Article

Talent Management Practices and Employee Retention: Does It

Make a Difference?
Ali Mohammed Almashyakhi

Human Resource Program, Institute of Public Administration, Riyadh 11141, Saudi Arabia;
[email protected]

Abstract: The role of talent management is to ensure that employees’ special skills and talents are
identified, and that the right jobs are assigned along their career paths. This study examines the rela-
tionship between talent management and employee retention within the Saudi Arabia government
sector, specifically among civil service employees working for the Saudi government. A sample size
of 440 participants was used in the study. The results revealed that talent management practices
are positively related to employee retention. These findings highlight the importance for organi-
zations, especially in the public sector, to implement effective talent retention strategies to retain
their most skilled employees over the long term. This research contributes to closing the existing
gap in understanding talent management and retention within the context of Saudi Arabia’s civil
service sector.

Keywords: talent management; talent development; employee retention; human resource management;
human resource policies

1. Introduction
In today’s business environment, talent management is a vital topic as companies
recognize it as a competitive advantage and a valuable asset. Consequently, employee
retention involves encouraging employees to remain with the company as long as it meets
its goals and objectives [1–3]. It is recognized that many organizations are concerned
Citation: Almashyakhi, A.M. Talent
about employee retention; however, an organization must rethink its approach to talent
Management Practices and Employee
management in order to remain successful in a highly competitive environment. According
Retention: Does It Make a Difference?
to Ochurub and Alweendo [1], developing an integrated talent management approach is
Merits 2024, 4, 453–462. https://
essential to ensuring productivity, profitability, and sustainable growth over time. Therefore,
doi.org/10.3390/merits4040032
best practice organizations treat employee retention as a strategic issue, and human resource
Academic Editor: Luis Miguel teams, employee communications, and line management must work together to address
Ciravegna Fonseca the issue [4,5]. Management of talent is critical to ensuring an environment that is both
productive and positive for the employees. Additionally, talent management is influenced
Received: 5 October 2024
Revised: 29 November 2024
by anticipated skills, which vary according to an organization’s size, sector, and industry [6].
Accepted: 3 December 2024
As a result, organizations must rethink and reinvent their approach to talent management
Published: 5 December 2024 if they wish to maintain a competitive edge. To be successful in talent management,
several factors should be considered, including alignment with strategic goals, active CEO
involvement, HR management, the culture of the organization, and management processes.
Moreover, employee engagement, leadership development, human resource policies, and
Copyright: © 2024 by the author. organizational culture play an important role in retaining talent [3,7–12].
Licensee MDPI, Basel, Switzerland. Although talent management focuses on improving employee retention, it is equally
This article is an open access article significant to also attract, develop, engage, retain, and utilize talent [13–15]. It is common
distributed under the terms and
for organizations to have difficulty retaining outstanding performers, which adversely
conditions of the Creative Commons
affects the effectiveness of their leadership. In Saudi Arabia, organizations are experiencing
Attribution (CC BY) license (https://
a high employee attrition, including both public and private sector organizations [6]. For
creativecommons.org/licenses/by/
instance, the research reveals that Saudi Arabia’s hospitality industry is facing many issues
4.0/).

Merits 2024, 4, 453–462. https://doi.org/10.3390/merits4040032 https://www.mdpi.com/journal/merits

Merits 2024, 4 454

regarding employee attrition [14]. In 2014, Azeem and Nadeem [6] conducted research to
determine employee retention and job satisfaction among government sector employees in
Saudi Arabia. The research indicated that employees working in Saudi government sector
organizations were only mildly satisfied with the nature of their jobs, supervisors, and
co-workers. However, they were less than satisfied with their salaries and promotional
and career development opportunities [6]. A medium to low employee retention level is
not enough to retain talent. Saudi Arabia’s public organizations need an effective human
resource strategy to make employees fully commit. Talent management is one of the human
resource strategies that can have a positive impact on employee retention [5,16]. It is a
continuous process that involves attracting and retaining workers, focusing on their career
and skill development, and motivating them to improve their performance. Therefore,
Amushila and Bussin [17] examined whether talent management could contribute to
employee retention using a qualitative approach based on 39 middle-level administrative
staff. According to the study, organizations have not yet reached the level at which they
should be in terms of attracting and retaining talent. Additionally, some shortcomings
were observed during the implementation of the program, such as a lack of leadership
commitment [17].
As much as talent management practices are one of the most important concerns
for both leaders and practitioners, there are many challenges to overcome [10,18]. For
the purpose of retaining talent and preventing the loss of talent from the organization,
organizations employ a variety of activities and practices designed to enhance retention.
For instance, ref. [19] argues that companies should adopt strategies to retain their existing
employees in order to improve their ability to attract and retain employees at various
levels throughout their organization. Since there have been very few studies on this subject
in Saudi Arabia, the purpose of this study is to examine the relationship between talent
management and employee retention so that ways to improve it can be determined.

2. Significance of the Study and Research Question

This research has great significance for all organizations that aim to reduce the at-
trition rate of their employees. Organizations can retain talent by encompassing talent
management in their human resources strategy, as well as creating policies that are highly
beneficial for their human resources. It is also expected that organizations would be able
to increase profitability and productivity by implementing the recommendations of this
study [20,21].
A significant contribution of this study will be made to the field of human resources by
studying the relationship between talent management and employee retention. As a result
of this study, other researchers in the leadership and human resource fields may be able to
conduct further research that involves different variables or different research designs to
gain a better understanding of this phenomenon. In the end, this study could be useful to
government sector administrators in making the right talent management decisions.

3. Literature Review
Organizations can use talent management as an effective human resource management
strategy to retain their employees. Research has defined talent in several ways [9–11,15].
As an example, Narayanan [15] differentiates objective and subjective talent. Objectively,
talent is considered to be an individual’s innate abilities or personal characteristics, while
the subjective approach considers it to be an individual who is exceptional. Furthermore,
Kurdi and Alshurideh [22] compared exclusive and inclusive approaches to talent manage-
ment. In the exclusive approach, talented employees are the organization’s most valuable
assets, while the inclusive approach considers humanistic perspectives. According to this
approach, all the organizations’ resources should be distributed equally among employees
as each individual has potential [22].
A variety of techniques and human resource management practices can be used to
improve employee satisfaction and psychological well-being. As an example, coach-
Merits 2024, 4 455

ing, mentoring, and career development opportunities are the most effective talent
management practices. This results in stronger relationships between employers and
employees [14,15,18,23,24].
Many studies have explained that motivating employees can be accomplished in a
variety of ways [3,10,25]. Hussainy [10], for example, discussed the factors that must be
present in order for employees to remain motivated. According to the author, organizations
can increase their employee retention by taking care of two primary needs: lower-level
needs and higher-level needs. He identified physiological, safety, and social needs as the
lower-level needs, while the higher-level needs included psychological, self-esteem, and
self-actualization needs [10].
According to studies, talent management is a crucial element of human resource
management. It has evolved from a traditional practice into a strategic approach aimed at
attracting, developing, and retaining employees [10,21,26]. Today’s organizations face the
challenge of retaining a high-quality workforce in order to achieve operational excellence
and gain a competitive advantage. There are a number of challenges companies face when
trying to replace experienced and talented employees [8,10,17,21,26]. As a company seeks
to remain competitive, it finds it necessary to develop long-term talent management strate-
gies to attract, recruit, develop, and retain talent. Hence, companies need to be aware that
different factors contribute to the retention of talent or cause them to leave their organiza-
tions [26]. For example, Amushila and Bussin [17] stated that the compensation strategy
plays a significant role in retaining employees, improving organizational commitment,
and ensuring employee retention. In addition, Poisat Mey and Sharp [26] concluded that
an effective talent management strategy contributes to the retention and motivation of
employees, which in turn contributes to the success of the company.
To be successful, an organization must be able to compete in the market and retain its
employees. Having talented employees in an organization leads to several benefits for the
company. Some authors assert that employees are one of the most essential resources of any
organization [2,20]. For example, Shakeel and But [20] explain that employees with high
levels of performance and creativity are encouraged to stay with the organization, whereas
non-performing employees are encouraged to leave the organization. It is imperative
that organizations retain employees who are capable of contributing positively to their
productivity in order to succeed. The study showed that organizations’ success depends
on the ability of their workforces to remain productive, and, to do so, they must invest in
their human capital. Another study conducted by Fahim [8] explains that keeping talented
employees on board and keeping them in the organization would be a better and more
beneficial act when compared to hiring new workers.
Therefore, organizational performance is also affected by employee retention. There
has been a significant amount of research that has showed a positive correlation between
employee retention and operating performance within an organization [16,21,26]. For
example, WMTNK and Dilanthi [21] showed that there was a positive relationship between
employee retention and the performance of the organization. Thus, employee retention
was able to positively impact the financial and operational performance of the organization,
which was in line with other studies [8,22]. As a result, organizations could find it very
costly to hire a new employee as a substitute for a talented employee as the hiring cost can
be very expensive.
Moreover, an increasing number of organizations are becoming aware of employee
retention as a strategic tool that can be used to achieve a competitive advantage. An
organization can keep their talented workforce if they implement effective human resource
management programs. In a research paper by Khoreva, Vaiman, and Van Zalk [12], the
authors claim that initially, within the employment relationship between employers and
employees, employees often exchanged their loyalty, skills, and commitment for job security.
Despite this, due to increased competition and a volatile economic climate, job security has
declined in the current business environment [12]. Therefore, the implicit psychological
contract between employers and employees has become obsolete. Currently, employees
Merits 2024, 4 456

are examining human resource practices within an organization. An increasing number

of employees are looking for incentives and career development opportunities. For that
reason, most researchers agreed that positive human resource management practices not
only result in human resources with better commitment and lower turnover but also help
organizations predict voluntary turnover rates [8,10,15,21]. However, organizations that
implement effective human resource policies can enhance employee retention and increase
competitiveness. By using effective human resource policies and practices [10], some
organizations can retain top talent by transforming the employer-employee relationship.
To increase employee retention, various factors must be considered that directly affect
employees. Studies claim that employees tend to stay with organizations that provide
them with psychological and economic security, meet their individual self-actualization
needs, provide them with a sense of belonging, and foster an emotional attachment to the
organization. As a result, if all the factors are met, the employee will be able to become
more productive if these factors are met [7–9]. According to Bethke-Langenegger, Mahler,
and Staffelbach [7], they studied the effects of various talent management strategies using
138 Swiss firms. Research indicates that retention and development management positively
impact job satisfaction, motivation, commitment, and trust. Moreover, talent management
practices aligned with corporate strategies improve productivity, profitability, and com-
petitiveness. Furthermore, a study in the United Arab Emirates examines the impact of
talent management practices on sustainable organizational performance. However, an-
other study found that talent attraction has no impact on organizational performance, but
learning and development does. As a result, coaching and training can help managers
achieve sustainable organizational performance by helping employees learn and grow [4].
Furthermore, the purpose of the study conducted by Oladapo [25] was to learn more about
talent management challenges and why some companies do not have a talent manage-
ment system in place. The findings of this study indicate that organizations with talent
management programs recognize their strategic value despite significant implementation
challenges. Additionally, most participants cited advancement opportunities as a factor
affecting retention rates. In Kumar’s study [19], which supports the previous study, the
purpose was to examine the contribution of talent management practices to employee
retention. According to the results, employees tend to be attracted to companies offering
career development and growth opportunities as well as competitive salaries.
Moreover, as part of their research, Pandita and Ray [24] provide readers with infor-
mation regarding engagement and talent management in the workplace. It was suggested
in the study that an organization’s talent pool should be managed to ensure its employees
are engaged and dedicated, which in turn will result in long-term retention. Ultimately,
the paper proposes a model to improve talent retention by integrating talent management
practices and employee engagement initiatives.
Additionally, talent management processes involve planning, acquiring, developing,
deploying, retaining, and evaluating staff. For superior business results and competitive
advantages, HR planning should conduct talent audits to identify pain points and develop
career paths. An investigation conducted by Almomani, Sweis, and Obeidat [27] examines
the impact of talent management practices on employee job satisfaction in Jordanian
commercial banks. The results of the study demonstrated that talent management practices
were associated with improved employee job satisfaction.
Further, the dynamic business environment and volatile economic environment make
talented employees an important source of competitive advantage. In order to increase em-
ployee retention, one of the most widely implemented human resource initiatives is talent
management [13,19]. The implementation of talent management practices demonstrates
that organizations are concerned about the psychological well-being and career develop-
ment of their employees. Consequently, it can reduce employee attrition by improving the
psychological connection between employers and employees [16].
At this point, these employees need their organizations to appreciate and recognize
their efforts. Furthermore, they want to grow and develop their identities within organiza-
Merits 2024, 4 457

tions and in society. To satisfy their needs, these employees seek promotions and better
employment opportunities elsewhere. As a result, organizations need to provide career
development opportunities or promote talented employees to management positions at
this stage. It is also important to provide job opportunities that help employees realize their
self-esteem and self-actualization needs. It is also possible to improve employee morale
by offering mentoring, coaching, leadership development, and career development oppor-
tunities. Consequently, employees will not leave the company, and their job satisfaction
and commitment to the company will rise, as well as their commitment to the organization.
They will show their loyalty to the company by working harder and staying committed. In
contrast, employees who are exposed to a toxic work environment may consider working
for a competitor [2,10,17]. According to the literature, talent management plays a critical
role in retaining employees. It is crucial for every organization to ensure successful talent
management strategies are implemented and adopted.

4. Research Methodology
The purpose of this study was to identify and examine the relationship between an
independent variable (talent management) and a dependent variable (employee retention).
The research question guiding this study is: Do talent management strategies predict
employee retention? The following hypothesis can be drawn:

H1. Talent management is positively associated with employee retention.

Further, the study employs the quantitative research method, which emphasizes the
use of statistical or numerical analysis of data collected through various research tools such
as surveys and questionnaires [28]. An online questionnaire survey was used to collect
data for this study, which consisted of a series of questions distributed to participants.
Furthermore, the questionnaire asks for the respondent’s age, education background, and
employment history. Moreover, ten questions were included in the self-administered
questionnaire related to talent management practices, employee satisfaction levels, and
employees’ intentions to leave the organization.
In this study, data were gathered from Saudi government employees in the civil
service sector who work for the Saudi government. A total of 440 employees responded to
the online questionnaire survey. An analysis of the data was conducted using SPSS. The
independent variable in this study was talent management, and the dependent variable was
employee retention. A linear regression analysis was conducted to assess the relationship
between two variables.

5. Research Results
5.1. Demographic Characteristics of the Respondents
As shown in Table 1, descriptive information about the participants is provided.
The demographic information includes the gender, age, and level of education of the
individual. According to the gender factor, 52% of the participants were males and 47%
were females. In terms of the age factor, the 20–29 age group represents 38.64% of the
population, followed by 30–39, representing 44.32%, 40–49, representing 11.36%, and
50 years and older, representing 5.88%. In terms of educational levels, bachelor respondents
constituted 61.36% of respondents, followed by graduate respondents with 26.14%, and
lastly diploma respondents with 12.5%.
Merits 2024, 4 458

Table 1. Demographic characteristics.

Age Frequency Percent

29–20 170 38.64%
39–30 195 44.32%
49–40 50 11.36%
More than 50 25 5.68%
Total 440 100.0%
Sex
Male 230 52.3%
Female 210 47.7%
Total 440 100.0%
Education level
Diploma 55 12.5%
Bachelor 270 61.36%
Graduate Studies 115 26.14%
Total 440 100.0%

5.2. Pearson Correlation

Pearson correlation was conducted and presented in Table 2. The correlation depicts
the relation between one variable and another. This study analyzed the correlation between
talent management and employees’ retention, highlighting that the correlation value is
0.575 **. The value of correlation should be between +1/−1. This value depicts a significant
positive relationship, and they are highly correlated.

Table 2. Pearson Correlation.

Employees’
Talent Management
Retention
1 0.575 **
Employees’ retention
Talent Management 0.575 ** 1
** Correlation is significant at the 0.01 level (2-tailed).

5.3. Regression Analysis

These results showed in Tables 3 and 4 that talent management significantly predicted
employee retention (F(1, 191) = 174.15, p < 0.001). A total of 33% of the data variation in
employee retention was explained by talent management (R2 = 0.33, R2adj = 0.328).

Table 3. Model Summary.

Model R R Square Adjusted R Square Std. Error of the Estimate

1 0.575 a 0.330 0.328 5.23108
a Predictors: (Constant), Talent Management.

Table 4. ANOVA a .

Model Sum of Squares df Mean Square F Sig.

Regression 4787.170 1 4787.170 174.943 0.000 b
1 Residual 9714.281 355 27.364
Total 14,501.451 356
a Dependent Variable: Employees’ retention. b Predictors: (Constant), Talent Management.

As seen in Table 5, a similar attribute can be found in the talent management standard
marks row, as it identifies the gradient of the regression line that can be derived from
the regression coefficient (B). Based on this model, it is predicted that an increase of one
Merits 2024, 4 459

standard mark in talent management score will increase employee retention score by 0.394
standard marks for every grade increase in talent management score. The regression
analysis showed that there is a significant positive relationship between talent management
and employee retention.

Table 5. Coefficients a .

Unstandardized Standardized 95.0% Confidence

Coefficients Coefficients Interval for B
Model t Sig.
Lower Upper
B Std. Error Beta
Bound Bound
(Constant) 22.156 2.120 10.449 0.000 17.986 26.326
1 Talent
0.394 0.030 0.575 13.227 0.000 0.336 0.453
Management
a Dependent Variable: Employees’ retention.

Employee retention provides a research platform for establishing notable benchmarks

and highlighting specific factors relevant to reaching influential performance levels. As
part of the organization’s talent management procedures and protocols, a trust and sup-
port scheme are essential for fostering positive relationships between management and
employees. To fulfill that role, human resources practices must be implemented in a way
that establishes a strong connection between employees and management, facilitating
sustainable capacity and improving talent management.

6. Discussion
Developing an effective talent retention strategy can assist an organization in retaining
its most talented employees for a long period of time. For a company to achieve productivity,
talent management should be one of the most critical aspects used to ensure that talent
is healthy and growing. In light of the findings of this study, it can be concluded that
employers with better talent management tend to retain their top employees for longer
periods of time as a result of their better talent management practices. Whenever talent
retention is encouraged in an organization, it is more likely that talented and proactive
employees will be motivated and recognized for their contributions to the organization.
Human capital has become one of the most valuable assets of a growing number of
organizations over the last few years. Nowadays, companies face a challenge in retaining
employees in a highly competitive business environment. As a result, talent management
can be an effective means of retaining employees for organizations. Keeping skilled
employees on board is essential to maintain a competitive advantage over the long term. By
implementing talent management strategies, organizations can motivate their employees
and increase their productivity. Clearly, the findings of this study are consistent with those
of other authors and types of literature, indicating that talent management anticipates
human resource management activities to retain employees. Consequently, organizations
can improve their financial performance and operational efficiency. Studies have described
talent management activities as a range of human resource management activities that
include recognition, rewards, training, and development, as well as career and succession
planning [9,11,21,29]. In contrast, research has demonstrated that talent attraction does not
have an impact on organizational performance, while learning and development do. In
this way, coaching and training can contribute to the sustainability of an organization, as
well as to its productivity and growth [3,7].
Further, the results of this study confirm the findings of previous studies, which
demonstrated that employees prefer companies with talent management strategies [3,10].
As a best practice, companies should evaluate their promotion policies and modify them to
ensure that candidates are promoted only based on their performance. According to Al
Aina and Atan [4], rewarding employees more and providing them with opportunities to
Merits 2024, 4 460

utilize their strengths would be beneficial to the organization. Furthermore, if employees

are recognized, their concerns are addressed, and they have the opportunity to succeed,
they will become more motivated [15].

7. Conclusions
Retaining employees is one of the major challenges facing organizations that are trying
to remain competitive. Due to this, businesses need to recognize that their employees
play a crucial role in the success of the company. In terms of human resources, talent
management is one of the most effective tools that employers can use to ensure that their
employees remain loyal to them. In a number of studies, it has been shown that talent
management in the workplace enhances employee retention and enhances job satisfaction
for the employees [5,6,8,17,27]. It is also important to note that effective talent management
strategies can also boost the performance of an organization in addition to providing
a number of benefits [4,9,15]. As a result of these improvements, the retention rates
of employees have increased, and the motivation levels of employees have increased
significantly [20]. In the study presented here, there was a significant correlation between
employee retention and talent management, indicating a link between the two. The findings
of this study show that Saudi Arabian public sector employees perceive their organizations
to have policies that are effective in managing their talent. It may be concluded from
the results of this study that talent management activities do indeed improve employee
retention in the workplace. By following these guidelines, organizations will be able to
improve their financial and operational performance over time.
Accordingly, organizations should motivate their employees in order to retain them. It
is imperative that human resources managers update and improve policies related to talent
management and retention. Businesses can, for example, utilize internal talent pools and
develop compensation packages to maximize their pool of talent.
In conclusion, due to multiple factors, it is necessary to conduct talent management
studies in more cities and organizations. One limitation is the fact that medium-sized and
small companies have different cultures than leading public organizations. It is possible that
talent management activities in large organizations differ from those in small organizations.
It may be possible to find out which programs and practices can enhance the present factors
that are essential to employee retention, along with what can be done to facilitate employee
needs. Moreover, it is important to consider expectations and reality when describing
talent management programs. It is also helpful to compare organizational experiences
with those without talent management systems, and to understand why organizations
do not implement talent management. Additionally, it is important that future research
studies consider the limitations of the present study. Researchers should employ a variety
of research methods, including both quantitative and qualitative tools such as interviews
and questionnaires. It is recommended that the sample size be larger, and the size of
public organizations should be varied. Further, future studies should include additional
research on demographic variables in addition to talent management in order to increase
the relevance of the results.

Funding: This research received no external funding.

Institutional Review Board Statement: The study was conducted in accordance with the Declaration
of Helsinki, and approved by The Research and Studies Committee (protocol code IPA-11-0112 and
3 June 2024). The questionnaire and methodology for this study were approved, as were the ethics
approval and consent to participate forms. Participants were provided with detailed information
about the study’s purpose, scope, and the time required to complete the survey in the introduction
to the questionnaire. Participants were clearly informed that participation was voluntary, and
confidentiality and anonymity were assured because no identifying information, such as participant
names, was collected. In addition to providing contact information for the investigators, participants
were able to ask questions prior to participating in the study.
Informed Consent Statement: Informed consent was obtained from all subjects involved in the study.
Merits 2024, 4 461

Data Availability Statement: Data are contained within the article.

Conflicts of Interest: The author declares no conflicts of interest.

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