Reliability indicates consistency of measurement items to measure a common construct.
The traditional criterion for internal consistency is Cronbach's alpha, which provides an estimate of the reliability based on the inter-correlations of the observed indicator variables.
Limitation of Cronbach's Alpha:
It assumes that all indicators are equally reliable (i.e., all the indicators have equal factor loadings on the construct).
It is sensitive to the number of items in the scale & generally tends to underestimate the internal consistency reliability.
To overcome the limitations of Cronbach's Alpha, Composite Reliability (CR) is suggested as a replacement of the traditional criterion.
If CR < 0.70, then item with the lowest factor loading for that particular construct should be considered to be deleted.
CR of 0.60 to 0.70 are acceptable in exploratory research, while in more advanced stages of research, values between 0.70 and 0.90 can be regarded as satisfactory (Nunally & Bernstein, 1994).
Values above 0.90 (and definitely> 0.95) are not desirable because they indicate that all the indicator variables are measuring the same phenomenon and are therefore unlikely to be a valid measure of the construct.
Use the calculator here to calculate CR.
Step 1: At the Analyze Tab, select Scale, and Reliability Analysis.
Step 2: Select items for a construct and transfer to the right box labelled as Item
Step 3: Click Statistics. Select the required reliability statistics. Continue, and OK.
Step 4: Repeat the same process for each construct.