Moderation Analysis using SMART-PLS

Learn to use Moderation Analysis using SMART-PLS.

What is a Moderating Variable?

  • A moderating variable is the one that modifies the existing relationship between the independent and dependent variable I-e it holds a strong contingent effect on the association of IV and DV
  • Although, MV is not influenced by IV but affects the strength and direction of the relationship between IV and DV.
  • For instance the theory suggests that Dissatisfaction at work leads to Turnover, however this might not be true in developing countries like Pakistan. The reason could be attributed to lack of Job Opportunities.
  • Now in this particular case Job Opportunities is modifying the existing expected relationship between the IV (Dissatisfaction at work) and DV (Turnover) as naturally if someone is dissatisfied at work, he/she would think of moving to some other job. So we would say that Job Opportunities is a MV.

What is a Moderation?

  • When moderation is present, the strength or even the direction of a relationship between two constructs depends on a third variable.
  • Moderation describes a situation in which the relationship between two constructs is not constant but depends on the values of a third variable, referred to as a moderator variable.
  • As was the case in the last example, where job opportunities weakened the relationship.
  • In other words, the nature of the relationship differs depending on the values of the third variable.
  • A moderation hypothesis can be represented in a diagram as

Reporting Moderation Analysis

H1: Community Hostility Moderates the relationship between Servant Leadership and Role Conflict such that a higher level of community hostility would strengthen the negative relationship between Servant Leadership and Role Conflict.

The hypothesis sought to ascertain the moderating role of CH between SL and RC. The results revealed that CH moderates the relationship between SL and RC (B = .244, t = 3.431, p < .001). However, the results reveal (see figure 1), that at higher CH, the SL fails to impact RC. The results revealed that at lower CH, SL was found to have a stronger impact on RC.

Watch the Video Tutorial to Learn how to perform Moderation in SMART-PLS