Essential new PLS-SEM analysis methods for your entrepreneurship analytical toolbox

Rigorous research across the wide spectrum of entrepreneurship is important for developing knowledge and innovation in the field, which in turn offers building blocks for future inquiry, practice, innovation, and economic growth. For this reason, scholars continually seek new empirical analysis tools to examine constructs and variables included in their research. While many familiar tools remain at the core of the scholar’s tool box, PLS-SEM offers valuable options that have been accentuated by recent developments. This article provides a thorough review of PLS-SEM and its application to current entrepreneurship research, summarizes the emergent confirmatory composite analysis (CCA) processes for applying and interpreting the analysis, explains why PLS-SEM can be especially advantageous for research in this field, and concludes with suggestions for scholars as they plan future research projects. In addition, recent PLS-SEM developments are shared that may effectively apply to entrepreneurship research.

[1]  Pratyush Nidhi Sharma,et al.  Prediction-Oriented Model Selection in Partial Least Squares Path Modeling , 2018, Decis. Sci..

[2]  Joseph F. Hair,et al.  Estimation issues with PLS and CBSEM: Where the bias lies! ☆ , 2016 .

[3]  Marko Sarstedt,et al.  The Use of Partial Least Squares Structural Equation Modeling in Strategic Management Research: A Review of Past Practices and Recommendations for Future Applications , 2012 .

[4]  Marko Sarstedt,et al.  Factors versus Composites: Guidelines for Choosing the Right Structural Equation Modeling Method , 2019 .

[5]  J. Kotlar,et al.  Entrepreneurial orientation and firm performance in family SMEs: the moderating effects of family, women, and strategic involvement in the board of directors , 2018 .

[6]  F. J. García-Rodríguez,et al.  Entrepreneurial intentions in diverse development contexts: a cross-cultural comparison between Senegal and Spain , 2015 .

[7]  Rudolf R. Sinkovics,et al.  A Critical Look at the Use of SEM in International Business Research , 2014 .

[8]  E. Hansen,et al.  Response to the global financial crisis: a follow-up study , 2018, Journal of Innovation and Entrepreneurship.

[9]  Christian Nitzl,et al.  The use of partial least squares structural equation modelling (PLS-SEM) in management accounting research: Directions for future theory development , 2016 .

[10]  Michael H. Morris,et al.  Understanding the dynamics of entrepreneurship through framework approaches , 2015, Small Business Economics.

[11]  Wynne W. Chin,et al.  The case of partial least squares (PLS) path modeling in managerial accounting research , 2017 .

[12]  Soumya Ray,et al.  Chapter 3 Predictions from Partial Least Squares Models , 2018, Applying Partial Least Squares in Tourism and Hospitality Research.

[13]  Marko Sarstedt,et al.  Mirror, mirror on the wall: a comparative evaluation of composite-based structural equation modeling methods , 2017, Journal of the Academy of Marketing Science.

[14]  Judy McKay,et al.  A Metadesign Theory for Tailorable Decision Support , 2019, J. Assoc. Inf. Syst..

[15]  Hyrije Abazi-Alili,et al.  The impact of knowledge spillovers and innovation on firm-performance: findings from the Balkans countries , 2017 .

[16]  Augustine A. Lado,et al.  Regulatory focus, environmental turbulence, and entrepreneur improvisation , 2018 .

[17]  Joseph F. Hair,et al.  PLS-SEM or CB-SEM: updated guidelines on which method to use , 2017 .

[18]  Jennifer E. Jennings,et al.  Living the Dream? Assessing the “Entrepreneurship as Emancipation” Perspective in a Developed Region , 2016 .

[19]  Andrew F. Hayes,et al.  Conditional Process Analysis: Concepts, Computation, and Advances in the Modeling of the Contingencies of Mechanisms , 2020, American Behavioral Scientist.

[20]  Virginia Barba-Sánchez,et al.  Entrepreneurial motivation and self-employment: evidence from expectancy theory , 2017 .

[21]  S. Gudergan,et al.  Partial least squares structural equation modeling in HRM research , 2020 .

[22]  Joseph F. Hair,et al.  When to use and how to report the results of PLS-SEM , 2019, European Business Review.

[23]  G. Mateos-Aparicio Partial Least Squares (PLS) Methods: Origins, Evolution, and Application to Social Sciences , 2011 .

[24]  Zaleha Mohamad,et al.  Comparative Analysis of Sustainable Entrepreneurship among the East Coast Homestays in Malaysia , 2019 .

[25]  Jahangir Yadollahi Farsi,et al.  Social Capital and Organizational Innovation: The Mediating Effect of Entrepreneurial Orientation , 2013 .

[26]  Gregory G. Dess,et al.  Clarifying the Entrepreneurial Orientation Construct and Linking It To Performance , 1996 .

[27]  Marko Sarstedt,et al.  Partial least squares structural equation modeling (PLS-SEM): An emerging tool in business research , 2014 .

[28]  Waymond Rodgers,et al.  Potential model misspecification bias: Formative indicators enhancing theory for accounting researchers , 2011 .

[29]  R. Lussier,et al.  Prediction model of business success or failure for Palestinian small enterprises in the West Bank , 2018 .

[30]  Yu-Te Liu Exploring the role of original aspiration in effectuation tendency , 2019, International Entrepreneurship and Management Journal.

[31]  Manuela Vega-Vázquez,et al.  Entrepreneurial orientation–hotel performance: Has market orientation anything to say? , 2016 .

[32]  R. Schalk,et al.  Feeling successful as an entrepreneur: a job demands — resources approach , 2016 .

[33]  Herman Wold,et al.  Soft modelling: The Basic Design and Some Extensions , 1982 .

[34]  Galit Shmueli,et al.  To Explain or To Predict? , 2010 .

[35]  From What We Know to How We Use It: Five Principles for Turning Entrepreneurship Research into Practitioner Action Guidelines , 2004 .

[36]  Pankaj C. Patel Opportunity related absorptive capacity and entrepreneurial alertness , 2018, International Entrepreneurship and Management Journal.

[37]  S. Kraus,et al.  Entrepreneurial orientation in vertical alliances: joint product innovation and learning from allies , 2016 .

[38]  Marko Sarstedt,et al.  An assessment of the use of partial least squares structural equation modeling in marketing research , 2012 .

[39]  Christian Nitzl,et al.  Beyond a tandem analysis of SEM and PROCESS: Use of PLS-SEM for mediation analyses! , 2020 .

[40]  Siti Norbaya Daud,et al.  EXPLORATORY FACTOR ANALYSIS OF ENTREPRENEURSHIP TRAITS AMONG ENGINEERING STUDENTS , 2019, International Journal of Entrepreneurship and Management Practices.

[41]  K. Jöreskog A General Method for Estimating a Linear Structural Equation System. , 1970 .

[42]  I. J. Myung,et al.  When a good fit can be bad , 2002, Trends in Cognitive Sciences.

[43]  W. Hameed,et al.  Determinants of Firm’s open innovation performance and the role of R & D department: an empirical evidence from Malaysian SME’s , 2018, Journal of Global Entrepreneurship Research.

[44]  Barry J. Babin,et al.  Publishing Research in Marketing Journals Using Structural Equation Modeling , 2008 .

[45]  A. Al-Swidi,et al.  The mediating role of total quality management between the entrepreneurial orientation and the organizational performance , 2016 .

[46]  Alain Yee-Loong Chong,et al.  An updated and expanded assessment of PLS-SEM in information systems research , 2017, Ind. Manag. Data Syst..

[47]  A. Mohammed Measuring Students Entrepreneurial Intentions: The Study of Al Dhafra region, Abu Dhabi, UAE , 2019 .

[48]  M. Iniesta-Bonillo,et al.  Sustainable entrepreneurial orientation within an intrapreneurial context: effects on business performance , 2018, International Entrepreneurship and Management Journal.

[49]  Colin C. Williams,et al.  Informal Entrepreneurship in Developing Economies: The Impacts of Starting up Unregistered on firm Performance , 2016 .

[50]  M. Joshi,et al.  Examining Entrepreneurial Intention in Higher Education: An Exploratory Study of College Students in India , 2018 .

[51]  T. Micceri The unicorn, the normal curve, and other improbable creatures. , 1989 .

[52]  Marko Sarstedt,et al.  How to Specify, Estimate, and Validate Higher-Order Constructs in PLS-SEM , 2019, Australasian Marketing Journal.

[53]  Galit Shmueli,et al.  The elephant in the room: Predictive performance of PLS models , 2016 .

[54]  Galit Shmueli,et al.  Predictive model assessment in PLS-SEM: guidelines for using PLSpredict , 2019, European Journal of Marketing.

[55]  K. Zarafshani,et al.  Cultural values and entrepreneurial intentions among agriculture students in Iran , 2017 .

[56]  Galit Shmueli,et al.  Predictive Analytics in Information Systems Research , 2010, MIS Q..

[57]  Godfrey Isaac Mwandosya,et al.  Exploring the contribution of business and technology incubators to women entrepreneurs’ business development in Dar es Salaam, Tanzania , 2018, Journal of Global Entrepreneurship Research.

[58]  Marko Sarstedt,et al.  Rethinking some of the rethinking of partial least squares , 2019, European Journal of Marketing.

[59]  Pratyush Nidhi Sharma,et al.  PLS-Based Model Selection: The Role of Alternative Explanations in Information Systems Research , 2019, J. Assoc. Inf. Syst..

[60]  William C. McDowell,et al.  The price of success: balancing the effects of entrepreneurial commitment, work-family conflict and emotional exhaustion on job satisfaction , 2019, International Entrepreneurship and Management Journal.

[61]  J. Ferreira,et al.  What are the antecedents of women’s entrepreneurial orientation? , 2017, International Entrepreneurship and Management Journal.

[62]  D. Urbig,et al.  Entrepreneurial Orientation: The Dimensions' Shared Effects on Explaining Firm Performance , 2017 .

[63]  José L. Roldán,et al.  European management research using partial least squares structural equation modeling (PLS-SEM) , 2015 .

[64]  Marko Sarstedt,et al.  Editorial - Partial Least Squares Structural Equation Modeling: Rigorous Applications, Better Results and Higher Acceptance , 2013 .

[65]  Faizan Ali,et al.  An Assessment of the Use of Partial Least Squares Structural Equation Modeling (PLS-SEM) in Hospitality Research , 2017 .

[66]  Mulugeta F. Dinbabo,et al.  Beyond entrepreneurship education: business incubation and entrepreneurial capabilities , 2018 .

[67]  Marko Sarstedt,et al.  Partial least squares structural equation modeling (PLS-SEM): A useful tool for family business researchers , 2014 .

[68]  Stacie Petter,et al.  "Haters Gonna Hate": PLS and Information Systems Research , 2018, Data Base.

[69]  R. Fenech,et al.  Entrepreneurial Attitudes, Self-Efficacy, and subjective Norms Amongst Female Emirati entrepreneurs , 2019 .

[70]  Kenneth A. Merchant,et al.  Making management accounting research more useful , 2012 .

[71]  Eiad Yafi,et al.  Does ICT Based Network Competence Mediate Strategic Competencys Impact On SMEs Competitve Advantage? An Empirical Evidence From Malaysian Manufacturing SMEs , 2019 .

[72]  Carlo Lauro,et al.  Predictive Path Modeling Through PLS and Other Component-Based Approaches: Methodological Issues and Performance Evaluation , 2017 .

[73]  Marko Sarstedt,et al.  PLS-SEM: Indeed a Silver Bullet , 2011 .

[74]  Joe F. Hair,et al.  Assessing measurement model quality in PLS-SEM using confirmatory composite analysis , 2020 .

[75]  Joseph F. Hair,et al.  On the Emancipation of PLS-SEM: A Commentary on Rigdon (2012) , 2014 .

[76]  Saurabh Srivastava,et al.  Influence of innovation competence on firm level competitiveness: an exploratory study , 2017 .