ⬍ 0.009), adaptive (Sobel test ⫽ 2.047, p ⬍ 0.040)
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6. Discussion of findings
The main objective of our paper was to examine the relationship between TM and four
dimensions of employee performance: task, contextual, adaptive and counterproductive
through job satisfaction and affective commitment. First, the findings showed that TM,
job satisfaction and affective commitment have relationships with all the dimensions of
employee performance. Second, we found that job satisfaction and affective
commitment partially mediate the relationship between TM and all the dimensions of
employee performance. Previous studies have found a positive relationship between TM
and employee performance (Luna-Arocas and Morley, 2015). However, these studies did
not examine employee performance from these four dimensions.
The modest contribution of our findings is that TM does not only lead to positive
performance but also reduces counterproductive behaviours. Thus, the implementation
of TM will lead to employee performance in terms of core job functions, contextual
behaviours, as well as creativity and innovativeness, while, at the same time, reducing
negative behaviours at work. These findings support the SET to the extent that when
organisations invest in TM practices, talented employees will compensate the
organisation with performance. From the ST perspective, investment in TM practices
sends a signal to employees in the talent pool to perform. Consistent with previous
studies, we found that TM is positively related to job satisfaction and affective
commitment (Chami-Malaeb and Garavan, 2013; Luna-Arocas and Morley, 2015; Gelens
et al., 2015). Thus, this finding showed that the implementation of TM is likely to induce
positive work attitudes of job satisfaction and affective commitment. This finding
provides support for the SET, which suggests that when organisations invest in their
employees in terms of TM practices and professional development, they are likely to
reciprocate their organisational investments in positive ways.
Our findings suggest that employee work attitudes of job satisfaction and affective
commitment are related to all the four dimensions of employee performance. This
finding also supports previous studies that have found a relationship between employee
MRR work attitudes and performance (Luna-Arocas and Morley, 2015; Mensah, 2015). Thus,
39,12 satisfied and committed talented employees are more likely to put in more discretionary
effort to the performance of their duties. At the same time, such employees will not
engage in counterproductive behaviours that will negatively affect the well-being of
their organisations and colleagues. Finally, we found that job satisfaction and affective
commitment partially mediate the relationship between TM and all the dimensions of
1560 employee performance. The finding generally supports the tenets of the SET in that TM
practices generate reciprocation in terms of performance through positive employee
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work attitudes.
studied banks. However, the practices included in this study are among the most widely
used practices in research and practice. The fourth limitation of our study is the
exclusive use of single source, self-report and subjective measures of all variables.
Subjective and self-report have been criticised to have many systematic biases related to
order, bias in inflating results and concerns about the common method bias. However,
Howard (1994) intimates that this may be less of a concern than is occasionally
expressed in the literature.
Based on the findings and limitations of this study, we make suggestions for further
research. First, even though longitudinal research is both expensive and time
consuming, future research would benefit from testing this study’s model through a
longitudinal research design so as to determine the causal links more explicitly. Second,
although this study has clearly demonstrated the importance of job satisfaction and
affective commitment as partially mediating the relationship between TM practices
and employee performance, other variables such as engagement, motivation and
perceived organisational support can be added. Again, our study only used sample of
talented employees. Therefore, the literature would benefit by comparing results from
employees designated as talents and non-talents to determine whether TM is solely
responsible for the relationships found in this study. Finally, further research is required
that would use subjective data either from superiors or co-workers. Archival data and
multiple raters can be used to collect data on employee performance.
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Corresponding author
James Kwame Mensah can be contacted at: mensjam@gmail.com
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