Human Resource Analytics has been identified as the application of analytics to human resource core processes and has proved to be a game changer in terms of enhanced decision making, improved productivity of employees, and better alignment of organizational goals to business strategy. This is especially significant as micro and medium-sized enterprises have failed to make effective use of HR analytics despite possessing such huge opportunities in terms of decision-making developments. Economies can thus reap more effective hiring, greater retention of employees, more efficient functioning, and increased compliance with regulatory requirements. Budget constraints, inadequacy of proper skilled resources, resistance to change, and fear of privacy concerns are critical barriers to such widespread adoption of such tools by MSMEs. Further, budget and IT resource constraints which are intrinsic to MSMEs generally imply that they are not able to exploit such sophisticated tools. This paper explores these two dimensions and frame them into a conceptual framework facilitating the understanding of how MSME’s competitiveness and development can be nurtured through HR analytics. This paper also provides appropriate strategies for overcoming such HR analytics adoption barriers such as phase-wise implementation, capacity building, and implementation of less costly, module-based analytics solutions. It is suggested that MSMEs can use HR analytics software to achieve their strategic objectives despite challenges.