L6M1 – Paper 1 FREE

Indicative model answer

Introduction (3 marks)

Leadership differs from management: management is concerned with planning, organising and controlling existing resources, whereas leadership is about setting direction, creating a vision and influencing people to follow it. The qualities (or traits) approach holds that certain personal characteristics make some individuals more effective leaders. In procurement and supply chain, where the function must influence budget-holders, suppliers and cross-functional colleagues without always holding formal authority, these qualities are decisive.

Five leadership qualities (10 marks)

• Integrity - consistent, ethical decision-making. In procurement this underpins supplier trust and protects the organisation against corruption.
• Emotional intelligence - self-awareness and empathy that let a leader read a negotiation or manage a demotivated buyer.
• Strategic thinking - the ability to align category plans with long-term organisational objectives rather than short-term price.
• Communication - articulating a vision so stakeholders across functions understand and commit to it.
• Resilience - staying effective through supply disruption, price shocks and change resistance.

Leadership style (5 marks)

Transformational leadership (Bass) inspires followers to exceed expectations through a compelling vision, intellectual stimulation and individual consideration. It contrasts with transactional leadership, which relies on rewards and corrective action.

Application to the function (5 marks)

A transformational procurement leader motivates the team to pursue value beyond savings - supplier innovation, sustainability and risk reduction. By articulating a vision (for example, a fully sustainable supply base) and empowering buyers to own categories, the leader raises engagement, reduces staff turnover and accelerates the adoption of strategic sourcing. This directly improves the function's contribution to organisational success.

Conclusion (2 marks)

Effective leadership blends personal qualities with a style suited to context. In a stable transactional environment a more directive style may work, but for driving strategic improvement in procurement, transformational leadership typically delivers the greatest uplift.

📋 LO: 1.2 - Analyse approaches to leadership for improving procurement and supply chain management
📑 Indicative content: 1.2.1 The qualities or traits approach to leadership; 1.2.6 Transformational and inspirational leadership

Indicative model answer (10 marks)

A procurement leader introducing a sustainable-sourcing strategy must influence stakeholders both inside and outside the organisation. Five key groups are:

• Senior management / the board - hold the budget and set strategic priorities. They must be convinced the strategy supports organisational objectives and is financially sound before they will sponsor it.
• Procurement team members (subordinates) - the buyers who will apply the new supplier-selection criteria day to day. Their buy-in determines whether the strategy is implemented consistently.
• Other internal functions - finance (cost impact), operations (continuity of supply) and quality. They may resist if the change threatens established ways of working.
• Suppliers - existing and potential. They must understand new expectations on sustainability, and some incumbents may fear losing business.
• End-users / internal customers - the departments that receive goods and services. They care about service levels and price and need reassurance the change will not disrupt them.

Each group has a different level of interest and influence, which shapes how the leader communicates with them.

📋 LO: 2.3 - Evaluate how to create a communication plan to influence stakeholders in the supply chain
📑 Indicative content: 2.3.1 Stakeholder analysis, including primary, secondary and key stakeholders

Indicative model answer (15 marks)

The communication plan (5 marks)

A communication plan sets out, for each audience: the message (what they need to know and why it benefits them), the channel (board paper, team briefing, supplier day, intranet), the timing and frequency, the owner, and a feedback mechanism so the leader can gauge and respond to reaction. Its purpose is to move stakeholders from awareness to understanding to commitment, not simply to broadcast information.

Stakeholder mapping (5 marks)

Mendelow's power/interest grid plots each stakeholder by their power to affect the strategy and their interest in it:

• High power, high interest (key players) - senior management: manage closely with detailed business cases and regular engagement.
• High power, low interest (keep satisfied) - finance: give concise cost/benefit assurance so they do not block the change.
• Low power, high interest (keep informed) - the buying team and end-users: brief regularly and involve them so they feel ownership.
• Low power, low interest (minimal effort) - peripheral suppliers: a standard written update suffices.

Tailored influencing (5 marks)

The mapping directs effort where it matters. The leader uses evidence and financial modelling to win the board, addresses finance's cost fears directly, and runs workshops with buyers so resistance becomes ownership. Sceptical incumbent suppliers are engaged early with clear expectations and support to adapt. By matching message, channel and effort to each group's position, the plan converts resistance into commitment and gives the strategy the backing it needs to succeed.

📋 LO: 2.3 - Evaluate how to create a communication plan to influence stakeholders in the supply chain
📑 Indicative content: 2.3.2 Communication methods and creating a communication plan; 2.3.4 Perspectives on stakeholder mapping

Indicative model answer

Introduction (3 marks)

Power is the capacity of an individual to influence the behaviour of others. French and Raven (1959) identified five bases of individual power. A procurement leader rarely commands formal authority over budget-holders, other functions or suppliers, so understanding which source of power to draw on - and when - is central to overcoming leadership challenges.

The five sources, applied and evaluated (16 marks)

• Legitimate (positional) power - derived from formal role. Useful for enforcing procurement policy, but it stops at the department boundary and carries no weight with suppliers or peers. Over-reliance breeds compliance, not commitment.
• Expert power - derived from knowledge and competence. A leader with deep category and market expertise wins influence in cross-functional decisions and negotiations. It is the most sustainable base for procurement, though it must be continually renewed and can be undermined if the leader is shown to be wrong.
• Referent power - derived from respect and personal credibility. It secures voluntary followership and helps drive change, but it takes time to build and is fragile - a single ethical lapse can destroy it.
• Reward power - the ability to grant benefits (recognition, development, supplier awards). Effective for motivating the team and incentivising suppliers, but limited by the rewards actually available and prone to producing transactional relationships.
• Coercive power - the ability to punish (poor appraisals, de-listing suppliers). It can enforce short-term compliance in a crisis, but it erodes trust, damages relationships and often backfires, creating resistance rather than engagement.

Critical evaluation (part of 6 marks)

The positional and coercive bases are the least sustainable: they secure obedience but not discretionary effort, and coercion in particular can poison supplier and stakeholder relationships that procurement depends on. Expert and referent power are the strongest foundation for a procurement leader who must influence without authority, because they generate genuine commitment. In practice a leader blends the bases - leading with expertise and credibility, using reward to motivate, and reserving legitimate and coercive power for the rare situations that truly require them.

📋 LO: 3.1 - Contrast the sources of power and how they can be used to overcome common challenges faced by procurement and supply chain leaders
📑 Indicative content: 3.1.1 Perspectives on individual power; 3.1.3 The balance between order and flexibility

Indicative model answer

Introduction (3 marks)

ESG covers the Environmental, Social and Governance impacts of an organisation and its supply chain. Ethical sourcing means securing goods and services in a way that respects people, the environment and the law. Relevant standards include the CIPS Corporate Code of Conduct, the Modern Slavery Act 2015 and the UN's Decent Work / ILO labour codes. Sourcing from overseas suppliers - often in low-cost, low-visibility markets - raises the exposure to ethical failure.

Five ESG risks, assessed (7 + 5 marks)

• Modern slavery and forced labour - a high-impact social risk in extended overseas supply chains; hard to detect below the first tier, and severe in legal and reputational terms.
• Child labour - likely where suppliers subcontract to informal producers; a serious breach of international labour standards.
• Bribery and corruption - a governance risk where local practices differ and oversight is weak; exposes the manufacturer under the Bribery Act 2010.
• Environmental harm - pollution, excessive emissions or unsustainable resource use by suppliers, damaging both the environment and the buyer's reputation.
• Poor working conditions and unfair pay - unsafe workplaces and wages below a living wage; likely where labour regulation is weak.

In this scenario the greatest exposure is in the social risks, because visibility of overseas lower-tier suppliers is limited and the reputational and legal consequences of a modern-slavery finding are the most damaging.

Mitigation (7 marks)

• Set clear expectations through a supplier code of conduct and require sign-up.
• Conduct supplier due diligence before award and ethical audits (announced and unannounced) thereafter.
• Embed ESG contractual clauses with rights to audit, remediation timelines and sanctions for breach.
• Improve traceability beyond tier one and set ESG KPIs monitored through the supplier relationship.
• Provide training and support so suppliers can meet standards, and build an internal culture of ethical commitment.

Conclusion (3 marks)

Procurement should prioritise the social risks with the highest impact - modern slavery and child labour - through robust due diligence and traceability, while embedding ESG requirements into contracts and supplier development so that ethical standards are sustained rather than checked once.

📋 LO: 4.1 - Examine ethical practices and standards that support environmental, social and governance (ESG) considerations in global supply chains
📑 Indicative content: 4.1.1 Promoting ethical practices, codes of conduct and published standards; 4.1.2 Effective supplier due diligence to support ESG compliance; 4.1.3 Contractual clauses to support ESG improvements