What makes the task of a moderator particularly challenging is that no two communities have the same idea of what a moderator is supposed to be. Every administrator or community owner has their own expections of what tasks a moderator should perform. Some admins would think of moderators as nearly equals or as junior administrators and give them a great deal of power and responsibility. Others might consider moderators as just "hatchet-men" to perform the menial jobs of cleaning up spam and keeping the forums tidy. Yet another administrator might think that moderators should be there to shield the admins from direct criticism by letting them take the heat for all issues that arise on the forum.
The best administrators usually are the ones who give their moderators the necessary freedom to interpret the forum policy and rules and implement them on a daily basis without much interference. The best admins also know when to stand up and defend their moderators in public and when to override their decisions - doing so as tactfully and as painlessly as possible. The best admins allow moderators to perform efficiently without giving them the impression that they're always looking over their shoulders.
So what does it take to be a moderator? Here are the challenges a new moderator will face in any community.
A problem that any member newly appointed as a moderator will face is in adjusting to the "senior/junior" problem. How does a moderator who's been one of the boys now start enforcing with authority on the forum? There might be other members who've been around as long or longer than the moderator on the forum and they might definitely intimidate the new moderator. The older members of the forum would definitely take time to adjust to the fact that a certain member might have been promoted ahead of them.
In such instances, the new moderator needs a lot of support and backup from the admin. If you, as a newly appointed moderator don't feel that you're getting the moral support from your fellow moderators, you probably need to discuss a strategy in private on how to deal with the senior members who potentially intimidate new moderators.
Establishing a moderation pattern
A new moderator needs time to adjust to a pattern and settle down to it. A lot of the initial problem in moderation can be put down to a lack of adjustment to the new position and also not knowing when to act and when not to act. The first couple of moderation actions by any new moderator will always be tough but over a period of time, a pattern is set which makes life a lot easier.
Knowing the limits of authority
The difference between an admin and a moderator is very clear-cut when we talk about limits of authority. Most communities set a definite limit to moderator powers either by controlling moderation feature access to features or just by policy. In the first instance, it's easy, because a new moderator knows he cannot perform user banning (for instance) but does he know whether he's allowed to delete or remove threads even if given that power? It's important that in cases where the line is blurred, the moderator follows the existing trend of moderation followed by other forum moderators and ask the administrator for clarifications when needed.
The admin-moderator relationship
This is probably the most important factor to gauge for any new moderator. How much trust has the admin placed in you? What is the level of confidence he has in the moderators' abilities? There are no easy ways to find this out except by experience and by looking at past history and finding out the level of moderator satisfaction in the community. If the past moderators are disgruntled or angry, they might not necessarily say so openly, but over time, it will be quite apparent how the admin treats the mods.
A simple rule of thumb. Sound simple, but holds very true - if the admins trust you, you'd hardly feel under pressure over a period of time.
Quality vs. Quantity
Quite simply if the moderation policy includes any conditions about how many hours a day you have to put in as a moderator, it's probably not going to work out. Admins who treat moderators as employees and expect them to stay online for unreasonably long periods of time probably don't have the right idea of what to expect. They probably think moderators aren't really people who live real lives or have families and jobs. 99% of moderatorship is voluntary service to a community. Good admins know this and don't pressurize people to dedicate time to the community. If the community is good enough, they'll get enough people who'll joyfully share these responsibilities and make it easier.
The same goes for admins who expect "x" number of moderation actions per day/week/month. It's probably not worth being a moderator of such a community.
"Dont have any more opinions"
If the moderators of a community are expected not to take sides on any issues or debates of a community, the admin is probably looking for robots. Maybe somebody will invent a moderation bot some day, but in the meantime, expecting moderators to change their basic nature and act only as community enforcers and relinquish their roles as normal members probably won't get too many volunteers for the job.
Similarly admins who expect moderators to post only useful/informational messages all the time probably expect too much. The best way is to just allow people to be natural. The best way to judge how happy a community is is by seeing how active the moderators are in social activity.
Back up and support
A moderator who takes a controversial decision would feel more confident if admins supported them at least in public. Privately there might be disagreement, but if the admin steps on a moderator's toes in public and makes negative remarks about the moderator's quality of work, it's probably time to step down from the post.
The best admins know this and never, ever let their moderators down in public particularly when there's no abuse of power and the intent was proper. Everybody makes mistakes or gets overenthusiastic about the job.
Finally... between the devil and the deep sea
The toughest challenge for a moderator is probably when he/she gets caught in an open war between the members and the administrators of a community. Moderators often face delicate situations where they are challenged or called upon to give their opinions when it would be inconvenient to do so. On the one hand, most moderators will want to be seen as intelligent, mature and independent and not as stooges of the forum leaders parroting the official line. On the other hand, they don't want to say anything that might add fuel to the raging fire and give ammunition for the rebels to attack the leadership with. When rebellious forum members think that it would be a good idea to sow seeds of discord in the leadership of a community, moderators definitely have a very unenviable task.
The good administrators always take responsibility for handling such kinds of rebellious situations personally without involving any of the moderators. The challenge is probably to communicate to the moderators themselves how to conduct such threads because any divergence in views in the open forum would be fresh meat for rebels.
It's always tough for moderators in any community because they don't have the complete authority that admins have and at the same time they're a very important link in the chain of authority. The best administrators know how to nurture a band of trusted, high quality members who will always remain as pillars of strength to the community leadership rather than turn into a major liability. It all comes down to people skills.