Factor structure of the Indonesian Entrepreneurial Competence Inventory: A bifactor-ESEM study

Abstract

Orientation: Entrepreneurial competence (EC) is important for entrepreneurial success. Situational judgement test (SJT) is a promising tool for assessing EC, but its construct validation often faces methodological challenges.
Research purpose: This study aims to re-examine the factor structure of the short version of the Indonesian Entrepreneurial Competence Inventory (IECI), an SJT for measuring EC in the Indonesian context.
Motivation for the study: Previous studies produced conflicting findings: exploratory factor analysis supported a three-dimensional model, while confirmatory factor analysis (CFA) indicated nine-dimensional model. This disparity most likely caused by the limitations of CFA in modelling complex SJT data, creating validity ambiguity.
Research approach/design and method: Data were collected from 498 entrepreneurs in the micro, small, and medium enterprises sector in Indonesia. The IECI factor structure was analysed using exploratory structural equation modelling (ESEM) and bifactor ESEM.
Main findings: The bifactor ESEM model provided the best fit, revealing one strong general factor (g-factor) and three weaker specific factors. These findings reconcile previous studies by demonstrating that EC has a hierarchical structure.
Practical/managerial implications: The total IECI score has been proven to be a highly reliable measure of general EC. However, the interpretation of sub-dimension scores must be done with caution because of their smaller variance contribution.
Contribution/value-add: This study resolved on the IECI’s dimensionality by applying more appropriate psychometric method. The findings advance the theoretical understanding of EC as a bifactor construct and strengthen the IECI’s validity.