This foundational unit provides a comprehensive introduction to Structural Equation Modelling
(SEM), establishing the theoretical and practical foundations necessary for understanding
advanced multivariate statistical techniques. The chapter traces the evolution of SEM from its
origins in path analysis to contemporary applications in diverse research domains. It
systematically explores the fundamental principles underlying both variance-based and
covariance-based SEM approaches, with particular emphasis on Partial Least Squares SEM
(PLS-SEM) methodology. The unit critically examines the theoretical foundations, practical
advantages, and comparative features of different SEM approaches, while establishing the
rationale for selecting appropriate methodological frameworks. Special attention is devoted to
understanding the unique capabilities of SmartPLS software in addressing complex research
challenges across business, social sciences, and management studies. Through detailed
conceptual explanations and comparative analyses, readers will develop a solid foundation for
advanced SEM applications.