BRIDGING TALENT MANAGEMENT AND POPULIST LEADERSHIP: A TRANSFORMATIONAL MINDSET MODEL FOR EMPLOYEE RETENTION IN DEVELOPING REGIONS

Abstract

Purpose – This study aims to bridge two seemingly contradictory leadership paradigms—talent management (merit-based) and populist leadership (accessibility-based)—into an integrated transformational mindset model for enhancing employee retention in developing regions. Drawing on data from local government in Indonesia, the research addresses a critical gap: how can public sector leaders simultaneously develop high-potential employees while remaining accessible and responsive to all staff? Methodology – A sequential explanatory mixed-method design was employed. Quantitative data were collected from 442 civil servants across 25 regional work units in DKI Jakarta, Indonesia (January–April 2026). Structural equation modeling (PLS-SEM) was used to test the hypothesized relationships. Qualitative data were gathered through semi-structured interviews with 12 senior HR officials and agency heads to triangulate findings. Findings – The results reveal that a talent-based transformational mindset significantly enhances modern HRM practices (β = 0.58, p < 0.001) and psychological ownership (β = 0.47, p < 0.01). Populist-oriented leadership directly strengthens employee–organization value congruence (β = 0.53, p < 0.001) and indirectly improves retention through trust in leadership (β_indirect = 0.38, p < 0.001). The interaction effect between talent-based mindset and populist mindset on retention was significant (β = 0.16, p < 0.01), indicating complementarity rather than substitution. Notably, retention was highest (mean = 5.94) when employees perceived their leaders as high on both dimensions. Originality/Value – This study makes three original contributions to rural development and entrepreneurship literature. First, it reconciles the false dilemma between merit-based talent systems and accessible, people-centered leadership—a critical insight for developing regions where both institutional capacity and social trust are limited. Second, it provides a validated measurement model that can be replicated in other developing region contexts. Third, it offers actionable policy recommendations for local governments seeking to retain qualified civil servants while maintaining accountability to communities. Practical Implications – For local governments in developing regions, the findings suggest that employee retention strategies cannot rely solely on HR systems or relational leadership alone; both are necessary and complementary. The integrated model offers a practical framework for leadership development programs tailored to rural and peri-urban contexts.