FACTOR ANALYSIS

PRESENTED BY:
SUNANDA PRIYADARSHINI ROUL
CHARANJEET NAYAK
OJASWI GUPTA
CONTENT
1. WHAT IS IT ?
2. WHERE IT USE ?
3. TYPES
4. STEP BY STEP PROCESS
5.SIMPLY PUT
6.SPSS
 WHAT IS FACTOR ANALYSIS

• Statistical technique for reducing variables.

• Also known as data reduction.
• Interdependence technique where an entire
set of interdependent relationships are
examined.
WHERE IT USED ?

In Market Research:
On Smartphone Preferences for example:-
• Collects data from large consumer sample.
• Analyzes variables like screen size, camera quality, battery life, price.
• Groups variables into underlying factors: performance, design, affordability.
• Helps smartphone companies tailor products to meet consumer needs.

Evaluation of New Teaching Method in Education

• Collecting data on academic outcomes like test scores, attendance rates, and
student engagement.
• Factor analysis identifies underlying factors like academic achievement,
attendance and participation, and motivation.
• Understanding impactful aspects and areas for improvement.
 TYPES

 Exploratory Factor Analysis (EFA)

Helps find hidden patterns in data by grouping similar
variables together, revealing underlying factors without
any initial assumptions.

 Confirmatory Factor Analysis (CFA)

Checks if data fits a specific model where observed
variables are connected to underlying factors as we
expect.
 STEP BY STEP PROCESS
1.Define your goal
2.Choose your method
3.Select your variables
4.Collect your data
5.Preprocess the data
6.Choose the number of factors
7.Factor extraction
8.Interpret factors
9.Rotate factors
10.Assess model fit
11.Interpret results
12.Report findings
SIMPLY
PUT :-

 KMO:- (The Kaiser-Meyer-Olkin) statistic measures the suitability of data for factor analysis by assessing the
proportion of variance among variables that might be caused by underlying factors.
 COMMUNALITIES:- Communalities in factor analysis represent the proportion of variance in each observed
variable that is accounted for by the common factors.
 TOTAL VARIANCE:- In factor analysis refers to the overall variability in the observed variables that is
explained by the underlying factors being analyzed.
 A SCREEN PLOT:- In factor analysis is a visual representation showing the eigenvalues of each factor, aiding in
determining the number of meaningful factors to retain.
 COMPONENT MATRIX:- In factor analysis displays the original pattern of loadings between variables and
factors before rotation.
 ROTATED COMPONENT MATRIX:- In factor analysis presents the pattern of loadings after rotation, making it
easier to interpret the relationships between variables and factors.
 COMPONENT TRANSFORMATION MATRIX:- In factor analysis is used to convert the original factor
loadings to rotated factor loadings, aiding in interpretation and simplifying the structure of the factors.
 EXAMPLE

A survey asking 30 customers to a particular brand on a scale

of 1 (Very dissatisfied) to 5 (Very Satisfied).
We take 30 customers feedback on product quality, service
responsiveness, price satisfaction, overall experience
• 1st input Data in excel sheet as described in example.
• We import data from the excel file then go to the analyze then Dimension Reduction.
Then factors.
• Factor Analysis Dialog box will appear on screen
• Go to descriptives.
• Then go to extraction
• Then go to Rotation .
 KMO score is 0.446, This recommends for
not acceptance of the factor analysis
with the chosen set of variables.
 The value of KMO is mote than or = to 0.7
 In component no 3 & 4 the extraction ssl & Rotation ssl is
not visible because there is similarities.
 SSL- SUM OF SQUARED LOADING
THANK YOU.