Influence of Human Resource Capability in Relating Talent Management Strategy and Competitive Advantage

Abstract

Organisations aim at providing best quality at the lowest cost. It is beneficial to identify values and work preferences generation Y in order to employ, develop, retain and prepare them for future leadership. Talent Management strategies that enhance retention of the required talents enables the organisation gain a competitive advantage. The study sought to understand if leveraging on Generation Y’s talents puts the organisation in a better competitive position. The research objective was to determine whether introduction of the mediating variable of human resource capability had any effect on the relationship between talent management strategies for generation Y and the commercial bank’s competitive advantage. The target population of the study comprised of 43 Commercial Banks in Kenya and the given unit of observation was 6 departments in each bank namely: human resources, finance, marketing, credit, treasury and Audit. The findings of the study revealed that Talent Management Strategies alone contributed a fairly good extent to competitive advantage of banks at 55.3% (Ṝ2=.553). An inclusion of a mediating variable, HR Capability presented a percentage level of 39.8% (Ṝ2=.398). Further tested whether the mediating variable had any effect on the relationship between the independent variables and the dependent variable. Multiple regression models were used to predict the relationship which proved to be true with a positive percentage of 55.8% (Ṝ2=0.558), an increase in the value of Ṝ2 by 0.005. This indicates that the mediating variable has a statistically significant effect on the relationship between talent management strategies and the competitive advantage, hence concluding that HR Capability derived from application of talent management strategies has a partial mediating effect on the relationship between talent management strategies for generation Y and competitive advantage of commercial banks in Kenya. Thus, the study notes that the strength of the relationship between talent management strategies for generation Y depends on the level of HR Capability arising from the strategies.