The Effect of Talent Management and Perceived
Organizational Support on Employee Retention Mediated by Organizational
Commitment
Susan Sabrina
Sitaniapessy, Armanu, Desi Tri
Kurniawati
Magister
Manajemen Fakultas Ekonomi dan Bisnis, Universitas Brawijaya, Indonesia
E-mail: [email protected], [email protected], [email protected]
Keywords |
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ABSTRACT |
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Employee
Retention, Talent Management, Perceived Organizational Support, Bank Industry |
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This study examines the effect of
talent management and perceived organizational support on the employee
retention at Bank Jatim KC Kepanjen through mediating organizational
commitment. This study uses saturated sampling. Primary data was obtained by
distributing questionnaires to 143 employees. Data analysis used partial
least square (SEM-PLS) structural equation modeling with Smart-PLS 3.0
application. The results show that talent management had no significant
effect on employee retention and perceived organizational support had a
positif and significant effect on employee retention. This study also found
that organizational commitment is able to mediate the effect of talent
management and perceived organizational support on employee retention.� From these findings, it was concluded that
talent management is not able to significantly increase employee retention
but talent management is able to increase employee retention through
increased organizational commitment.�
Furthermore, increasing perceived organizational support can improve
employee retention. |
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INTRODUCTION
Today globalization
makes companies operate in a complex, diverse, dynamic, competitive and
unstable environment
(Litvaj,
Ponisciakova, Stancekova, Svobodova, & Mrazik, 2022). In facing the challenges of globalization, companies need to manage
their human resources (HR)
(Horak, Farndale,
Brannen, & Collings, 2019). HR is a very important organizational element to be managed properly
because it functions as a driving force for the organization in an effort to
realize its vision and mission (Rahmayanti &
Permana, 2022). So a systematic and planned management is needed so that the desired
goals in the present and future can be achieved (Poff et al., 2016).
To achieve company
goals in the era of globalization, potential and quality human resources are
needed
(Arifin, Darmawan,
Hartanto, & Rahman, 2022). In this context, companies will compete to attract and retain
competent, skilled, and talented workers in the labor market and are faced with
the challenge of a talent war, a situation in which companies compete in order
to obtain the best talent available in the labor market. This situation is
experienced by companies in various industries including the banking industry (Omarini, 2018). Another impact caused by globalization on the banking industry is
shown by the presence of transformation towards the digitalization era (Shahzad, Ferraz,
Nguyen, & Cui, 2022). As a financial service provider, institutions in the banking industry
are starting to compete to realize this transformation through human resources
with superior competence and competitiveness in the era of digitalization (Winasis, Riyanto,
& Ariyanto, 2020).
Bank Jatim is one of
the Regional Development Banks in Indonesia engaged in the banking industry (Ratmono &
Frendy, 2022). Bank Jatim has a vision to become the number 1 BPD in Indonesia that
has a competitive advantage so that it can compete and even outperform other
banks, especially Regional Development Banks. Realizing the importance of the
role of HR in various efforts to achieve its goals, companies are required to
be able to develop an effective retention strategy approach to obtain and
retain quality human resources to remain loyal to the company (Sumarni, 2018).
Employee retention has
become one of the contemporary issues in human resource management (HRM) in the
banking industry and various other industries (Goldemberg,
Coelho, & Guardabassi, 2018). Table 1.1 shows that in the past 3 years Bank Jatim has experienced
an average decrease in the annual employee retention rate of 0.66%. During
2022, there were 79 employees who stopped working, an increase of 41 people or
48% compared to 2021. This becomes a problem if the employees who leave have
expertise, abilities, skills in their fields and occupy vital positions in the
company
(DuBrin, 2022). The loss of competent employees can potentially reduce company
productivity
(Litvinenko, 2020). Furthermore, companies need to find strategies to increase employee
retention in order to avoid significant losses in the long term in the form of
energy and money spent on investing in their human resources (Ansari and
Bijalwan, 2017).
Employee retention
will decrease when it is not balanced with the implementation of talent
management in a well-managed company (Wiradendi Wolor,
2020). Thus it can be concluded that retaining and obtaining the best human
resources from the labor market can be achieved by implementing talent
management practices
(Sepahvand &
Bagherzadeh Khodashahri, 2021). In this case, Bank Jatim has developed a HR management strategy
through the application of talent management which refers to the understanding
that competent and quality human resources are one of the capitals in the
competition. According to Gallardo and Thunnissen (2016), talent management can
be applied by carrying out organized identification, development, attraction,
engagement, retention and deployment of potential and efficient employees, to
occupy key positions that have a substantial impact on the sustainable
competitive advantage of the organization. The primary objective of talent
management practices and activities is to attract, select, recruit, develop,
and retain talent
(El Dahshan, Keshk,
& Dorgham, 2018).
In an effort to retain
talented employees, the company is expected to create a positive impression
where the company shows concern for them (Younis &
Hammad, 2020). The care and support provided by the company can influence employees
to feel comfortable with their work (Mihalache &
Mihalache, 2022). The support and care felt by these employees is known as perceived
organizational support (POS). According to Guchait and Cho in Shumaila et al.
(2020), more than 80% of employees want to work in a healthy and supportive
environment. High levels of POS within companies that lead to high job
satisfaction can reduce turnover rates (Robbins and Coulter, 2009).
Previous research has
concluded that employee retention can be achieved by implementing talent
management (Al Aina &
Atan, 2020). But different results were found in Ekhsan and Taopik's (2020) study,
talent management does not affect employee retention rates. Another study found
that employee retention can be obtained through perceived organizational
support (Putra and Rahyuda, 2016; Darmika and Sriatih, 2019; Arasanmi and
Krishna, 2019). However, different results were found by the study of Tews et
al. (2020), perceived organizational support has no effect on employee
retention.
Organizational
commitment is a sense of attachment that individuals have with their
organization
(Schmidt, 2016). Positive employee organizational commitment will support the
implementation of talent management in the company for the purpose of retaining
employees (Pramarta and Netra, 2018; Arocas and Lara, 2020; Arocas et al.,
2020).� Then research conducted by
Kurtesis et al. (2015), Kalidas and Bahron (2015), Putri et al. (2018) found
that increasing employees' sense of shout with the company is considered to be
achievable through increasing organizational support felt by employees.
�The company's goal to retain employees through
the implementation of talent management and the support that the company
provides to its employees can be supported by increasing employee
organizational commitment
(Kaewnaknaew, Siripipatthanakul,
Phayaphrom, & Limna, 2022). This idea is supported by Rostiana's research, 2017; Saraih et al.,
2017; Shumaila et al., 2020; which shows that organizational commitment has a
positive and significant influence on employee retention.
The model in this
study was developed from a combination of several studies by Pramarta and Netra
(2018), Arasanmi and Krishna (2019), and Tews et al. (2020). However, there are
differences in the variable indicators used, which are adjusted to the object of
research at Bank Jatim
(Orbaningsih,
Gitaria, & Budi, 2022). Referring to the description of research phenomena and problems
described above and the research gaps found regarding the relationship between
talent management and perceived organizational support to retention, further
studies are needed in research entitled "The Effect of Talent Management
and Perceived Organizational Support on Employee Retention Mediated by
Organizational Commitment" (Study on Bank Jatim Branch Employees).
METHODS
��������������� The
type of research used in this study is explanatory research with a quantitative
research approach to obtain an explanation of the relationship or cause and
effect among existing variables through hypothesis testing. Robson (2002)
explained that explanatory research is research that seeks to explore
situations, to find out what happened, look for new insights, ask questions,
and assess new phenomena through hypotheses. Explanatory research is then aimed
at providing an explanation of the relationship between phenomena or variables
(Sudaryono, 2016). Explanatory research with a quantitative approach is
research that relies on collecting and analyzing quantitative data (numeric),
using survey strategies and conducting measurements and observations, as well
as carrying out theoretical testing with statistical tests (Zulfkar and Budiantara,
2014). Thus, this research is expected to produce new knowledge that is not yet
known and can be started by exploring a wide area, concepts, and ideas, then
narrowing it down to be more specific through testing and analysis.
RESULTS AND DISCUSSION
After
testing the measurement and structural models in the previous section, the test
results can be used to test hypotheses (Verhaeghen & Salthouse, 1997).
Hypothesis testing is directly carried out to determine the effect of each
independent variable on the dependent variable. The reason for using the
structural equation modeling partial least square data analysis technique is
because it is suitable for using models with small samples and without using
normality assumption tests such as in multiple regression testing or path
analysis. In the rejection or acceptance of the hypothesis, research uses a
reference to t-statistical values compared to t-table values (Goldemberg et al., 2018). If the
t-statistic value is greater than the t-table value (1.96) then the
relationship of a variable is said to have a significant effect or the
hypothesis is accepted.
Table 1
Direct Effect Test Results
Hypothesis |
Relationship |
Path Coeffisients |
T Statistics |
P Values |
Information |
H1 |
Talent Management (X1) -> Employee retention (Y) |
0,092 |
1,744 |
0,082 |
Insignificant |
H2 |
POS (X2) -> Employee Retention (Y) |
0,708 |
13,371 |
0,000 |
Significant |
H3 |
Organizational Commitment (Z) -> Employee Retention
(Y) |
0,213 |
4,082 |
0,000 |
Significant |
H4 |
Talent Management (X1) -> Organizational Commitment
(Z) |
0,382 |
3,508 |
0,000 |
Significant |
H5 |
POS (X2) -> Organizational Commitment (Z) |
0,371 |
3,589 |
0,000 |
Significant |
Source:
SmartPLS output data processed by the author (2023)
The test results in Table 1 are equipped with
visualization through model path images�
by showing the coefficient value of each research hypothesis. The
model path �is used to provide an
overview of the relationship between variables and show the level of
significance in hypothesis testing.
Figure 1. Direct Influence Path of Structural Model
Based on the results of
the path coefficient test in Table 5.13 and visualization through Figure 5.1,
the results of hypothesis testing can be described as follows:
Hypothesis
1: �������������� Talent management has a
positive and significant effect �������������� on
employee retention.
��������������� The results of research data analysis based on Table
5.13 showed that the coefficient value of the talent management influence path
on employee retention was 0.092 or >0, t-statistic value was 1.744 or
>1.96 and p-value was 0.082 or >0.05. Based on these data, it can be
concluded that there is no significant influence between the variables of
Talent Management (X1) on Employee Retention (Y) or in other words Hypothesis 1
is rejected.
Hypothesis
2:
Perceived organizational support has a positive and significant effect on
employee retention
��������������� The results of research data analysis based on Table
5.13 show that the coefficient value of the perceived organizational support
influence path �on employee retention
is 0.708 or >0, t-statistic value is 13.371 or >1.96 and p-value is 0.000
or <0.05. Based on these data, it can be concluded that there is a positive
and significant influence between the variables Perceived Organizational
Support �(X2) on Employee Retention
(Y) or in other words Hypothesis
2 is accepted.
Hypothesis
3: Organizational support commitment has
a positive and significant effect on employee retention
The results of research
data analysis based on Table 5.13 show that the coefficient value of the path
of influence of organizational commitment on employee retention is 0.213 or
>0, t-statistical value is 4.082 or >1.96 and p-value is 0.000 or
<0.05. Based on these data, it can be concluded that there is a positive and
significant influence between the variables of Organizational Commitment (Z) on
Employee Retention (Y) or in other words Hypothesis 3 is accepted.
Hypothesis
4: �������������� Talent management has a
positive and significant effect on employee retention
The results of research
data analysis based on Table 5.13 show that the coefficient value of the talent
management influence path on employee retention is 0.382 or >0, t-statistic
value is 3.508 or >1.96 and p-value is 0.000 or <0.05. Based on these
data, it can be concluded that there is a positive and significant influence
between the variables of Talent Management (X1) on Organizational Commitment
(Z) or in other words Hypothesis 4 is accepted.Hypothesis 5:���������������
Perceived organizational support has a positive and significant effect on
organizational commitment.
The results of research data analysis based on Table
5.13 show that the coefficient value of the perceived organizational support
influence path �on employee retention
is 0.371 or >0, the t-statistic value is 3.589 or >1.96 and the p-value
is 0.000 or <0.05. Based on these data, it can be concluded that there is a
positive and significant influence between the variables Perceived
Organizational Support �(X2) on
Organizational Commitment (Z) or in other words Hypothesis 5 is accepted.
Indirect Effect Test Results
Indirect influence testing or called mediation test
has the aim of testing the interval of mediation variables based on theory
(Baron and Kenny, 1986). By conducting mediation testing, you can find out
whether existing mediation variables include perfect mediation or partial
mediation.
Table 2
Indirect Effect Test Results
Hypothesis |
Relationship |
Path Coefficients |
T Statistics |
P Values |
Information |
H6 |
Talent Management (X1) -> Organizational Commitment
(Z) -> Employee Retention (Y) |
0,081 |
2,614 |
0,009 |
Significant |
H7 |
POS (X2) -> Organizational Commitment (Z) ->
Employee Retention (Y) |
0,079 |
2,464 |
0,014 |
Significant |
Based on the results of
the indirect influence test Table 5.14, the results of hypothesis testing can
be described as follows:
Hypothesis 6: �������������� Organizational
commitment mediates the effect of talent management on employee retention
The results of research
data analysis based on Table 5.14 show that the coefficient value of the talent
management influence path on employee retention through organizational
commitment is 0.081 or >0, t-statistic value is 2.614 or >1.96 and
p-value is 0.009 or <0.05. The data show that Organizational Commitment (Z)
is able to mediate the effect of Talent Management (X1) on Employee Retention
(Y) or in other words Hypothesis 6 is accepted.
After obtaining
statistical t values in testing direct and indirect influences, then a
comparison was made between statistical t values in Table 5.13 and Table 5.14
to see the mediating effect in this research model. The statistical t value of
direct testing was 1.744 or <1.96 while after mediation testing the
t-statistic value was 2.614 or >1.96, which means that there is an increase
in effect when entering mediation. Therefore, it can be concluded that the
effect of organizational commitment as a mediating variable of talent
management on employee retention is indirect-only mediation.
Hypothesis
7: �������������� Organizational commitment
mediates the effect of perceived organizational support on employee retention.
The results of research
data analysis based on Table 5.14 show that the coefficient value of the
perceived organizational support influence path �on employee retention through organizational
commitment is 0.079 or >0, t-statistic value is 2.464 or >1.96 and
p-value is 0.014 or <0.05. The data show that Organizational Commitment (Z)
is able to mediate the effect of Perceived Organizational Support (X2)
on Employee Retention (Y) or in other words Hypothesis 7 is accepted.
After obtaining
statistical t values in testing direct and indirect influences, then a
comparison was made between statistical t values in Table 5.13 and Table 5.14
to see the mediating effect in this research model. The statistical t value of
direct testing was 13.371 or >1.96 while after mediation testing the
t-statistic value was 2.464 or >1.96, which means that there is a change in
significance or change in direction when entering mediation. Therefore, it can
be concluded that the effect of organizational commitment as a mediating variable
of perceived organizational support on employee retention is
complementary mediation.
Discussion
of Research Results
The
Effect of Talent Management on Employee Retention
��������������� The study found that talent management did not have a
significant effect on employee retention. Based on the results of data
analysis, it can be seen that talent management is not able to increase
employee retention or in other words the improvement of talent management is
positively in line with employee retention but does not have a significant
effect on employee retention. This research is in line with research conducted
by Ekhsan and Taopik (2020), where the study found
that talent management does not affect employee retention rates.
Proper talent management
practices can increase retention to achieve competitive advantage
through superior resource management. In line with this, Bank Jatim strives to
develop employee capacity and competence, the Company conducts talent management which aims to prepare,
develop and retain employees in order to display their best performance. Bank
Jatim Kepanjen Branch through�
the human capital �division is considered to be good enough in
implementing talent management, but companies still need improvements in their
performance management and rewards given by the company to employees to
increase retention. The basis for managing talent management used by Bank Jatim
consists of two aspects, namely competence measured through the assessment
process and employee performance. Competency measurement is carried out
regularly to update the latest capabilities of each employee at all levels of
position.
This research is not in
line with what was researched by Sumarni (2018);
Ratnawati and Subudi (2018); Pramarta and Netra (2018); who found that talent management had a significant
effect on retention.(Arpah & Nabella, 2023)
The Effect of Perceived
Organizational Support on Employee Retention
The
study found that perceived organizational
support (POS) has a significant influence on employee retention(Huang et al., 2021). Based on the results of data analysis, it can be seen that POS is able
to increase employee retention or in other words the increase in the higher the
POS variable, the higher the employee retention. This study is not in
accordance with the research conducted by Tews et al. (2020) which found perceived
organizational support had no effect on employee retention.
The
results of this study support other studies conducted by Putra and Rahyuda
(2016); Darmika and Sriatih (2019); Arasanmi and Krishna (2019) who found that perceived organizational support can
increase employee retention. The more the company values contributions and
cares about employee welfare, the greater the influence will be on employees to
remain enthusiastic at work and become an employee motivation to remain in the
company so that employee retention can be maintained.
The
Effect of Organizational Commitment on Employee Retention
The study found that
organizational commitment has a significant effect on employee retention. Based
on the results of data analysis, it can be seen that organizational commitment
can increase employee retention or in other words the increase in the higher
the organizational commitment variable, the higher the employee retention.
The results of this
study support the research conducted by Rostiana, 2017; Saraih et al., 2017; Shumaila et al., 2020; which revealed that
organizational commitment has a positive and significant influence on employee
retention. The more a sense of organizational commitment is formed in employees,
the stronger the desire of employees to remain in the company, for that the
company must continue to maintain employee commitment to the organization so
that employee retention is maintained and even increased.
The Effect of Talent Management on Organizational
Commitment���������
The research found that
talent management has a significant influence on organizational commitment(Almaaitah, Alsafadi,
Altahat, & Yousfi, 2020). Based on the results of data analysis, it can be seen that talent management
is able to increase organizational commitment or in other words, the higher the
talent management variable, the higher the organizational commitment.
The results of this
study support research conducted by Pramarta and Netra (2018), Arocas and Lara
(2020), Arocas et al. (2020); which
shows that talent management has a positive and significant influence on
organizational commitment. The implementation of talent management by Bank
Jatim Kepanjen Branch plays an important role in increasing the organizational
commitment of its employees. The results of data analysis in this study show
that in general, Bank Jatim Kepanjen Branch employees have a high emotional
attachment to the company. Through various policies provided by the company,
such as the existence of employee competency development programs, it is
considered able to increase the sense of employee involvement with the company.
The
Effect of Perceived Organizational
Support on Organizational Commitment�
The study found that perceived organizational support (POS)
has a significant influence on organizational commitment. Based on the results
of data analysis, it can be seen that POS is able to increase organizational
commitment or in other words, the higher the POS variable, the higher the organizational
commitment.
The results of this
study support the research conducted by Kurtesis
et al. (2015), Kalidas and Bahron (2015), Putri et al. (2018); which shows that POS has a positive and significant
influence on organizational commitment. The support provided by Bank Jatim
Kepanjen Branch plays an important role in increasing the organizational
commitment of its employees. Companies uphold equality in work is a form of
concern for employees, this can be seen through the results of data analysis
where the number of male and female employees has no gap. The company's support
felt by employees can increase their sense of involvement with the company.
The mediating effect of organizational commitment
on the effect of talent management on employee retention
Increasing
talent management can improve employee retention through organizational
commitment. This research shows that talent management has a positive and
significant effect on employee retention through organizational commitment.
Based on the results of statistical testing, it is stated that talent
management has a positive and significant effect on employee retention through
full mediation of organizational commitment, meaning that changes in the value
of organizational commitment can mediate the influence between talent
management on employee retention.
The mediating effect of organizational commitment
on the effect of perceived organizational support on employee retention.
Increasing
talent management can improve employee retention through organizational
commitment. This research shows that talent management has a positive and
significant effect on employee retention through organizational commitment.
Based on the results of statistical testing, it is stated that talent
management has a positive and significant effect on employee retention through
full mediation of organizational commitment, meaning that changes in the value
of organizational commitment can mediate the influence between talent
management on employee retention.
Research Implications
The results of this
study provide a new understanding of the theory of efforts in minimizing the
turnover intention of health workers. The implications of this research consist
of practical and theoretical implications.
Theoretical Implications
The hypotheses proposed
in this study exert different influences on talent management and perceived organizational support (POS).
Talent management in this research model does not have a significant direct
effect on employee retention(Narayanan,
Rajithakumar, & Menon, 2019). Meanwhile, POS has a positive and significant influence on employee
retention. In addition, the results of this study also show that Organizational
Commitment can be used as a full mediation for the effect of talent management
on employee retention, and as a partial mediation for the effect of POS on
employee retention.
Practical Implications
This research
contributes practically to human resource practitioners, which can be used to
find out what factors must be maintained, improved, and improved related to
talent management variables, perceived
organizational support, and organizational commitment in increasing
employee retention. The result of this study that can be implied at Bank Jatim
Kepanjen Branch is that efforts to increase employee retention can be achieved
by paying attention to appropriate talent management practices, providing
support to employees, and paying attention to strategies to increase employee
organizational commitment.
Research Limitations
Each study has its own
limitations that make the research less than perfect. The limitations in the
study include:
1.
The possibility of
respondents' answers being biased, so that the results of the answers may not
be objective.
2.
The sample was
relatively small because the questionnaire returned to the researcher consisted
of only 118 respondents.
This research was only
conducted at Bank Jatim Kepanjen Branch. So that the results of this study
cannot be generalized to other types of banks.
CONCLUSION
��������������� Based on the results of research
and discussion on the influence of talent management and perceived
organizational support on employee retention through organizational commitment.
So that the following conclusions can be given: (1) Talent management does not have a significant effect on
employee retention. This illustrates that high talent management is not able to
significantly increase employee retention. (2) Perceived
organizational support has a positive and significant effect on employee
retention. This illustrates that increasing perceived organizational support
can increase employee retention. (3) Organizational
commitment has a positive and significant effect on employee retention. This
illustrates that increasing organizational commitment can increase employee
retention.
(4) Talent management has a positive and significant effect
on organizational commitment. This illustrates that with the improvement of
talent management can increase organizational commitment. (5) Perceived
organizational support has a positive and significant effect on organizational
commitment. This illustrates that increasing perceived organizational support
can increase organizational commitment. (6) Organizational
commitment mediates the influence between talent management and employee
retention. This illustrates that higher organizational commitment is able to
mediate talent management which ultimately affects employee retention. (7) Organizational
commitment mediates the influence of perceived organizational support on
employee retention. This illustrates that higher organizational commitment is
able to mediate perceived organizational support which ultimately affects
employee retention.
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