Methods and Theory for Using Parcels in Management Research: An Overview and Guide for Improved Analysis

Research questions and subsequent methodology in the field of management continue to evolve, bringing about more complex models and heightened data requirements and considerations. Thus, the difficulties associated with meeting the requirements of growing methodological rigor (e.g., increasing sample size) have influenced scholars to develop procedures aimed at mitigating these challenges. One such practice is parceling or combining subsets of scale items to form composite indicators of latent variables. Since introduced, parceling approaches have proliferated in a piecemeal fashion, leading to inconsistencies and inaccuracies regarding how parceling is both conducted and reported. With limited consensus about how to parcel, scholars risk perpetuating disjointed, incomplete, or errant approaches that confound the quality of research, accenting the need for a review that organizes the concept of parceling. In response, we offer an examination of parceling in management research with the aim of offering much-needed insight and instruction. To accomplish this, we provide insights that include an overview of parceling from practical and theoretical standpoints, needed clarification surrounding the importance of construct dimensionality when parceling, and robust, informed insights into best practices to aid future researchers in appropriately crafting and reporting on parceling moving forward.