What If My Test for Common Method Bias Is Significant in SEM Model?

You will need to include the common method variable and its relationships to all the indi- cators when you start testing the structural relationships between constructs. By including the common method variable in the testing of the structural relationships, you are con- trolling for the potential bias of the common method. If you want to see exactly where the potential bias is originating from, you can go to the standardized regression weights of the CFA output that has the common method construct included. In the standardized regression weights, examine the relationships from the common method construct to the indicators and observe which indicator is loading at a high level. This is a good indication of where the common method bias is coming from that is causing a significant chi-square differ- ence test between the original CFA and the CFA with a common method variable included.

Source: Thakkar, J.J. (2020). “Procedural Steps in Structural Equation Modelling”. In: Structural Equation Modelling. Studies in Systems, Decision and Control, vol 285. Springer, Singapore.