The interplay between employee development factors and succession planning in predicting employee performance: evidence from retail banks

Abstract

PurposeThe purpose of this study is to examine how employee development factors directly influence succession planning and indirectly improve employee performance using the tenets of human capital theory. Moreover, whether succession planning enhances employee performance or not?Design/methodology/approachUsing the time-lag method, this study collected data from bank employees and tested the proposed model and hypotheses in Mplus.FindingsThe results from 239 participants highlight that succession planning improves bank employee performance. Employee orientation and training and development are positively linked to succession planning and employee performance. Succession planning mediates the association between employee development factors and employee performance.Practical implicationsThe research assists bank management to promote a learning culture for developing their human resources to realize their organizational goals. The findings exhibit that succession planning generates a pool of skilled and talented employees, which creates a competitive edge for banks having skilled employees and reduces recruitment costs. Banks to save human recruitment costs. Moreover, bank managers can solve the issue of sudden vacant positions and provide excellent customer service.Originality/valueRetaining talented individuals has remained a challenging task for organizations in the current business environment. The research contributes to theoretically and empirically exploring the association between employee development factors (training and development and employee orientation) and employee performance via succession planning to retain talented employees in the organization.