Exclusive Talent Management, Perceived Organisational Justice & Employee Engagement

Exclusive Talent Management, Perceived Organisational Justice & Employee Engagement:

Bridging the Literature

By Mr. Edward P. O’Connor,

Maynooth University School of Business, Maynooth, Ireland.

Email:

Dr. Marian Crowley-Henry,

School of Business, Maynooth University School of Business, Maynooth, Ireland.

Stream 4 - Working Paper

Abstract

Purpose - This conceptual paper exploresthe relationship between an organisation’s exclusive talent management (TM) practices, the effects this has on its employees’ perceptions of organisational justice, and the implications for employee engagement. The paper develops a conceptual framework from a detailed review of the literature, where exclusive talent management, organisational justice and employee engagement overlap.

Design/methodology/approach – This conceptual paper is based on a review of the academic literature at the intersection of exclusive TM, organisational justice and employee engagement.

Findings – From the extant research, we postulate that in organisations pursuing exclusive TM programmes the different components of organisational justice, such as procedural and distributive justice (Gelens et al., 2013), together with perceptions on exclusive TM practices, impact upon employee engagement (Purang, 2011). This in turn affects organisational outcomes such as performance and retention (Gelens et al., 2014, Wooten and Cobb, 1999).

Originality/value – From our analysis, we construct and present a model depicting the relationship between exclusive TM practices and employee engagement. The propositions in the model are each supported by the respective literature. In unpacking how exclusive TM practices can impact on employee engagement, the paper is relevant for academics in this domain by bridging the literatures on TM, organisational justice and employee engagement. The research is also relevant for organisations to understand in terms of the antecedents and consequences of employee engagement which may be under the organisation’s control.

Keywords – Talent management, Employee Engagement, Organizational Justice, Procedural Justice, Distributive Justice

Introduction

This conceptual paper presents the findings from a review of the literature on the justice of exclusive talent management (TM) practices, and the implications this has for employee engagement in the workplace.

The research concentrates on two questions;

1. How does exclusive TM practices by organisations impact on employees’ perceived organisational justice?
2. What are the implications of question 1. on employee engagement in the workplace?

TM and employee engagement are currently two popular topics in management studies and both have captured the interest of practitioners and academics alike (Hughes and Rog, 2008, Saks and Gruman, 2014). Much of what has been written about both concepts comes from the practitioner and consultant literature(Saks, 2006, Lewis and Heckman, 2006). The third concept, organisational justice, is a popular medium with which to understand employee reactions to organisational practices (Gelens et al., 2013, Gelens et al., 2014, Malik and Singh, 2014), such as TM.

The links between the concepts are mostly examined under social exchange theory (SET)(Biswas et al., 2013, Gelens et al., 2013, Mirvis, 2012, Saks, 2006, Ghosh et al., 2014), which is a “well-established theoretical framework” (Ghosh et al., 2014, p.634). Social exchange theory involves a series of interactions that generate obligations, with these interactions usually seen as interdependent and contingent on the actions of another person (Emerson, 1976). These interactions, over time, can develop into high quality, committed and trusting relationships, once all parties involved abide by the ‘rules’ of the exchange (Cropanzano and Mitchell, 2005).

The paper is structured as follows: Firstit summarises the review process used and then provides a summary of the review findings. It then builds up our postulation on the linkage between the concepts on the basis of past research and extant literature. The paper concludes with the study’s limitations and the scope for further research in the domains of TM, organizational justice and employee engagement.

The Literature Review Process

The aim of a literature review is “to enable the researcher both to map and to assess the existing intellectual territory, and to specify a research question to develop the existing body of knowledge” (Tranfield et al., 2003, p.208). The paper reviews the literature at the intersection of exclusive talent management, organisational justice and employee engagement.

The rationale behind this paper is to review the existing literature on organisational justice, exclusive TM and employee engagement and, using past research, develop the linkage between the concepts in order to answer our research questions and provide direction for future research. A systematic literature review (SLR)was conducted, as per the sequence of steps as devised by Tranfield et al. (2003) and Pittaway et al. (2004) (The SLR process is detailed in appendix 1). A final total of 72 papers were reviewed..

Talent Management

Talent management is one of the most debated practices in the HRM field (Thunnissen et al., 2013), and is an area that lacks theory and distinct academic boundaries (Lewis and Heckman, 2006). Iles et al. (2010), ina review of the literatures’ conceptualisation of talent and TM, list four main perspectives on TM:

1. Exclusive-people view where an employee’s added value to the organisation is used as a form of workforce differentiation
2. Exclusive-position view focuses on differentiating employees according to the importance of their organisational role or position.
3. Inclusive-people view operates on the belief that all employees are talented in one form or another, with the potential to add value to the organisation.
4. Social capital perspective, which regards the work context and culture as an important part of TM.

There are also a number of disputed areas, or tensions in the literature (Dries, 2013). In this paper, the inclusive/exclusive tension is under scrutiny. Inclusive TM argues that everyone in the organisation has talent, and “the organization's task is to provide equal opportunities so all employees can reach their potential” (Malik and Singh, 2014, p.3). This follows the general HRM principle that all employees’ performances are to be managed.

Conversely exclusive TM regards some workers as more talented than others, and thus more valuable (Dries, 2013). This is the more practiced form of TM in organisations today, mainly due to perceived cost effectiveness and efficiency (Gelens et al., 2013) and as such is the form of TM that this paper is concerned with.

While the exclusive form of TM has been advocated by some(Iles et al., 2010, Gallardo-Gallardo et al., 2013), there are also more negative criticisms of the practice. The effects of categorizing a small percentage of the workforce “as having special powers” (Swailes, 2013a, p.37) is seen as raising ethical questions and being problematic, and employees who perceive organizational practices as unfair are likely to be dissatisfied(Wan et al., 2012).

A limited number of studies have concentrated on the impact of TM practices, mainly taking a meso perspective on organisational effects. This is despite TM practices also having effects at the micro level, such as affecting employee attitudes and behaviours (Gelens et al., 2014). However, Swailes (2013a) argues that not all employees are troubled over exclusive TM, with many unconcerned whether or not they are selected for talent programmes. This paper concentrates on those that are concerned with their selection (or not) for TM programmes and considers how these employees’ perceptions of organizational justice toward them (in being talented or not) impacts on their workplace engagement. This is important as “effective TM practices demonstrate commitment to human capital, resulting in more engaged employees” (Bhatnagar, 2007, p.645), with more engaged employees leading to positive organisational outcomes.

Employee Engagement

Saks (2006) observes that multiple definitions of employee engagement exist and there is a general lack of consensus in the literature on what employee engagement actually means (Shuck, 2011). However,Saks and Gruman (2014) find there are two influential definitions of engagement in the academic literature, from Kahn (1990) and Maslach et al. (2001).

Kahn (1990) defines ‘personal engagement’ as “the harnessing of organization members’ selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances” (Kahn, 1990, p.694), and describes engagement as the “simultaneous employment and expression of a person’s ‘preferred self’ in task behaviours that promote connections to work and to others, personal presence (physical, cognitive, and emotional), and active, full role performance” (Kahn, 1990, p.700). Kahn (1990) contends that three psychological states are needed for this engagement to happen; meaningfulness, safety and availability. Meaningfulness is a “feeling that one is receiving a return on investments of one's self in a currency of physical, cognitive, or emotional energy” (Kahn, 1990, p.704). Employees experience meaningfulness when they feel worthwhile, useful, appreciated and not taken for granted (Kahn, 1990). Safety is when employees can employ ones “self without fear or negative consequences”, (Kahn, 1990, p.708),and feel the organisation is supportive and trusting. Availability concerns how ready employees are to engage and “place their selves fully into role performances”(Kahn, 1990, p.714). This availability depends on employees having the “physical, emotional or psychological resources”(Kahn, 1990, p.714)needed to cope with both work and non-work aspects of their lives. Kahn suggests these three psychological states have a significant impact on employees’ physical, emotional and cognitive engagement. Studies have since shown that all three states were important constructs in creating an engaged workforce (Harter et al., 2002, Shuck, 2011).

In the second definition by Maslach et al. (2001),in their paper on job burnout, they describe engagement as “an energetic state of involvement with personally fulfilling activities that enhance one’s sense of professional efficacy” (Maslach et al., 2001, p.498) and engagementis characterised by “energy, involvement, and efficacy”. Thisis the positive antithesis of job burnout and its three dimensions of exhaustion, cynicism, and inefficacy (Maslach et al., 2001).

These two influential definitions have since been amended or refined by various scholars. Rich et al. (2010), in one of the first modern studies to re-examine Kahn’s domains of engagement (Shuck, 2011) and drawing from Kahn (1990) and Ashforth and Humphrey (1995), state engagement is a more complete representation of the selfand that individuals are only engaged when they are investing their “hands, head, & heart” (Ashforth & Humphrey, 1995, p.110) in active, full work performance.

Schaufeli et al. (2002) define employee engagement as a state of mind that consists of three components: vigour, dedication, and absorption, whileRothbard (2001)highlights that it involves two critical components: attention and absorption.

There are four major approaches to employee engagement running through the literature: Kahn’s (1990) Need-Satisfying approach, Maslach et al (2001) burnout-antithesis, Harter et al (2002) satisfaction-engagement approach and Saks (2006) multidimensional approach. These are summarised below:

Author(S) & Approach / Contribution
Kahn (1990)
Need Satisfying Approach / First application and use of engagement theory in the workplace (Shuck, 2011).
Defined ‘personal engagement’ and ‘disengagement’
Early Theoretical Framework
Maslach et al.(2001)
Burnout Antithesis / Conceptualises engagement as the positive antithesis of job burnout and its three dimensions of exhaustion, cynicism, and inefficacy (Maslach et al., 2001).
Harter et al (2002) Satisfaction-Engagement / Much cited study, first to look at the effects of engagement at business unit level, suggesting a positive link between engagement and organisational outcomes.
Saks (2006) multidimensional approach / Multidimensional approach, hypothesised that employee engagement developed through social exchange model (Shuck, 2011). Differentiates separate types of engagement, finding “ a meaningful difference between job and organizational engagement” (Saks, 2006, p.600).

These approaches form whatShuck (2011) describes as “the scaffolding for the current academic frameworks of employee engagement” (Shuck, 2011, p.316) and all four reach the conclusion that “employee engagement inside organisations has the potential to significantly impact important organisational outcomes” (Shuck, 2011, p.317).

The review revealed a strong relationship between employee engagement and positive outcomes at both the meso (organizational) and micro (employee) levels. At the meso level, employee engagement is seen as a key factor in areas such as organisational success (Rich et al., 2010, Bhuvanaiah and Raya, 2014), higher shareholder return(Richman, 2006) and improved customer satisfaction(Harter et al., 2002, Richman, 2006). Meanwhile micro level studies demonstrat a positive relationship with organisational loyalty (Mehta and Mehta, 2013), employee wellbeing (Shuck and Reio, 2014), turnover intentions (Shuck et al., 2014) and increased employee belief in CSR policies (Godkin, 2014).Overall the review presented employee engagement as positive for organisations and individuals in ensuring performance and in contributing to the organisation’s competitiveness.

Organisational Justice

Perceived organisational justice is defined as an employee’s “subjective perception of fairness of allocation” (Gelens et al., 2013, p.343) and is directly related to the quality of the employee-organizational relationship (Purang, 2011). Wooten and Cobb (1999) propound that justice plays a particularly important role in career development, especially in areas concerning the perceived fairness of organisational decisions affecting employees or their colleagues. The concept isconsidered a suitable medium to examine and understand employees’ reactions to exclusive TM (Gelens et al., 2013, Gelens et al., 2014, Malik and Singh, 2014), while other authors establish a link between employee engagement and organisational justice (Badewi, 2013, Ghosh et al., 2014, Mirvis, 2012, Saks, 2006).

There are three main forms of organisational justice: distributive justice, “the fairness of outcomes distributions and allocations”(Thunnissen et al., 2013, p.332), procedural justice, the perceived justice and fairness of the allocation process (Gelens et al., 2014)and interactional justice, the quality of the interpersonal treatment people receive whilst procedures are implemented (Thunnissen et al., 2013, p.332).Colquitt (2001) found that interactional justice is made up of two separate forms of justice; interpersonal justice, how employees are treated by those in authority, with respect, dignity etc; and informational justice, how well employees are informed about procedures and processes that affect them.

An important finding for this research is how the various forms of justice moderate and mediate the effects of organisational practices (Gelens et al., 2014) and the consequence of the order effect of the different justice concepts (Van den Bos et al., 1997). Studies found both distributive and procedural justice were linked to employee engagement (Biswas et al., 2013), while in other studies distributive justice was found to have a greater effect at the micro level, e.g. job engagement (Ghosh et al., 2014). Perceptions of procedural justice have a greater effect at the meso level, such asorganisational engagement (Saks, 2006).

An employee’s reaction to perceived injustice may result in “poor work attitudes, higher incidents of interpersonal conflict and low job performance” (Mahajan and Benson, 2013, p.723), and “low perceptions of fairness are likely to cause employees to withdraw and disengage” (Ghosh et al., 2014, p.634), which is what we posit can happen with employees not identified as high potentials in an organisation with exclusive TM practices.

Linking TM, organizational justice and employee engagement

For some employees exclusive TM practices have a negative effect on perceived organisational justice (as contended by Gelens et al. (2014), Lacey and Groves (2014), Malik and Singh (2014), Marescaux et al. (2013) among others) and, as perceived organisational justice is an important element in employee engagement (as contended by Agarwal (2014), Biswas et al. (2013), Ghosh et al. (2014), He et al. (2014), Li (2012), Saks (2006) and others) we positthat exclusive TM may have a negative relationship with employee engagement, through amediating role played by organisational justice.

We posit that

P1. Employees labelled as talented, will experience higher levels of engagement. Employees labelled as talented were found to be positively disposed to theirrecognition as being“talent”(Huselid and Becker, 2011), dedicated with lower turnover intentions (Björkman et al., 2013) and have higher perceptions of justice (Gelens et al., 2014).We contend that, asthese have been recognised as antecedents to engagement(Saks, 2006), that exclusive TM can affect employee engagement.

P2. Employees not labelled as talented may reciprocate with counterproductive attitudes and behaviours, which is active disengagement. Marescaux et al. (2013) find workforce differentiation, the core of exclusive TM, leads to negative effects, with lower affective commitment. Employees’ reaction to perceived injustice or inequality has been found to result in “poor work attitudes, higher incidents of interpersonal conflict and low job performance” (Mahajan and Benson, 2013, p.723), and that “low perceptions of fairness are likely to cause employees to withdraw and disengage” (Ghosh et al., 2014, p.634).

P3. SET does not happen in a straightforward way as every employee has their own perceptions of fairness, just effort and reward. We posit that organisational justice, in its distributive and procedural forms, will play a key role in how employees react to exclusive TM. Employees will evaluate the fairness of themselves being labelled, or not, as talented, and will compare their estimated output with their received resources and from this, if they perceive their contributions are/are not reciprocated by the organisation, will experience more favourable/less favourable perceptions of distributive or procedural justice.

P4. Perceptions of justice shape employee reactions (Cropanzano et al., 2007). Depending on the perceived justice the employee will shape their reaction accordingly. In SET, if the employee perceives an income/outcome imbalance, they will want to rebalance the relationship, as they want the exchange relationship to be what they perceive as fair. Thus lower outcomes, as with some not labelled as talented, will mean a lowering of work effort and commitment (Cohen-Charash and Spector, 2001). On the other hand, some labelled as talented will respond positively as exclusive TM positively affects their reactions (Gelens et al., 2014).

P5. Based on the moderating effects of interpersonal and informational justice, the effects of procedural and distributive justice may be buffered. We posit that when employees are provided with appropriate, clear information and fair treatment, and when they understand the whole process, their reaction to announced TM outcomes may be moderated. However an issue that inhibits this possible buffer to perceived injustice is the secrecy under which some organisations operate their TM systems (Lacey and Groves, 2014), which prohibits the provision of clear information and open procedures.

Discussion

Social scientists have long acknowledged that justice is vital in the effective running of an organisation and for the satisfaction and fulfilment of its employees (Greenburg, 1990). In this paper we have introduced a framework, constructed from a series of propositions, for researching how perceptions of organizational justice concerning exclusive TM can affect employee engagement.