Predictive HR Analytics: A Strategic Tool for XYZ Organic Foods' Growth

Introduction   

The purpose of this critical analysis is to evaluate the role of Predictive HR Analytics (PHRA) in enhancing the HR benefits and decision-making process for a small organization. Also, the key purpose of this assessment is to understand and connect ideas, identify risks and recognise inconsistencies to develop a big-picture perspective of PHRA within an organisation.

‘XYZ Organic Foods’ is a small and local organic food supplier and retailer, operating currently in Melbourne. It is a family-owned business and has a key focus on selling organic and home-grown vegetables and fruits. Currently, it has a small team of 30 employees. The company is facing significant challenges due to high employee turnover, and employee demotivation. The HR manager is facing difficulties in predicting staffing needs, improving the work environment, and retaining staff (Madhani 2023:37).

Predictive HR analytics (PHRA) is a level of human resource analytics, that helps in making quality and people-related decisions, to improve both individual and organizational performance (Ejo-Orusa and Okwakpam, 2018:258). Predictive analytics analysis is a pattern of the data that builds association to check and determine if the employee pattern is the same in the future. Hence, this will help the HR manager of the firm to be prepared to deal with similar issues in the future (Srividya and Shripria 2021:1).

This report will analyze the key factors that will impact the decision of PHRA adoption. Secondly, it will discuss key benefits and barriers in the implementation process, Lastly, based on the discussion, the report will present a strong argument for the manager of ‘XYZ Organic Foods’.

Key Factors, benefits and barriers

1.      Key factors that impact predictive HR analytics.

Organizations that are capitalizing big data and analytics into core business functions, were able to transform using data, which gave them power to achieve a competitive advantage. Similarly, by incorporating HR analytics, HR managers can make better decisions, which is associated with better performance (Fernandez and Gallardo-Gallardo 2021:3). Additionally, this study has identified 14 key factors that help companies adopt HR analytics, successfully (Table 1 Appendix). Firstly, one of the main contingency factors that influence the application of HR analytics is to adopt innovation and improve organizational performance (Pongpisutsopa et al., 2020:850).

According to (Fernandez and Gallardo-Gallardo 2021:43), one of the key factors that help in PHRA adoption is the ability of predictive HR analytics to address the business or HR-related problem. For this, the first step should be to clearly define the problem faced by the company. Additionally, the three main factors/antecedents that affect the adoption of HR analytics are: technology, organization and the people (Zeidan and Itani 2020:684; Shet et al. 2021). Where, technology factors require the HR manager to analyse the IT infrastructure and use of technology in the company. For organizational factor means that what will be the impact of using HR analytics on the organization and people means, that do employees and managers have skills and capabilities to use this tool (Zeidan and Itani 2020:685).