Multivariate Data Analysis Chapter 3 Factor Analysis

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Multivariate Data AnalysisChapter 3 Factor
Analysis

• MIS 6093 Statistical Method
• Instructor Dr. Ahmad Syamil

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Chapter 3

• What is Factor Analysis?
• A Hypothetical Example of Factor Analysis

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Chapter 3Factor Analysis Decision Process

• Stage 1 Objectives of Factor Analysis
• Identifying Structure Through Data Summarization
• Data Reduction
• Using Factor Analysis With Other Multivariate
  Techniques
• Variable Selection

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Chapter 3Factor Analysis Decision Process Cont.

• Stage 2 Designing a Factor Analysis
• Correlations Among Variables or Respondents
• Variable Selection and Measurement Issues
• Sample Size
• Stage 3 Assumptions in Factor Analysis

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Chapter 3Factor Analysis Decision Process Cont.

• Stage 4 Deriving Factors and Assessing
• Overall Fit
• Common Factor Analysis Versus Component Analysis
• Criteria for the Number of Factors to Be
  Extracted
• Latent Root Criterion
• Percentage of Variance Criterion
• Scree Test Criterion
• Heterogeneity of the Respondents
• Summary of Factor Selection Criteria

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Chapter 3Factor Analysis Decision Process Cont.

• Stage 5 Interpreting the Factors
• Rotation of Factors
• An Illustration of Factor Rotation
• Orthogonal Rotation Methods
• QUARTIMAX
• VARIMAX
• EQUIMAX
• Oblique Rotation Methods
• Selecting Among Rotational Methods

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Chapter 3Factor Analysis Decision Process Cont.

• Stage 5 Interpreting the Factors (Cont.)
• Criteria for the Significance of Factor Loadings
• Ensuring Practical Significance
• Assessing Statistical Significance
• Adjustments Based on the Number of Variables
• Interpreting a Factor Matrix
• Examine the Factor Matrix of Loadings
• Identify the Highest Leading For Each Variables
• Assess Communalities of the Variables
• Label the Factors

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Chapter 3Factor Analysis Decision Process Cont.

• Stage 6 Validation of Factor Analysis
• Stage 7 Additional Uses of the Factor Analysis
• Results
• Selecting Surrogate Variables for Subsequent
  Analysis
• Creating Summated Scales
• Conceptual Definition
• Dimensionality
• Reliability
• Validity
• Summary
• Computing Factor Scores
• Selecting Among the Three Methods

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Chapter 3An Illustrative Example

• Stage 1 Objectives of Factor Analysis
• Stage 2 Designing a Factor Analysis
• Stage 3 Assumptions in Factor Analysis
• Component Factor Analysis
• Stages 4 through Stage 7

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Chapter 3An Illustrative Example Cont.

• Stage 4 Deriving Factors and Assessing
• Overall Fit
• Stage 5 Interpreting the Factors
• Applying an Orthogonal (VARIMAX) Rotation
• Naming the Factors
• Applying an Oblique Rotation
• Stage 6 Validation of Factor Analysis

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Chapter 3An Illustrative Example

• Stage 7 Additional Users of the Factor
• Analysis Results
• Selecting Surrogate Variables for Subsequent
  Analysis
• Creating Summated Scales
• Use of Factor Scores
• Selecting the Data Reduction Method

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Chapter 3An Illustrative Example

• Common Factor Analysis
• Stages 4 and 5
• Stage 4 Deriving Factors and Assessing
• Overall Fit
• Stage 5 Interpreting the Factors
• A Managerial Overview of the Results

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Chapter 3

• Summary
• Questions
• References
• Annotated Readings
• ..end