talent management challenges in a knowledge economy: an

Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)

An Online International Research Journal (ISSN: 2306-367X)

2018 Vol: 7 Issue: 1

2418 www.globalbizresearch.org

Talent Management Challenges in a Knowledge

Based –Economy: An analytical Study of Saudi Banks

Alharbi, S. Hamed, Tabuk University, Kingdom of Saudi Arabia.

E-mail: [email protected]

Morsi, N. Mohamed,

Tabuk University, Kingdom of Saudi Arabia. E-mail: [email protected]

___________________________________________________________________________________

Abstract

The Saudi economy is heading towards a knowledge economy. Therefore, the current study

focuses on determining the challenges facing the application, and human resources

management functions of talent in a knowledge-based economy. Accordingly, the current

study focuses on the employees' perceptions of the challenges and obstacles facing and

impeding the implementation of talent management if Saudi banks. Also, the study focuses on

the practical recommendations to cope with such challenges and overcome them in order to

enhance economic and social development. The main objective of the present study is to test

three hypotheses developed from the review and analysis of relevant literature. Examining

data from twelve Saudi banks and 140 employee and manager, show significant differences in

the challenges of talent management across Saudi banks. The current study also shows that

talent management challenges are classified into bank level challenges and industry or sector

level challenges.

___________________________________________________________________________

Key Words: Knowledge Based –Economy, Talent, Talent management, Talent challenges and

obstacles

JEL Classification: M120

mailto:[email protected]

mailto:[email protected]





1. Introduction

Studies on Talent Management (TM) have been conducted extensively in developed

countries (e.g. McDonnell, et.al. 2015, Collings, et.al. 2009, Capelli, 2008, Cooke, et al.

2014) where their findings have contributed to the body of TM literature. On the other hand,

scant research has been conducted in different context, especially in the Middle East and

particularly in Kingdom of Saudi Arabia (KSA), where it has its own factor that challenge the

implication of TM. This research comes to shed the light on the factors and issues that face

TM. The rapid changes in economic and social changes in Saudi market make it difficult to

understand the exact challenges. The Saudi economy is transferring into knowledge-based

economy (Transition Report to Knowledge Society in Saudi Arabia, 2014). Human resources

are an important pillar of the knowledge economy. This type of economy depends on the

element of knowledge and intellectual capital in achieving economic and social development.

It is clear that the foundation of knowledge economy is the educated and skilled human

resources (talents and competencies) on which this economy depends in the creation, sharing

and use of knowledge.

2. Talent, Talent Management and Talent Challenges

At the beginning we would start to articulate the meaning and definition of Talent

management (TM), which in turn allows to identify its challenges. When reviewing the

literature to search for definition of TM, many definitions came up, as it seems that the

definition itself is still controversial and there is no agreement among academics about one

clear meaning, which presents the first challenge of TM. That is because the definition will

lead to present the challenges. Some writer describe it as the practice of the traditional

functions of HR, while others go to describes TM as a newer faction of Human Resource

Management (HRM), where supporters of this perspective argue that all employees have

talent, and that organizations should use a good practice of HRM functions to utilize these

talent. This has been criticized for being undifferentiated and described as 'old wine in a new

bottle' (Lewis & Heckman, 2006).

Furthermore, Lewis & Heckman indicated it is still difficult to find a solid definition

because the phrase itself surrounded by many assumptions. Another perspective treated TM

as succession planning to ensure the continuality in the line of talented leaders. Other

approach perceives TM as the management of talented employees, which means focusing on

a few number of employees who demonstrate high potential or performance. From this

perspective, organizations have a certain criteria that has been used to identifying those who

are talented, then mange them through a set of HRM tools. Another approach to TM is that

referring to Human Resources Capital where recruiting, assessing, developing and

maintaining employees is an organizational goal (Capelli, 2008, Nair, 2009).





Therefore, Mellahi, & Collings (2009) conclude in their review that the lack of precise

definition of TM contributes to the limitation of understanding TM which, in turn, influences

the definition of what are the TM practices and challenges. Talent can be divided in two parts,

one part goes to the managers who are willing to motivate and detect the talent of their

employees, while the second belongs to the employees themselves who would like to improve

their skills and to be dedicated at work. In addition, the organizational culture has a

contribution to employees for being talented. AlRuwaili (2013, p.9) notes that "while talented

people are those who have the energy and willingness to accept challenges, they also show

their abilities in creating distinctive features for the organization". Bhatnagar (2012)

indicates that TM is facing many issues and challenges around the globe, and that these

challenges can be sometimes overtaken, when managers' experience play crucial part to deal

with these challenges.

We believe that challenges of talent management differ from one region to another; from

one context to another; from one culture to another; and from one economic system to

another. That's because the situation is different, the circumstance are different, and vies

versa. This means that challenges of TM can be affected by the surrounded context, meaning

that social and cultural setting contributes to the challenges of TM. This implies that TM

challenges in developed countries differ from challenges at developing countries.

Consequently, the practice of TM has a considerable contribution in overcoming TM

challenges such as treating the staff in fair manner (Alamri, 2016). Furthermore, Egerova

(2013) indicates that the increased complexity and structural shifts of the economy and

workplace create significant talent management challenges.

The organization's strategies are also important in maintaining and retaining talented

employees (Koketso & Rust, 2012). They conclude that organizations that face such kind of

challenges of keeping employees must devise a strategy that ensures the retention of their

talented employees. Nair & Vidyeswari (2009) note that the success of organizations and

businesses depends significantly on successful TM. Accordingly, when organizations face

difficulties in finding, keeping, retaining, motivating and developing employees, HR

professional should keep focus on the following six points (Nair & Vidyeswari, 2009):

1. Attracting candidate who possess high quality of standard

2. Identifying and develop employees who achieve high performance

3. Retain employees who are valuable to the organization and top performers

4. Filling high-impact positions to support their company's growth

5. Keeping employees engaged and focused on high priority goals

6. Optimizing compensation to serve business objectives





Beechler & Woodward (2009, p. 257) state that there are four significant factors that

affect the war of talent, these are: global demographic and economic trends; increasing

mobility of people and organizations; transformational changes to business environment skills

and culture; and finally growing levels of workforce diversity. They also indicate that each

organization faced their own unique challenges.

3. Literature Review

The current study focuses on the challenges and constraints facing the application of TM

in Saudi banks. According to the comprehensive body of studies on the broad subject,

especially the empirical ones, the authors have summarized these studies in (Table 1).

Previous studies on TM challenges have been conducted in several countries such as South

Africa, Poland, Slovenia, UK, China & India, Kenya, Saudi Arabia, Lebanon and Iran. These

studies have shown many different challenges in several areas. In South Africa, the study of

Koketso & Rust (2013) identified the challenges as the failure to retain talent, lack of

recognition of staff, problems of succession planning and management, and poor career

strategy. In the study of Poland (Skuza & McDonnell, 2013), the challenges were: selecting

individuals in the light of personal considerations, less interaction with higher management,

less acceptance of individual success, reliance on interpersonal relationships, less training

value, less acceptability, evaluation, lower participation in decision-making, lack of

performance management standards, and employee-biased evaluation. According to Cooke &

Wang (2014) comparative study of India and China, differences were found in the meaning

and TM systems between the two countries. This study examined the challenges under three

levels: the first is the individual level (such as the opportunistic behavior of talented

employees), the organizational level (e.g, short-term behavior of talent acquisition rather than

development) and finally the overall level. The study found that the problem of TM in both

countries is attributed to the shortcomings of the education system.

The Kenya study (Orwa and Njeri, 2014) have focused on the main challenge of TM in

the form of organizational culture, and other challenges such as career management, incentive

system, and work environment. In Alamri (2015 & 2016) studies applied to KSA in two types

of public and private organizations, the challenges were divided into challenges that apply to

both public and private organizations, challenges to public organizations and challenges to

private organizations only. In their study applied to Lebanese organizations, Hejas, et.al.

(2016) outlined strategies and practices for TM and challenges. In another study, applied to

the Iranian automobile industry, Tafti & Amiri (2017) show that there are four divisions of

challenges and obstacles, structural, environmental, behavioral, and managerial.





Table 1: Previous Empirical Studies Addressing Talent Management Challenges (Source: The authors)

Results Sample Objective Country Author No.

Talent management challenges are: failure to retain key talent,

lack of employee recognition, succession planning and

management problems, poor career management strategies

20 senior managers in

Cape Town, South

Africa

To explore the perceptions of

senior management managers on

the challenges of talent

management in government

agencies

South Africa Koketso & Rust,

2012 1

1-There are significant differences in the intensity of the

challenges between domestic and foreign companies, and there

are differences according to the administrative level of

managers.

2-The main challenges are selection of individuals in the light

of personal considerations, less interaction with senior

management, less acceptance of individual success, reliance

on interpersonal relationships, less value for training, less

acceptance, short-term focus on evaluation, less participation

in decision-making, lack of management standards and biased

appraisal.

6 focus groups, each

consisting of 12

participants, selecting

an appropriate sample

of 100 managers in

various training

programs and from

58 local and foreign

companies

To identify the initial challenges

and constraints to effective talent

management in Poland and

compare them with studies of

Western countries and between

local and multinational companies

Poland Skuza et al. 2013 2

The authors identified challenges related to TM in transitional

countries based on APC characteristics.

560 students (219

Slovenian, 220

Polish, and 91

British.

To identify challenges of talent

management based on

anticipatory psychological

contracts

Poland,

Slovenia, UK Zupan, et al. 2013 3

1- There is a difference in the meaning of talent management

among managers in India and China,

2- There is a difference in talent management systems where

managers in China focused on financial incentives,

3- The most important challenges at the individual level, the

opportunistic behavior of talented employees,

178 directors from

various Chinese and

Indian companies in

terms of ownership

and ownership

To discuss the concept of talent,

talent management, talent

management practices, and talent

management challenges facing

companies in China and India

China and

India Cooke et al. 2013 4





4-The key organizational issues are : Short-term behavior for

talent acquisition rather than development, weak leadership

and communication, unprofessional management behavior,

application of human resources management tools.

5- At the macro level, managers in both countries attributed

the problem of talent management to the inadequacy of the

education system in each country

The organizational culture is a major challenge to talent

management, as well as the impact of other career

management challenges, incentive system, and work

environment

A class sample

consisting of 61

respondents from

Radio Kenya from

159 countries

To look at how the culture of

organization, career management,

incentive system, and work

environment affect talent

management

Kenya Orwa & Njeri, 2014 5

There are three types of challenges found in public and private

, secondly in public organizations, thirdly in private

organizations

18 human resource

managers, 8 private

organizations , and 8

public organizations

To investigate talent management

challenges in public and private

organizations

Saudi Arabia Alamri, 2015 6

Public organizations need to improve its system and policies

regarding talented employee identification

18 human resource

managers in public

organizations

To investigate talented employee

identification in public

organization

Saudi Arabia Alamri, 2016 7

More details about which strategies and HR initiatives the

targeted professionals agreed on

30 organizations were

carefully selected and

filled by HR

professionals

To explore talent management

strategies and practices Lebanon

Hejase, et. al. 2016

, 8

A framework of obstacles and challenges in talent

management was classified into four categories that are

structural challenges, environmental , behavioral, and

managerial challenges

15 managers in

automotive industries

To identify the obstacles and

challenges of talent management

as well as its success factors

Iran Tafti & Amiri, 2017 9





Based on the review and analysis of previous literature, the present study is based on the

development of the necessary measures to measure the challenges and obstacles of talent

management in Saudi banks as service organizations, so that they are multi-faceted and do not

measure one aspect or dimension of the challenges and be true in measuring variables. These

metrics will begin to measure the clarity of the concept of talent management and senior

management culture in terms of talent management, organizational and environmental

constraints, and finally a range of constraints on HR systems applied to talent management.

4. Research Problem

There is increased global attention to the issue of TM and competencies as a stage of

development in the field of HRM. Talent is an important human resource for the competitive

advantage of businesses. Despite this interest, there is a paucity of empirical studies and an

abundance of theoretical writings on this subject particularly in the Arabic context. In view of

the KSA's broad orientation towards the knowledge economy, the current study of TM is an

important and critical focus of the knowledge economy in the Kingdom. This raises a number

of questions, and the current study attempts to find answers to them. Therefore, the problem

of research can be formulated in the following questions:

1. What are the challenges and obstacles facing the application of talent and

competency management in Saudi banks?

2. Do the challenges and obstacles facing the application of TM vary across Saudi

banks?

3. Are there statistical differences in the challenges of TM depending on the

personal, social and functional background?

5. Research Objectives

This research aims to explain the meaning of talent and talent management and their role

in contributing to the development of the knowledge economy in KSA. The second objective

is to determine the quality and level of challenges and constraints facing the application of

talent management in Saudi banks and knowledge of the interrelationship between them.

Finally, suggesting solutions and proposals to overcome these challenges in order to achieve

economic and social development in the Kingdom.

6. Hypotheses Development

In light of the review of the results of previous studies and the conclusions reached, the

current research hypotheses can be formulated as follows:

First Hypothesis (H1): Positive correlations with significant statistical significance are

expected between talent management challenges.





Second Hypothesis (H2): Significant differences in talent management challenges are

expected to occur in different banks.

The third hypothesis (H3): It is expected that there are significant statistical differences in

talent management challenges depending on the personal, social and functional variables of

study.

7. Research Methodology

This part of the study includes the composition of the research sample, data collection,

and measurement of the research variables.

7.1 Sample Composition and Data Collection:

The current study focused on the banking sector as one of the most important economic

sectors in KSA and the most influential in the knowledge economy adoption in the Kingdom.

Therefore, the current study applied to all 12 branches of Saudi banks operating in Tabuk

region. The list of banks included Al Rajhi, Bank, Al-Ahli Bank, Riyadh Bank, Saudi

Investment Bank, Albalad Bank, Arab National Bank , Al'iinma Bank, French Saudi Bank,

Hollandi Saudi Bank, British Saudi Bank (SABB), Samba, and Al-Jazira bank . As for the

sampling units, a random sample of the employees of these banks was selected. They were

estimated at 140 employees, administrators, managers and various levels of management to

identify their perceptions about the challenges of talent management in the banking sector

operating in KSA (Table 2).

Table 2: Respondents Sample Characteristics

%Percent Frequencies Sub-cluster Respondents

Characteristics

53% 75 20-30 years

1-Age

37.6% 53 31-40

7.1% 10 41-50

0.7% 1 51 and more

98.6% 139 Total

88.7% 125 Administrator

2-Job Title 10.6% 15 technical

0.7% 1 Others

100% 141 Total

6.4% 9 Top management

3-Current Job 24.8 35 Middle management

58.9 83 First supervisory level

86% 127 Total

42.6% 60 Less than 5 years

4-Experience

31.2% 44 More than 5-Less than 10 years

14.9% 21 More than 11-Less than 15 years

9.9% 14 More than 15 years

98.6% 139 Total

69.3% 97 Human Resources Mg.

5-Department

responsible for

human affairs

17.0% 24 Personnel Mg.

3.5% 5 Personnel Affairs Mg.

9.9% 14 Others

99.3% 140 Total





19.1% 27 Non 6-Attending

Training programs

19.1% 27 One program

15.6% 22 Two programs

46.1% 65 Three or more than 3

100% 141 Total

12.8% 18 Secondary school or Less

7-Educational level

39.7% 56 Diploma between secondary

school and University

47.5% 67 University graduates

100% 141 Total

A carefully constructed questionnaire, which was originally developed in Arabic, was a

research tool to collect data. The questionnaire consisted of two sets of information: the

personal data collection of the researcher and another group containing the challenges of

talent management.

7.2 Measurement of Variables

Despite the many definitions of TM in many writings, for the purposes of the current

research it can be defined as follows: "A range of functions and activities that include

attracting, selecting, training, planning career progression and maintaining the talented,

Outstanding Performance". A questionnaire was designed to measure talent management

challenges. The questionnaire included the following variables and elements. The final

questionnaire included 25 questions as follows: The first group of variables included 7 items

such as age, current job title, current job, duration of experience, name of department that

handles personnel and employees of the bank, number of training courses obtained in the field

of human resources, and finally the level of education. The second group of challenges

questions for TM and Competencies in Saudi Banks and this part of the questionnaire

included 18 questions to measure the following challenges on the five-point Likert scale:

(A) The clarity of the concept of TM

(B) The Bank's senior management commitment to the culture of TM.

(C) Organizational challenges.

(D) Environmental challenges.

(E) Challenges related to selection systems, incentives and training.

(F) Performance evaluation challenges.

8. Results

The results of the present study can be divided into three parts. The first deals with the

results of descriptive statistical analysis and the second deals with the results of the reliability

analysis and the validity of the measurements, while the third deals with hypotheses testing.

8.1 Descriptive Statistics Analysis:





Table (3) summarizes the results of descriptive statistical analysis of averages and

standard deviations of TM challenges applied to Saudi banks under study.

Table 3: Means and Std. Deviations of the Major Components and Questionnaire Items

Std.

Deviation

Mean Questionnaire items Major

components 0.999 3.158 F1 Descriptive Statistics: Factor 1:

Bank level

challenges 1.234 3.350 10. Selecting people based on

personal consideration

1.197 3.235 11. Top level personal biases

when doing talent performance

appraisal

1.192 3.128 12. Losing criteria and tools to

evaluate talent objectively

1.245 2.985 13. Direct communication

barriers to exchange

information among

1.213 3.157 14. Insufficient recognition and

talent acceptance and unfair

incentives bases

1.322 3.071 15. Senior managers feelings

that talents are threats

0.953 3.358 F2 Descriptive Statistics: Factor 2:

Banking

sector/industry

level challenges

1.194 3.275 18. In general, Talents limited

participation in decision

making

1.199 3.268 20. Saudi banks lack a new

culture to manage talent and

competencies

1.168 3.398 22. The lack of clarity of the

terms of talent and talent

management for practitioners

in the management of human

resources in Saudi banks

1.155 3.219 23. The scarcity of talent and

competencies of individuals in

senior management and

leadership positions in Saudi

banking activity

1.275 3.532 25. Increasing turnover

(leaving) work within Saudi

banks in general

The results of the factor analysis showed two factors of TM challenges in Saudi banks as

follows:

Factor 1: Challenges at the Bank Level, With A General Average of 3.16 of 5, Or 62.6%.

The Elements Of The Questions Were Descending As Follows:

Rank in descending order Score Elements of

questions

(1) 3.35 V10

(2) 3.23 V11

(3) 3.16 V14

(4) 3.13 V12

(5) 3.07 V15

(6) 2.98 V13

3.16 Average





Factor 2: Challenges at the Level of the Banking Sector, With a General Average of 3.36 of 5,

Or 67.2%. The Elements of The Questions Were Descending As Follows:

Rank in descending order Score Elements of

questions

(1) 3.53 V25

(2) 3.40 V22

(3) 3.27 V18

(4) 3.27 V20

(5) 3.22 V23

3.16 Average

Overall, the challenges for the banking sector as a whole (3.36) were higher than the

Bank's (3.16).

8.2 Reliability and Validity of Scales

The validity and reliability of the parameters used in the present study were analyzed

using the correlation coefficients between the elements of the scale used (Table 4), the Alpha

Cronbach analysis, the exploratory factor analysis (Table 5) and the Confirmatory factor

analysis (Tables no. 6, 7).

8.2.1 Correlations Matrix

The internal consistency of the elements of the study instrument has been verified and the

extent of the association of these elements of the constituent questions by finding correlation

coefficients using the Pearson correlation coefficient. Table 4 presents correlation coefficients

of eleven challenges items. The pairwise correlations were positive and significant at the 0.01

level in all items. Seven of questionnaire items were excluded for the non-significant

correlation coefficients. Table 4 indicates that H1, the first hypothesis of significant statistical

correlations between TM challenges in Saudi banks has been achieved.

Table 4: Correlations Matrix

V25 V23 V22 V20 V18 V15 V14 V13 V12 V11 V10

1 V10

1 0.69 V11

1 0.71 0.60 V12

1 0.66 0.61 0.49 V13

1 0.65 0.68 0.60 0.64 V14

1 0.44 0.49 0.47 0.50 0.39 V15

1 0.41 0.48 0.41 0.44 0.42 0.46 V18

1 0.64 0.43 0.48 0.48 0.53 0.48 0.34 V20

1 0.55 0.52 0.54 0.43 0.43 0.53 0.53 0.40 V22

1 0.65 0.63 0.49 0.44 0.47 0.54 0.59 0.54 0.44 V23

1 0.60 0.47 0.54 0.32 0.33 0.32 0.31 0.41 0.41 0.34 V25





** All Correlations are significant at the 0.01 level

8.2.2 Exploratory Factor Analysis (EFA)

EfA with varimax rotation was performed on TM challenges in order to extract the

dimensions of challenges construct for the full sample of respondents. Table 3 shows the

results of EFA for TM challenges. Table 5 indicates that the EFA on the full set of 11 TM

challenges yielded two factors with eigen- values greater than 1.

Table 5: EFA of TM Challenges

Cronbach's

alpha

Cumulative

%

% Variance

explained

Eigen-

value

Factor

loads

Factors

0.891 34.419 34.419 6.173 Factor 1: Bank level

challenges

0.798 Q10: Personal

matter's

selection

0.786 Q11:Performance

appraisal biases

0.777 Q12: Losing criteria

to evaluate talent

0.750 Q13: Direct

communication

barriers

0.813 Q14: Insufficient

recognition of talent

0.490 Q15: Talents are

threats

0.859 65.679 31.669 1.073 Factor 2: Banking industry level

challenges

0.636 Q18: limited

participation in

decision making

0.779 Q20: Lack of talent

mg. culture

0.733 Q22: Unclear talent

mgt.

0.758 Q23: The scarcity of

talent

0.776 Q25: Increasing

turnover

Based on the item loading, these two factors were respectively labeled as bank level

challenges (BLC), and banking sector/ industry level challenges (BIC), which explained

65.67 per cent of the observed variance. The Cronbach alpha values of reliability for

underling factors are 0.891, and 0.859 respectively, suggesting satisfactory level of construct

reliability which is greater than 0.7.

8.2.3 Confirmatory Factor Analysis (CFA)

This step is also known as testing the measurement model where the construct of TM

challenges was tested using the first order confirmatory factor model to assess construct

validity using the method of maximum likelihood. The results consistently supported the

factor structure for challenges structure as discussed earlier in the EFA step. The confirmatory





factor diagram using Amos is shown at figure 1. The CFA technique is based on the

comparison of variance –covariance matrix obtained from the sample to the one obtained

from the model. The measurement model results at the aggregate level for TM challenges are

presented in Table 6. The figures in table 6 exhibit the standardized regression weight

between each manifest variable and its corresponding latent variable. All the observed

variables have a standardized loading of more than 0.5 attesting the convergent validity of the

measure. The goodness of fit statistics for TM challenges is shown in Table 7. The resulting

measurement models and their respective observed variables for challenges construct indicate

an acceptable fit. The values of CFI, IFI, NFI, RFI, and TLI are highly satisfactory, as they

are very close to a value of 1.0, which denotes a perfect fit. In addition, the values of x2/df

ratio should be within the range of 0-5 where lower values indicating a better fit.

Fig.1: The Confirmatory Factor Path Diagram

Table 6: CFA of TM Challenges

Standardized regression weights Factors and items

Factor 1: Bank level challenges

0.741 PM : Personal matter's selection

0.830 PA : Performance appraisal biases

0.854 LC : Losing criteria to evaluate talent

0.762 DC : Direct communication barriers

0.793 IR : Insufficient recognition of talent

0.599 TT : Talents are threats

Factor 2: Banking sector/ industry level challenges

0.671 LP : limited participation in decision

making

0.784 LT : Lack of talent mg. culture

0.755 UT : Unclear talent mgt.

0.837 ST : The scarcity of talent

TM

Challenges

Construct

DC

PM

IR

LP

LT

UT

F1

Bank level

challenges

F2

Industry

level

TT

IT

PA

LC

ST





0.645 IT : Increasing turnover

Table 7: Goodness of Fit Statistic

𝐂𝐡𝐢 𝐬𝐪𝐮𝐚𝐫𝐞

/df

df 𝐂𝐡𝐢 𝐬𝐪𝐮𝐚𝐫𝐞 RMSEA TLI RFI NFI IFI CFI

1.970 43 84.725 0.08 0.924 0.857 0.907 0.952 0.951

8.3 Variance Hypothesis Testing

To test hypothesis, H2, H3, ANOVA analysis was used and it showed that:

(1) There are significant differences in the challenges of TM across the studied

banks, 11 of them with a level of 0.002 for the first factor, 0.005 for the second

factor of the challenges.

(2) There are significant differences in the challenges of TM according to the

current function of the respondents (top management, middle administration, first

supervisory level), with a significant level of 0.011, and zero.

9. Discussion and Conclusion

This study examines the challenges facing the application of TM among commercial

banks in KSA. The study showed two main types of factors that represent the challenges and

obstacles facing banks in applying TM. The first type of challenges and obstacles are internal

elements of the bank. The second type is external elements related to the nature of the

banking industry or the banking sector itself. The first type elements are insufficient

recognition of talents, choice according to personal considerations, biases in performance

assessment, lack of objective criteria for talent assessment, communication impediments. On

the other hand, there are factors related to the nature of the service sector itself, the most

important of which is the increase in the turnover rate, the weakness of TM culture, the

scarcity of talents, and the ambiguity of talent management itself.

As for the study hypotheses, differences were found in the challenges and obstacles of

TM with significant statistical significance across the studied banks. There were also

significant differences in TM challenges of significant statistical significance according to the

current job of the respondents.

9.1 Implications for Practice

The present study has been applied to an important service sector in KSA, the banking

sector, which is facing stiff competition for talents and competencies and rapid technological

and knowledge transformations. Talent or human capital is one of the most important factors

of its success and progress. The challenges facing talent management in Saudi society are

somewhat different from those in Western and European societies. In other words,

community cultures and organizational culture play a major role in shaping the practices and





challenges of TM in developing societies, as well as in developed societies. To explain this,

Saudi society is traditional and conservative and traditional practices are applied to HRM. TM

is something new and requires changing the culture of banks related to traditional HRM

practices and switching to TM practices.

9.2 Limitations and Further Research

The present study was conducted only on Saudi banks operating in Tabuk region, which

may require further studies in other parts of KSA. The study makes a valuable contribution to

research in the knowledge based Saudi Economy, specifically the banking sector. This

research focused only TM challenges. Further studies also are needed to investigate the TM

practices and benefits in the same banking sector.

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