Talent management in medium-sized German companies: an explorative study and agenda for future research

Abstract This study seeks to make a contribution to our conceptual and empirical understanding into the nature of talent management (TM) in German small and medium-sized enterprises (SMEs), an under-researched area in the field. The approach of this investigation recognizes that TM may vary significantly between different types of companies and national contexts. The findings are based on data collected from 700 SMEs in Germany. Three distinct clusters of TM intensity profiles are identified (highly engaged talent managers, reactive talent managers and retention-based talent managers), which vary according to annual sales volumes, industry affiliations, cooperative behavior with respect to human resource (HR) and TM networks, the long-term focus of TM and future HR and TM budgets. In summary, most of the investigated companies place a high importance on TM reflecting a developmental approach which fits well with the German business system. One key finding of the study was the preference of most German SMEs to choose a more inclusive approach to TM and target all or most employees, in contrast to large multinational enterprises where a more elitist approach is favored. Another major finding was that TM cooperation with other firms and institutions was used as a strategy to cope with the war for talent in a country, which despite the Global Financial Crisis is characterized by strong economic growth and important demographic challenges. Based on these findings and the contextual approach to TM, a comprehensive agenda for future research areas in TM is outlined. Keywords: GermanyGerman national business systemhuman resource managementinstitutional theorysmall and medium-sized companiestalent management