Journal of Positive School Psychology [Link]

com
2022, Vol. 6, No. 11, 700-706

Impact Of Talent Management On Organisational Performance-

Mediating Role Of Talent Acquisition, Talent Retention, And
Employee Engagement

Dr. Muddangala Naresh Babu1, Dr. MRS Suryanarayana Reddy2, Dr. E.

Gnanaprasuna3, Dr. Y. Madhavi4, Dr. S. Susendiran5

1
School of Commerce and Management, Mohan Babu University, Tirupati. nareshbabu.m@[Link]
2
Department of MBA, KG Reddy College of Engineering & Technology, Hyderabad, drsnreddy@[Link]
3
Department of Management Studies, Sri Venkateswara College of Engineering, Tirupati.
gnanaprasuna95@[Link]
4
Department of Management Studies, Sri Venkateswara College of Engineering, Tirupati.
yabakulamadhavi@[Link]
5
School of Commerce and Management, Mohan Babu University, Tirupati. susendiranmba@[Link]

ABSTRACT

Organizations in the present scenario are immensely keen to have the best strategies for managing
talents. However, acquiring great talents and retaining them has been one of the typical issues faced by
organizations, especially in terms of Organisational performance it is very much needed. Another key
component that strengthens the relationship between talent management and Organisational
performance is employee engagement. Using a structured questionnaire as a survey instrument, we
collected data from 382 responses from select organizations and tested the proposed hypotheses by
framed conceptual model. The result indicates that the relationship between talent management and
organizational performance is fully mediated by talent acquisition and retention but the same
relationship is partially mediated by employee engagement. Finally, appropriate recommendations were
offered to HR managers and talent management heads of the organizations.

Key Words: Employee Engagement, Organizational Performance, Talent Acquisition, Talent

Management, Talent Retention,

Introduction The performance of a company's employees

determines its success. Employees with a
Considering the methods of managing talented
specific skill set will help an organisation stand
employees, organizations are not required to
out from the competitors. HR managers must
have a traditional mechanism while recruiting
focus on both retaining and hiring talented
since advanced machine learning algorithms
personnel in today's competitive environment.
are meant for it. Machine learning tools
Management of talent is a challenging and
recognize and contact potential candidates
crucial responsibility. The acquisition of the
much faster than recruiters do. Nevertheless,
proper people contributes to the success of the
employees have sufficient time saved from their
company's plan. Despite the fact that the current
on-job role as an artificial enabled chat box
global economic situation has increased the
system answer all the question they have.
number of individuals looking for employment
Talent acquisition and management have
around the world, there is still a considerable
become much better due to technology
skill gap in numerous industries and countries,
interferences.; Talent is increasingly a crucial
resulting in an increase in the problem of "talent
source of competitive advantage for businesses.
701 Journal of Positive School Psychology

mismatch." When multitasking abilities are is the final step of TM, and it comprises
required, talent acquisition is becoming encouraging and engaging the firm's talent pool
increasingly tough in today's business world. to improve their commitment to the
As a result, it's becoming increasingly difficult organisation.
to locate the "right" person for a job. Businesses
(Sivathanu & Pillai, 2020) revealed that HR
are concerned about not only attracting but also
managers face a difficult problem in retaining
maintaining excellent staff. HR must act more
high-performing staff. These workers must be
strategically in the changing business landscape
engaged and inspired to work hard. To keep
in order to enhance employee engagement,
them, HR managers are implementing
which is a vital tool for talent management. The
strategies such as providing competitive
hiring, promotion, and termination of
compensation structures, difficult work, future
employees are all aspects of talent
skill training, timely feedback, and reward and
management. In the relationship between talent
recognition. Using AI and cloud-based TM
management and organisational performance,
software, technology is assisting in the
this research attempts to investigate the
utilization of these services. These softwares'
mediation effect of talent acquisition, talent
predictive analytics data is offering an early
retention, and employee engagement.
warning for HR managers to predict employee
Literature Review attrition which can be avoided by intervening
before the employees depart. Employee pulse
Talent management
surveys, which provide insights on existing
Talent management became popular among HR employees' thinking and motivation, can be
practitioners around two decades ago (in the conducted quickly using technology(Meyers et
late 1990s). "As a significant motivation, 'The al., 2013).
War for Talent' (Rozario et al., 2020). HR's
Organizational performance includes financial
talent management focus was a global-local
performance, shareholder return, organisational
effort to guarantee that strategic decisions and
effectiveness, customer satisfaction,
operational HR operations were focused on
operational effectiveness, and other factors that
attaining competitive advantage through
lead to financial success. The purpose of TM
people. Talent management has come to be
and SHRM is to increase the efficiency and
understood as "a set of sustainable
performance of organizations. Organizational
organisational strategies that use human capital
performance can be achieved when human
to the organization's competitive advantage, as
resources are aligned with the organization's
well as a portfolio of integrated HR activities
operational system. Employee productivity,
that result in putting the right people with the
financial performance, and employee turnover
right competencies in the right job in the right
are all measures of the contribution of SHRM
place, at the right cost," as practiced by global
practices to company success (Mohammed Sani
and innovative firms(Claus, 2019).
Abdullahi, Adams Adeiza, Fadi Abdelfattah,
Talent acquisition, according to (Pandita & Mobin Fatma, Olawole Fawehinmi, 2022).
Ray, 2018), is the process of attracting and
Lower attrition and simpler hiring are just a few
hiring high-potential personnel. Talent
of the benefits of an engaged staff, as is
development refers to the process of teaching
expanding a company's knowledge base and
existing talent to improve their competences
gaining a competitive advantage. However,
and abilities in order to respond to the current
tracking only employee engagement is not a
and future needs of the business in order to
major one. It's just one of the many positive
achieve organisational growth and construct a
outcomes that strive for at work. Employee
succession plan for key roles. Talent retention
engagement consists of three interconnected
Dr. Muddangala Naresh Babu 702

conditions: work that is meaningful, Research hypotheses were framed based on the
availability of variety and distractions, and literature support
social and organizational stability that makes
H1: Talent Management has a significant
work more enjoyable (Hongal & Kinange,
impact on Organisational Performance
2020).
H2: Talent Acquisition mediates the
Research Methodology relationship between Talent Management and
Organisational Performance
Both exploratory and descriptive research
H3: Talent Retention mediates the relationship
designs were used as research designs in the
between Talent Management and
present study since studying the effect of talent
Organisational Performance
acquisition, talent retention and employee
H4: Employee Engagement mediates the
engagement mediation in the relationship
relationship between Talent Management and
between talent management and organizational
Organisational Performance
performance has gotten less research in micro,
small and medium enterprises in India.
Employees working in the MSMEs companies Analysis and Results
in the state of Andhra Pradesh were approached
From table no:1 shown below, the details of the
for the purpose of data collection. All of these
demographic profile of the respondents can be
employees were considered as samples of the
detected. The study has more male respondents
study who were selected randomly (simple
who participated in the survey than those
random sampling). Prior permission was
females whose age is between 36 years to 40
received from top management for collecting
years. Respondents with an age group of 31 to
responses from the sample. A structured
35 years were also found significant in the
questionnaire was the survey instrument and it
present study. The majority of the respondent
has been developed based on the standard
was postgraduates (49%) and their job level
measurement scales. Moreover, the total
was found at the managerial level in the select
number of samples used for data analysis and
organization for the study.
hypotheses testing was 382. The following
Table No: 1 Demographic Details

Demographic Variable Category Frequency Percentage

Gender Male 121 31.7
Female 261 68.3
Age 21-25 30 7.9
26-30 47 12.3
31-35 76 19.9
36-40 121 31.7
41-45 32 8.4
Educational Qualification UG 149 39.0
PG 188 49.2
Others 45 11.8
Job Level Middle 135 35.3
Lower 60 15.7
managerial 187 49.0

Table no: 2 shows the mean response rate of deviation. Except for the items measuring talent
each variable in the study and its standard management, remaining all other items which
703 Journal of Positive School Psychology

measure organizational performance, talent positive. All the variables have got a positive
acquisition and retention, and employee relationship with each other.
engagement, the mean response was found

Table No:2 Mean, SD, and Inter–Correlation

Mean SD 1 2 3 4 5
[Link]
3.96 0.92 1
Management
[Link]
3.78 0.83 0.421*** 1
Performance
[Link]
4.12 0.42 0.521*** 0.489*** 1
Acquisition
[Link] Retention 4.03 0.87 0.314*** 0.389*** 0.643*** 1
[Link]
3.98 0.99 0.476*** 0.487*** 0.578*** 0.711*** 1
Engagement
Note: *** all the correlations are significant at 1% level of significance

Measurement Model than 0.90. RMSEA was observed with less than
0.08. Discriminant validity was ensured with
Confirmatory factor analysis was performed on
Composite reliability and Average Variance
the variables using their measured items.
Extracted critical values. All the variables were
Construct validity was assessed by all the fit
proved with more than 0.50 AVE which
indices suggested. We observed the fit indices
ensured composite reliability and the square
like chi-square ratio not more than 0.50, CFI
root value of AVE was found more than the
critical value more than 0.90, NFI critical value
inter construct correlations between the
more than 0.90, and GFI critical value more
variables (see table 3)

Table No:3 Discriminant Validity

CR AVE 1 2 3 4 5
[Link]
0.873 0.785 0.886
Management
[Link]
0.889 0.821 0.421*** 0.906
Performance
[Link]
0.902 0.832 0.521*** 0.489*** 0.912
Acquisition
[Link] Retention 0.912 0.856 0.314*** 0.389*** 0.643*** 0.925
[Link]
0.904 0.721 0.476*** 0.487*** 0.578*** 0.711*** 0.849
Engagement

Structural Model equation modeling method of analysis. The

result of the structural model is as follows: χ2 =
The conceptual model shown in figure 1 was
452, df= 134, p = 0.000, χ2/df = 3.373, GFI =
tested using Amos software. All the path
0.932, CFI = 0.945, TLI = 0.951 and RMSEA =
movements were the proposed hypotheses and
0.031, providing evidence of good fit.
this hypothesis was tested by the structural
Dr. Muddangala Naresh Babu 704

Figure No:1 Resulted Hypothesised Model

In the conceptual model, talent management management and organizational performance.

and talent acquisition explain 74.8 % variance Bootstrapped was based on 1000 re-sampling
in Organisational performance (R2=0.748), because Sobel test requires a large sample
talent management and talent retention explain size(Hayes & Preacher, 2010). Referring Sobel
78.1 % variance in Organisational performance test online calculator, we found that the Talent
(R2=0.781), and talent management and management and organizational performance
employee engagement explain 63.2 % variance relationship is fully mediated by talent
in Organisational performance (R2=0.632). acquisition ( Sobel Test Statistic = 2.567; P
However, talent management explains directly <0.001); talent retention ( Sobel Test Statistic =
57.1 % variance in Organisational performance. 2.671; P <0.001); and ( Sobel Test Statistic =
We found talent management directly 2.220; P <0.05). Coming to fit indices, the
influences organizational performance (β = conceptual model has got a good fit since all the
0.532; P < 0.001), talent management influence critical thresholds of: χ2 = 478, df= 134, p =
talent acquisition significantly ((β = 0.723; P < 0.000, χ2/df = 3.567, GFI = 0.911, CFI = 0.926,
0.001) in turn it affects organizational TLI = 0.941 and RMSEA = 0.061 were under
performance (β = 0.801; P < 0.001). talent recommended range.
management influence talent retention
Discussions and Recommendations.
significantly (β = 0.872; P < 0.001) in turn it
affects organizational performance (β = 0.889; Respondents have agreed positively towards all
P < 0.001). talent management influence the items that measure talent management,
organizational performance significantly ((β = organizational performance, talent acquisition,
0.662; P < 0.05) in turn it affects organizational talent retention, and employee engagement.
performance (β = 0.688; P < 0.05). Talent management strategies in an
organization significantly influence its
Mediation Analysis
performance (β = 0.532; P < 0.001). Talent
To run the mediation analysis in the proposed management and organizational performance
model shown in Figure 1. We used Sobel test relationship is fully mediated by talent
along with bootstrap standard errors to test the acquisition ( Sobel Test Statistic = 2.567; P
significant mediation effect of Talent <0.001). Talent management and
acquisition, talent retention, and employee organizational performance relationship is fully
engagement in the relationship between talent mediated by talent retention ( Sobel Test
705 Journal of Positive School Psychology

Statistic = 2.671; P <0.001).Talent management The present research study is an attempt to

and organizational performance relationship is examine the relationship between talent
fully mediated by organizational performance ( management and organizational performance
Sobel Test Statistic = 2.220; P <0.05). based on and moreover, it tested the mediating effect of
the results in the hypothesized model, we found talent acquisition, talent retention, and
that the talent management and organizational employee engagement in the relationship
performance relationship was significant such between talent management and organizational
that effective and efficient methods for talent performance. We found that all the three
acquisition or hiring and talent retention would mediators significantly fully mediated the
be the source for greater performance of the relationship between talent management and
organization. It is recommended to the HR organizational performance. Recommendations
manager and/or HR practitioners to incorporate were offered to the HR managers and HR
technology-enabled talent acquisition methods practitioners.
to attract new talents which guarantee
References
significant betterment in organizational
performance. Furthermore, talent retention is 1. Claus, L. (2019). HR disruption—Time
indicated as one critical component to already to reinvent talent management.
achieving financial success, shareholder return, BRQ Business Research Quarterly,
organizational effectiveness, customer delight, 22(3), 207–215.
and operational effectiveness as a result of [Link]
organizational performance. Developed 02
employee engagement would definitely bring a 2. Hayes, A. F., & Preacher, K. J. (2010).
high-level organizational performance Quantifying and testing indirect effects
therefore, organizations and HR managers in simple mediation models when the
should focus more on strategies to ensure constituent paths are nonlinear.
engaged employees are more in the Multivariate Behavioral Research,
organization. 45(4), 627–660.
[Link]
Limitations and Future Research
0.498290
The present research is intended to test the 3. Hongal, P., & Kinange, D. U. (2020).
mediating role of talent acquisition, talent A Study on Talent Management and its
retention, and employee engagement in the Impact on Organization Performance-
relationship between talent management An Empirical Review. International
practices and Organisational performance. Journal of Engineering and
However, the study has got its limitation such Management Research, 10(01), 64–71.
as it is very much related to the Indian MSMEs [Link]
sector only since managing talent in terms of 4. Meyers, M. C., van Woerkom, M., &
hiring, retaining for organizational performance Dries, N. (2013). Talent - Innate or
appears to be different for different sectors. acquired? Theoretical considerations
Future research studies can be considered as a and their implications for talent
future research scope. Adding to this, the role management. Human Resource
of technology as a moderator in the relationship Management Review, 23(4), 305–321.
between talent management and organizational [Link]
performance could be a chance for future .003
research. 5. Mohammed Sani Abdullahi, Adams
Adeiza, Fadi Abdelfattah, Mobin
Conclusion
Fatma, Olawole Fawehinmi, O. A.
Dr. Muddangala Naresh Babu 706

(2022). Talent management practices

on employee performance: a mediating
role of employee engagement in
institution of higher learning:
quantitative analysis. Industrial and
Commercial Training, 54(4), 589–612.
[Link]
ICT-10-2021-0075
6. Pandita, D., & Ray, S. (2018). Talent
management and employee
engagement – a meta-analysis of their
impact on talent retention. Industrial
and Commercial Training, 50(4), 185–
199. [Link]
2017-0073
7. Rozario, S. D., Venkatraman, S., Chu,
M. T., & Abbas, A. (2020). Enabling
Corporate Sustainability from a Talent
Acquisition Perspective. Journal of
Sustainability Research, 2(2), 1–35.
[Link]
8. Sivathanu, B., & Pillai, R. (2020).
Technology and talent analytics for
talent management – a game changer
for organizational performance.
International Journal of Organizational
Analysis, 28(2), 457–473.
[Link]
1634