Partial least squares structural equation modeling in HRM research

Abstract

Partial least squares structural equation modeling (PLS-SEM) has become a key multivariate analysis technique that human resource management (HRM) researchers frequently use. While most disciplines undertake regular critical reflections on the use of important methods to ensure rigorous research and publication practices, the use of PLS-SEM in HRM has not been analyzed so far. To address this gap in HRM literature, this paper presents a critical review of PLS-SEM use in 77 HRM studies published over a 30-year period in leading journals. By contrasting the review results with state-of-the-art guidelines for use of the method, we identify several areas that offer room of improvement when applying PLS-SEM in HRM studies. Our findings offer important guidance for future use of the PLS-SEM method in HRM and related fields.

Keywords:

• Partial least squares
• structural equation modeling
• PLS-SEM
• HRM
• guidelines
• review

Acknowledgements

Even though this research does not explicitly refer to the use of the statistical software SmartPLS (http://www.smartpls.com), Ringle acknowledges a financial interest in SmartPLS.

Notes

1. Note that there also exist controversies regarding the nature and usefulness of formative measurement (e.g. Bollen & Diamantopoulos, 2017).

2. Throughout this article, we use the term ‘studies’ when we discuss the 77 journal articles and use the term ‘models’ when discussing the 114 PLS path models estimated in these papers.