CIPS L6M1 - Strategic Ethical Leadership

Overall explanation

Below you will find how you can plan and draft the essay. Remember this is an example of one way you could approach the question. At Level 6 the questions are much more open so your response may be completely different and that's okay.

Essay Plan

Intro – ethical supply chain management = environment, society and wellbeing of stakeholders

P1 – corporate governance

P2 – bribery and corruption

P3 – insider trading

P4 - discrimination

Conclusion - Upholding these ethical principles not only benefits the organization but also contributes to a more just and responsible global business environment.

Example Essay

Ethical supply chain management involves the integration of ethical principles and practices into every aspect of a supply chain's operations. It focuses on ensuring that the supply chain not only meets its goals of efficiency, cost-effectiveness, and profitability but also operates in a manner that is socially responsible and aligned with moral values. Ethical supply chain management aims to create value while considering the impact on the environment, society, and the well-being of all stakeholders involved, particularly those that have traditionally been exploited or marginalised. Supply chain managers play a pivotal role in establishing and upholding ethical standards within the supply chain.

Corporate Governance:

Corporate governance refers to the framework of rules, practices, and processes by which a company is directed and controlled. It encompasses the relationships among the company's management, its board of directors, shareholders, and other stakeholders. Supply chain managers should ensure that their organization's corporate governance practices are transparent, accountable, and aligned with ethical standards.

For example, the Enron scandal in the early 2000s serves as a stark reminder of the consequences of poor corporate governance. Enron's executives engaged in unethical and fraudulent practices, leading to the company's collapse. This scandal highlighted the importance of transparent corporate governance to prevent such lapses.

Supply chain managers can contribute to ethical corporate governance by establishing mechanisms for transparency, accountability, legal compliance, and ethical oversight within the supply chain.

Bribery and Corruption:

Bribery involves the offering, giving, receiving, or soliciting of something of value with the aim of influencing the actions of an official or other person in a position of authority. Corruption, on the other hand, encompasses a broader range of dishonest or unethical behaviour, including bribery, embezzlement, and abuse of power. Supply chain managers must actively combat bribery and corruption within the supply chain.

One prominent example of bribery and corruption in the supply chain is the case of the Brazilian construction giant Odebrecht. The company was involved in a vast bribery scheme across Latin America, implicating high-ranking politicians and business leaders. This case underscores the far-reaching consequences of unethical practices within the supply chain.

To mitigate the risk of bribery and corruption, supply chain managers should implement anti-bribery policies, conduct due diligence on suppliers, establish reporting mechanisms, and regularly audit and monitor the supply chain for compliance.

Insider Trading:

Insider trading involves trading securities based on non-public, material information. It is a form of market abuse that undermines fairness and transparency in financial markets. Supply chainmanagers should address insider trading risks within the organization.

A well-known example of insider trading is the case of Martha Stewart, the American businesswoman and television personality. Stewart sold her shares in a pharmaceutical company, ImClone Systems, based on non-public information about the FDA's impending rejection of the company's drug application. She was later convicted of insider trading.

To prevent insider trading, supply chain managers can limit access to sensitive information, educate employees about insider trading laws, establish monitoring and reporting mechanisms, and ensure legal compliance.

Discrimination:

Discrimination involves treating individuals unfairly or unequally based on their characteristics, such as race, gender, age, or disability. Discrimination within the supply chain can have detrimental social and legal consequences.

To combat discrimination, supply chain managers should promote equal opportunity, implement diversity initiatives, conduct training and awareness programs, and enforce non-discrimination policies throughout the supply chain.

In conclusion, ethical supply chain management is integral to an organization's overall sustainability and reputation. Supply chain managers should actively manage ethics in areas such as corporate governance, bribery, corruption, insider trading, and discrimination to ensure that the supply chain operates ethically, complies with legal standards, and aligns with moral values. Upholding these ethical principles not only benefits the organization but also contributes to a more just and responsible global business environment.

Tutor Notes

- For a higher score you should mention some of the legislation surrounding these areas:

- Corporate Governance = Companies Act 2006: This legislation lays out the statutory duties of company directors and officers, addresses corporate governance issues, and provides requirements for financial reporting, disclosure, and shareholder rights.

- Corporate Governance = UK Corporate Governance Code: Although not a law, this code issued by the Financial Reporting Council (FRC) sets out principles of good corporate governance that UK-listed companies are encouraged to follow. It provides guidelines on board composition, transparency, accountability, and more.

- Bribery and Corruption: Bribery Act 2010: This act is the primary legislation governing bribery and corruption in the UK. It introduced strict anti-bribery provisions, including criminal offenses related to bribery, both domestically and internationally.

- Insider Trading: Criminal Justice Act 1993: Part V of this act includes provisions related to insider dealing (insider trading) offenses. It criminalizes the misuse of insider information in relation to securities and other financial instruments.

- Discrimination: Equality Act 2010: This comprehensive legislation addresses discrimination on various grounds, including age, disability, gender, race, religion or belief, sexual orientation, and gender reassignment. It provides protection against discrimination in employment, education, housing, and other areas of public life.

Overall explanation

Below you will find how you can plan and draft the essay. Remember this is an example of one way you could approach the question. At Level 6 the questions are much more open so your response may be completely different and that's okay.

Essay Plan

Introduction – what is control?

1) Direct control – issuing orders, direct supervision, can lead to resentment

2) Bureaucracy – clear definitions, standardisation and processes

3) Influencing – bring a person’s values in line with the values of the organisation

4) Social / Cultural – encourage people to conform by changing the norms of the organisation

5) KPIs – individuals are evaluated to set standards

Conclusion – leader should use a variety of methods

Example Essay

Control in leadership refers to the processes, strategies, and mechanisms that leaders use to regulate, guide, and manage the activities and behaviours of individuals or groups within an organization. Effective control helps leaders ensure that the organization operates efficiently, achieves its goals, and adheres to its values and standards. This essay will discuss a variety of methods that a leader can use to exercise control.

1) Direct Control:

Direct control is a leadership method where leaders issue explicit orders and closely supervise tasks, often making decisions without significant input from others. For example in a manufacturing company, a supervisor instructs workers on the assembly line to follow a specific sequence of tasks and closely monitors their work to ensure compliance. The advantage to this method is that tasks are executed as instructed, resulting in predictable outcomes and that expectations and roles are well-defined, which reduces ambiguity. However this method of control can lead to resentment, decreased motivation, and a lack of autonomy among team members. Team members may be less inclined to propose innovative solutions or take initiative when micromanaged.

2) Bureaucracy:

Bureaucracy is a method of control characterized by clear definitions, standardized processes, and established rules and procedures within an organization. Government agencies often operate within a bureaucratic framework, where specific rules and regulations guide decision-making and operations. The advantage of this form of control is that it ensures decisions and actions align with established rules and procedures. It also promotes equal treatment of individuals within the organization. The disadvantage is that Bureaucratic structures may struggle to adapt to changing circumstances and hinder organizational agility. Moreover, excessive bureaucracy can lead to administrative burdens and create barriers to efficient decision-making.

3) Influencing:

Influencing is a control method focused on aligning an individual's values, beliefs, and behaviours with those of the organization. It encourages voluntary compliance. An example of this is a manager motivating their team to meet sales targets by emphasizing the benefits of achieving those goals for both the company and individual team members. This form of control can be highly effective as it encourages voluntary compliance; team members willingly align their values and behaviours with the organization's goals and it fosters a shared sense of purpose and commitment among employees. However it has many limitations; it is time consuming, requires effort to build trust and rapport, is dependant upon the personality, skill and likeability of the leader and it is not an effective form of control in situations where immediate compliance is crucial.

4) Social/Cultural Control:

Social/cultural control involves shaping an organization's culture and norms to encourage individuals to conform to desired behaviours and values. For example an organization promotes a culture of innovation and creativity, encouraging employees to share ideas and experiment with new approaches. They may do this by allowing staff members designated time to work on creative projects. Another example is cultivating a culture of inclusivity and diversity by celebrating festivals and traditions from other countries. The advantage of this form of control is that it creates lasting commitment to desired behaviours and values; of all the types of control mentioned in this essay, this form of control has the longest lasting effect. However changing an existing culture can be challenging and may face resistance from employees accustomed to the status quo. Shaping culture is a long-term endeavour that requires ongoing effort but a positive culture brings many benefits including enhances employee engagement, motivation, and satisfaction.

5) Key Performance Indicators (KPIs):

KPIs are metrics and performance indicators used to evaluate the performance of individuals,teams, or the organization as a whole. For example an e-commerce company sets KPIs for customer satisfaction, measuring it through surveys and feedback ratings. This form of control provides clear targets, ensuring individuals and teams understand expectations. It also allows for data-driven decision making. Leaders can make informed decisions based on performance data, for example on whether a supplier is performing sufficiently to renew the contract with them. The disadvantage to using KPIs as a form of control is that overemphasizing KPIs may lead to a narrow focus on metrics at the expense of broader organizational goals and values. People may also prioritize meeting KPIs over the quality or integrity of their work.

In conclusion, effective leadership requires a nuanced approach to control. Leaders should recognize that different situations and individuals may require varying degrees and types of control. Relying solely on one method, such as direct control or bureaucracy, can limit the organization's adaptability and hinder employee engagement. Instead, a balanced approach that incorporates influencing, cultural shaping, and the use of KPIs can promote a healthy balance between control and autonomy, leading to a more effective and motivated workforce. Ultimately, leaders should use a combination of these control methods to achieve their organizational goals while maintaining a positive and engaged work environment.

Tutor Notes

- I’ve purposed made this question very vague, because sometimes CIPS do make vague questions. Things you should think about when approaching this question are: exercise control over what? (processes?) or over who? (staff?) why do you need control? (is something bad happening?). Because it’s so open, you will need to bring in your own examples into this type of essay. Everyone's essays will look very different for this question.

- Other forms of control mentioned in the study guide include: Self-control – no direct intervention; Trust-control – where trust is high, control reduces (Handy 1993) and Motivation - see the table on p. 189

Evaluation of Autocratic and Affiliative Leadership Approaches (25 Points)

Leadership approaches vary based on organizational needs, culture, and objectives. Below is anin-depth evaluationofAutocratic LeadershipandAffiliative Leadership, focusing on theircharacteristics, advantages, disadvantages, and suitabilityin procurement and supply chain management.

1. Autocratic Leadership (12.5 Points)

Definition and Characteristics

Autocratic leadership is acommand-and-controlapproach where decision-making is centralized, and the leaderexerts full authorityover subordinates. Employees havelittle to no inputin decisions.

Key Features:

The leadermakes all critical decisionswithout consulting the team.

Stricttop-down communicationis followed.

Highly structured and rule-basedmanagement.

Focus onefficiency, discipline, and control.

Suitable forcrisis management, military organizations, and high-risk industries.

Advantages of Autocratic Leadership

✅Quick Decision-Making:

Since decisions are made by one leader, the process is fast and efficient, especially intime-sensitive situationssuch as supply chain disruptions.

✅Clear Chain of Command:

Employees have a clear understanding ofwho is in charge, reducing confusion and ensuring a structured workflow.

✅Improved Accountability:

Withstrict supervision, employees remain focused on their tasks, leading to higher productivity.

✅Effective in Crisis Situations:

In procurement, during a supply chain disruption (e.g., a supplier bankruptcy), a leader must makeimmediate decisionsto secure alternative suppliers.

Disadvantages of Autocratic Leadership

❌Lack of Employee Engagement & Motivation:

Since employeeshave no voice in decision-making, they may feel undervalued, leading tolow morale and high turnover.

❌Reduced Innovation & Creativity:

Employees are not encouraged toshare new ideas or problem-solving approaches, which can limit procurement process improvements.

❌Potential for Micromanagement:

Autocratic leaders tend tooversee every detail, leading toinefficiencyandlack of trustin the team.

Suitability in Procurement & Supply Chain

✅Best suited forhighly regulated industries(e.g., government procurement, defense supply chains).✅Effective inemergency situations(e.g., supplier failure, legal compliance issues).❌Not ideal forcollaborative procurement environmentswhere supplier relationships and teamwork are crucial.

2. Affiliative Leadership (12.5 Points)

Definition and Characteristics

Affiliative leadership is apeople-firstleadership style that prioritizesemployee well-being, relationships, and harmonywithin teams.

Key Features:

Focus onempathy and emotional intelligence.

The leaderbuilds strong team bondsand fosters apositive workplace culture.

Employees are encouraged tocollaborateand voice their opinions.

Suitable for organizations undergoingchange, stress, or morale issues.

Advantages of Affiliative Leadership

✅Boosts Employee Morale and Motivation:

Employees feelvalued and supported, leading tohigher job satisfaction and retention.

✅Encourages Collaboration and Innovation:

Unlike autocratic leadership, an affiliative leaderwelcomes team input, encouraging creative solutions in procurement strategies.

✅Strengthens Supplier Relationships:

In procurement, affiliative leadershipimproves negotiations and long-term supplier partnershipsthroughtrust and open communication.

✅Effective During Organizational Change:

This approachhelps teams adapttonew procurement strategies, digital transformations, or policy changessmoothly.

Disadvantages of Affiliative Leadership

❌Lack of Firm Decision-Making:

Leaders mayavoid conflict or tough decisionsto maintain team harmony, leading toslow decision-making.

❌Risk of Lower Performance Expectations:

Overemphasizing relationshipsmay reduce accountability, leading tounderperformancein procurement teams.

❌Not Suitable for Crisis Management:

In urgent procurement situations (e.g., contract disputes, legal violations), an affiliative leadermay struggle to enforce discipline.

Suitability in Procurement & Supply Chain

✅Best forrelationship-driven roles(e.g., supplier relationship management, collaborative procurement).✅Effective inteam-building and change management(e.g., transitioning to digital procurement systems).❌Not ideal forhigh-risk decision-making environments(e.g., crisis procurement, compliance enforcement).

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Which Leadership Style is Best for Procurement?

For short-term crises, regulatory compliance, or high-risk procurement→Autocratic Leadershipis better.

For long-term supplier management, teamwork, and innovation→Affiliative Leadershipis more effective.

A balanced approach (situational leadership)thatcombines elements of bothstyles is often the most effective strategy in procurement.

This evaluation provides astructured, detailed comparisonthat aligns with CIPS L6M1 exam expectations.

Mark’s Role and Influence in a Cross-Functional Procurement Team

AsHead of ITatSquirrel Incorporated, Mark has been asked to join across-functional teamto evaluate and procure a newIT system. This team includes representatives fromprocurement and finance, meaning each member will have a distinct perspective. Given Mark’stechnical expertise, he can play multiple roles in the decision-making process. This essay exploreskey roles Mark could playand how he caninfluence the outcome of decisions.

Roles Mark Could Play in the Team

1. Technical Expert

Since the procurement involves anIT system, Mark’s primary role is to providetechnical expertiseon system requirements, compatibility, and security.

Responsibilities:

Define thetechnical specificationsfor the new system.

Ensure the system iscompatiblewith existing infrastructure.

Evaluate vendors’technical capabilitiesand cybersecurity compliance.

Influence on Outcome:✔Ensuresonly technically viable solutionsare considered.✔Prevents the company from investing inobsolete or incompatibletechnology.

2. Liaison Between IT and Other Departments

Since procurement and finance teams may not have deeptechnical knowledge, Mark can act as atranslator, ensuring IT needs are understood and integrated into procurement decisions.

Responsibilities:

Explaintechnical jargon in business-friendly terms.

Align IT system selection withbusiness objectives.

Address concerns fromfinance (budget)andprocurement (supplier contracts).

Influence on Outcome:✔Ensures the new system meetsbusiness and IT needs.✔Helps non-technical team members makeinformed decisions.

3. Risk Assessor

IT systems carry risks related tocybersecurity, compliance, and implementation challenges. Mark can lead inrisk assessment and mitigation.

Responsibilities:

Identify potentialsecurity vulnerabilities.

Ensure compliance withdata protection laws (e.g., GDPR, CCPA).

Evaluate risks related tosystem downtime and integration failures.

Influence on Outcome:✔Reduces the risk ofcostly data breaches or compliance violations.✔Helps select vendors withstrong security measures.

4. Change Management Facilitator

Implementing a new IT system requiresuser training and adaptation. Mark cananticipate resistance to changeand help ensuresmooth adoption.

Responsibilities:

Assess potentialuser resistanceand develop atraining plan.

Work withHRanddepartment headsto facilitate smooth transition.

Provide input onuser experience (UX) and ease of use.

Influence on Outcome:✔Increases the likelihood ofsuccessful system adoption.✔Reduces productivity losses due topoor training or resistance.

5. Budget and Cost Advisor

Although finance overseesbudget approvals, Mark can helpjustify IT-related expensesand ensure the team gets thebest valuefor the investment.

Responsibilities:

Identifyhidden costs(e.g., licensing fees, maintenance, upgrades).

Compareon-premise vs. cloud-based solutionsfor cost-effectiveness.

Negotiate with vendors forbest pricing and support packages.

Influence on Outcome:✔Ensureslong-term cost savingsby choosing a scalable, efficient system.✔Preventsoverspending on unnecessary features.

How Mark Can Influence Decision-Making

Mark'stechnical knowledge, risk assessment skills, and financial awarenessgive him significant influence over the team’s decisions. Here’s how he can maximize his impact:

Providing Data-Driven Insights

Usecomparative analysisto show which IT system performs best.

Presentcase studies or industry benchmarksto support recommendations.

Building Consensus Among Team Members

Address concerns ofprocurement (vendor selection) and finance (cost control).

Act as aneutral partybalancing IT needs with business constraints.

Advocating for Long-Term Strategy Over Short-Term Cost Savings

Highlightscalability and future-proofingrather than just upfront costs.

Explain thetotal cost of ownership (TCO), including maintenance and upgrades.

Engaging with Vendors and Negotiating Best Terms

Participate in vendor meetings to ensure IT concerns areproperly addressed.

Suggest contractual terms that provideflexibility and service guarantees.

Conclusion

Mark’s role in this cross-functional team iscriticalto ensuring a successful IT system procurement. By acting as atechnical expert, liaison, risk assessor, change manager, and budget advisor, he can ensure thatbusiness needs, security, and cost-effectivenessare balanced. His ability tocommunicate effectively, present data-driven insights, and align stakeholderswill significantly influence the final decision. Through strategic engagement, Mark can help the teamselect the best IT system that supports Squirrel Incorporated’s long-term success.

Overall explanation

Below you will find how you can plan and draft the essay. Remember this is an example of one way you could approach the question. At Level 6 the questions are much more open so your response may be completely different and that's okay.

Essay Plan

Intro – what is it

P1 – what makes up the informal organisation. Example

P2 – positive

P3 – negative

Conclusion – organisations need to appreciate its existence, harness the positive (communication and helping each other) but mitigate the bad (cliques and rumours).

Example Essay

The "Informal Organization" refers to the unofficial, and often spontaneous network of relationships, interactions, and communication that develop among employees within an organization. It exists alongside the formal structure and hierarchy of the organization, which is usually defined by the organizational chart, job roles, and official reporting relationships. The informal organization, on the other hand, is not documented or officially sanctioned but plays a significant role in shaping the work environment and influencing how work gets done.

The informal organisation is composed of : social networking (informal groups of friends), the Grapevine (informal messages, rumours) and collective values (groups making assumptions – familiarity breeds contempt). An example of this may be employees from different departments who routinely have lunch together and ‘gossip’ about the company. The Informal Organization exists in all types of organisation, regardless of the formal structure and it can have both positive and negative impacts on an organization:

Positive Impact:

Enhanced Communication: Informal networks often facilitate communication and information flow that might be limited within the formal structure. Employees can share ideas, solutions, and concerns more freely, leading to increased innovation and problem-solving.

Rapid Response to Change: Informal groups can adapt quickly to changes in the work environment, helping employees cope with uncertainty and transitions. They can be valuable during times of crisis or when the organization needs to pivot.

Social Support: Informal relationships can provide emotional support and a sense of belonging, reducing workplace stress and improving employee morale and job satisfaction. This can lead to higher retention rates and productivity. This is particularly true when activities or hobbies are included, for example a group of colleagues who create a football league and play after work.

Knowledge Transfer: Informal networks often facilitate the transfer of tacit knowledge (knowledge that is not easily documented) among employees, helping with onboarding, skill development, and organizational learning. For example, a more senior employee telling a new starter that Client A is a hothead so to make sure you answer his emails first.

Problem Resolution: Employees within informal networks may assist each other in resolving work-related issues, leading to quicker problem resolution and improved overall efficiency.

Negative Impact:

Cliques and Exclusivity: Informal groups can sometimes lead to cliques or exclusionary behaviour, which may create a sense of favouritism or inequality. This can negatively impact morale and teamwork. For example if the manager plays in the football league mentioned above he may consciously or unconsciously pick someone else who plays football for a promotion.

Resistance to Change: In some cases, informal groups may resist organizational changes that threaten their established norms or power dynamics, hindering the implementation of necessary reforms.

Gossip and Rumours: Informal communication can lead to the spreading of rumours, misinformation, or negative perceptions, which can harm employee morale and create a culture of distrust.

Conflict and Discord: Informal networks can sometimes breed conflicts and rivalries, which may spill over into the formal organization and disrupt teamwork and productivity. This may be those who play football vs those who don’t.

Lack of Accountability: In the absence of clear reporting structures, the informal organization can undermine accountability, as individuals may not be held responsible for their actions or decisions.

In summary, the informal organization can have a significant impact on an organization, both positive and negative. Understanding and managing these informal dynamics is essential for creating a productive and harmonious work environment. The organisation should foster a culture of inclusivity and diversity to reduce the formation of cliques and utilise informal networks for knowledge sharing and employee engagement initiatives.

Tutor Notes

- The football example is from my own personal experience.  Another example is a split between people who go for a drink after work and those who don't.

- Informal organisations is on p. 250 of the study guide. It came up as a topic in May 22 but that was about how it can impact change, specifically. So you could get a question like the above on pros and cons. Or a question with a case study.

- I love this quote: "Gossip is just the news wearing a tutu." — Barbara Kingsolver. I think it perfectly sums up the informal organisation. It’s communication channels and relationships, just in a tutu.

Overall explanation

Below you will find how you can plan and draft the essay. Remember this is an example of one way you could approach the question. At Level 6 the questions are much more open so your response may be completely different and that's okay.

Essay Plan

Introduction – what is it?

Paragraph 1 – standing

Paragraph 2- integrity

Paragraph 3 – promote

Paragraph 4 – proficiency

paragraph 5 – regulations

Conclusion – it’s super important

Example Essay

The CIPS (Chartered Institute of Procurement & Supply) Code of Conduct serves as a guiding framework for procurement and supply chain professionals to maintain ethical standards and professional integrity in their work. This essay will explore how procurement professionals can apply various aspects of the CIPS Code of Conduct to ensure ethical business practices. It will address each of the five core principles outlined in the Code of Conduct: Standing, Integrity, Promotion, Proficiency, and Regulations, providing relevant examples for each.

Standing:

One of the key principles of the CIPS Code of Conduct is to enhance and protect the standing of the profession. Procurement professionals can apply this by avoiding conduct that would bring the profession or CIPS into disrepute. For example, if a procurement manager discovers evidence of bid rigging among potential suppliers, adhering to this principle would involve promptly reporting the suspicious activity to their organization's compliance department. By doing so, they not only uphold professional standards, but also safeguard the organization's reputation.

Integrity:

Maintaining personal and professional integrity is fundamental to ethical business practices. The Code of Conduct emphasizes that procurement professionals should never engage in conduct, either professional or personal, that would bring the profession or CIPS into disrepute. For instance, if a supply chain manager is offered an extravagant gift by a vendor during negotiations, they should decline the gift and report the offer to their supervisor or compliance department. This action upholds personal and professional integrity, ensuring impartiality in supplier selection.

Promotion:

Procurement professionals can actively promote ethical practices within their organizations and supply chains, aligning with the Code of Conduct. For example, they can advocate for sustainable and ethical sourcing practices. If a procurement manager selects suppliers who adhere to fair labour standards and environmentally responsible practices, they set an example that encourages others to prioritize ethical practices. By actively promoting these principles, they contribute to a culture of integrity and social responsibility.

Proficiency:

Enhancing and protecting the standing of the profession also involves a commitment to proficiency. Procurement professionals can apply this principle by continually developing and maintaining their professional skills and competencies. For instance, attending training programs and industry conferences regularly can help them stay updated on the latest ethical standards and best practices. Pursuing certifications related to ethical sourcing, such as sustainable supply chain management credentials, further demonstrates their commitment to proficiency.

Regulations:

The CIPS Code of Conduct underscores the importance of compliance with relevant laws and regulations in procurement and supply chain management. Procurement professionals should ensure that all sourcing activities align with legal requirements. For example, they can conduct due diligence to confirm that suppliers adhere to anti-corruption laws, trade restrictions, and environmental regulations. This not only minimizes legal and ethical risks but also ensures ethical conduct within the supply chain.

Conclusion:

In conclusion, procurement professionals play a crucial role in maintaining ethical business practices by applying the principles outlined in the CIPS Code of Conduct. By adhering to these principles related to Standing, Integrity, Promotion, Proficiency, and Regulations, they contribute to the ethical and responsible functioning of their organizations and the broader supply chain industry. Upholding ethical standards not only safeguards professional integrity but also fosters trust and transparency in procurement and supply chain management.

Tutor Notes

- The CIPS code of conduct has come up as a 25 point question in Level 4 and Level 5 exams, so there is no reason to believe it couldn’t come up at Level 6. Nothing has changed in terms of content, but at this Level be prepared to give more examples of it being applied in practice.

- Another way this could be asked is in relation to a case study. E.g. Mark is a procurement professional and X and Y are going on at his organisation. Using the CIPS Code of Conduct, what should he do about X and Y?

Overall explanation

Below you will find how you can plan and draft the essay. Remember this is an example of one way you could approach the question. At Level 6 the questions are much more open so your response may be completely different and that's okay.

Essay Plan

Intro – what is an ethical culture?

P1 – create values and principles – put into writing

P2 – Lead by example

P3 – Transparency, whistleblowing

P4 – Decision making

P5 – Laws

P6 – having consequences for failing to follow the culture

Conclusion – culture isn’t static, Banana Ltd needs to constantly update and review

Example Essay

An ethical culture in the workplace refers to the prevailing set of values, norms, principles, and practices within an organization that prioritize and promote ethical behaviour and decision-making among employees and stakeholders. It represents the collective commitment of an organization to conduct its business in a manner that is morally responsible, socially acceptable, and legally compliant. An ethical culture sets the tone for how employees interact with each other, make decisions, and engage with customers, suppliers, and the broader community. Banana Ltd can achieve this in the following ways:

Ethical Values and Principles: An ethical culture is built on a foundation of clear and well-defined ethical values and principles. These values guide employees in their actions and decisions, helping them distinguish between right and wrong. Banana Ltd should engrain these values and principles in writing by creating a vision statement and creating a formal CSR policy detailing expected behaviour from all employees and stakeholders.

Leadership and Accountability: Ethical leaders play a crucial role in fostering an ethical culture. They set an example by consistently demonstrating ethical behaviour and holding themselves accountable for their actions. Leaders also ensure that ethical standards are consistently applied throughout the organization. Therefore the leaders of Banana Ltd should lead by example. This may be in gaining MCIPS qualifications and other certifications that prove their loyalty to ethical issues.

Transparency and Open Communication: Ethical cultures encourage open and transparent communication. Employees are encouraged to speak up about ethical concerns or violations without fear of retaliation. Transparent processes and reporting mechanisms promote accountability. Banana Ltd could implement a Whistleblowing policy for example, so that if any employee knows of areas of concern, they can escalate this to management, without fear of repercussions.

Ethical Decision-Making: Ethical decision-making is central to an ethical culture. Employees are encouraged to consider the ethical implications of their choices, even when faced with challenging decisions that may have financial or competitive implications. For example with Banana Ltd, this may be actively severing ties with suppliers who are known to employ child labour in the mining of rare metals.

Compliance with Laws and Regulations: Ethical cultures emphasize strict adherence to laws and regulations. Banana Ltd should ensure that all activities are carried out within the boundaries of legal requirements, and violations are not tolerated. For example they shouldensure that their HR policies are in line with the Equalities Act. As a large organisation they should also publish a statement about removing Modern Slavery from their supply chain, as per the Modern Slavery Act.

Accountability and Consequences: There are clear consequences for unethical behaviour. Banana Ltd should ensure that accountability mechanisms are in place to address ethical violations, and individuals who breach ethical standards may face disciplinary actions. For example if a supply chain manager is caught accepting an ‘acceleration payment’ or ‘ kickback’ they should be fired.

An ethical culture in the workplace is essential not only for maintaining a positive organizational reputation but also for fostering a healthy, inclusive, and socially responsible work environment. It contributes to employee morale, customer trust, and long-term business sustainability. It is important for Banana Ltd to not only implement this culture, but to maintain it and constantly review it. The area of ethics and sustainability is constantly evolving so Banana Ltd should look to reassess its policies and processes regularly, and continue to strive to achieve more.

Tutor Notes

- You may have guessed that this question was loosely based on Apple. Apple is a good example of ethics and supply chain issues and is worth looking into as it’s an excellent example to bring into an essay on the subject. Here are some links:

- Apple’s Supply Chain Is on a Collision Course With Climate Change (bloomberg.com)

- Apple sees bigger supply problems after strong start to year | Reuters

- Will Supply-Chain Issues Kill the Low-Cost Apple Vision Pro? (pcmag.com)

- Other areas you could have mentioned include: cultures are not static; they are constantly evolving and improving. So Banana Ltd needs to regularly assess and refine their ethical practices to stay aligned with changing societal norms and expectations (I.e. what is ethically acceptable one day, may not be the next). You could have also talked about Banana Ltd's responsibility to the environment and local communities (particularly concerning the mining of metals). Mining is a really bad industry for Child Labour.

Introduction

Leadership is a critical factor in shaping employee performance, motivation, and overall organizational success. In procurement, managers must adopt a leadership style that aligns withtheir team's capabilities, business objectives, and operational challenges. Two widely recognized leadership styles areTransformational LeadershipandTransactional Leadership, each with distinct characteristics and effects on team performance.

This essay will discussboth leadership styles, outlining their advantages and disadvantages. It will then evaluatewhich approach is best suited for Mo, a procurement manager facingskill and confidence issues among his team members.

Understanding Transformational Leadership

Definition

Transformational leadershipis a leadership style that focuses oninspiring, motivating, and developing employeesto reach their full potential. Transformational leaders act asmentors and role models, encouraging innovation, professional growth, and long-term performance improvements.

Key Characteristics of Transformational Leadership

Inspiration and Motivation– The leader encourages employees to perform beyond expectations through a compelling vision.

Individualized Support– Focuses on mentoring and coaching employees to enhance their skills.

Encourages Innovation– Employees are empowered to think creatively and solve problems.

Develops Future Leaders– Focuses on long-term talent development rather than short-term task completion.

High Engagement and Emotional Intelligence– Builds strong relationships with employees and fosters a positive workplace culture.

Advantages of Transformational Leadership

✅Encourages professional growth– Employees develop new skills and gain confidence.✅Increases motivation and job satisfaction– Employees feelvalued and supported.✅Promotes innovation and continuous improvement– Encourages employees tothink creatively.✅Builds long-term organizational success– Createsfuture leadersthrough mentoring and skill development.

Disadvantages of Transformational Leadership

❌Time-consuming– Requiressignificant time and effortfor mentoring and development.❌Not suitable for urgent performance issues– If immediate performance improvement is needed, transformational leadership may betoo slow.❌Employees may resist change– Some employees may beunwilling to embrace coaching and new expectations.

Understanding Transactional Leadership

Definition

Transactional leadershipis a leadership style based on astructured, performance-driven approach. It focuses onclear expectations, rewards for success, and consequences for underperformance. This style is best suited for improvingtask efficiency, enforcing compliance, and ensuring consistency.

Key Characteristics of Transactional Leadership

Clear Expectations and Rules– Employees have defined roles and responsibilities.

Performance-Based Rewards and Punishments– Good performance is rewarded, while poor performance is corrected through disciplinary actions.

Focus on Efficiency and Results– Emphasizes productivity and operational efficiency over employee growth.

Short-Term Performance Goals– Ensures immediate improvements in employeeperformance.

Hierarchy and Structure– Follows a strict chain of command.

Advantages of Transactional Leadership

✅Ensures short-term efficiency and compliance– Clearly defines expectations, which leads toimmediate improvementsin performance.✅Effective for structured tasks– Employees know exactly what is expected, reducing uncertainty.✅Increases accountability– Employees areheld responsible for meeting targets.✅Useful for crisis management– Provides aclear directivein high-pressure situations.

Disadvantages of Transactional Leadership

❌Limited employee development– Focuses more ontask completionrather than skill enhancement.❌Can reduce creativity and innovation– Employees may feel restricted by rigid expectations.❌May reduce motivation– Over-reliance on rules and punishments can createa negative work environment.❌Not ideal for building long-term talent– Employees may notdevelop leadership skills or confidence.

Which Leadership Style is Most Suitable for Mo?

Case Study Analysis: Mo’s Leadership Challenge

Mo is aprocurement managerleading a team of5 procurement assistants.

Theassistants are underperformingdue tolack of skills and confidence.

Mo isconcerned about their abilityto complete procurement tenders accurately.

Evaluating the Best Leadership Approach for Mo

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Based on thespecific challengesMo is facing,neither leadership style alone is perfect. Instead, acombined approachismost suitable:

Recommended Approach: A Blend of Transformational and Transactional Leadership

Short-Term Approach: Transactional Leadership for Immediate Performance Improvement

Mo shouldset clear expectations and enforce accountabilityto ensure the assistantsimprove their performance in procurement tenders.

Implement astructured training programwith performance benchmarks.

Useperformance-based incentives(e.g., bonuses, recognition for accurate work).

Provideconstructive feedbackon mistakes to encourage learning.

Long-Term Approach: Transformational Leadership for Skill Development and Confidence

Mo should act as amentor and coach, providingcontinuous learning opportunities.

Encourage assistants todevelop confidencein procurement byassigning them progressively challenging tasks.

Inspire the team byhighlighting the importance of procurement excellencein achieving organizational goals.

Implementpeer learning and mentorship programsto create a supportive learning environment.

Conclusion

BothTransformational LeadershipandTransactional Leadershipoffervaluable benefits, but in the case of Mo’sunderperforming team, ablended approach is the most effective strategy.

Transactional Leadership should be used in the short termtoimprove immediate performance, enforce accountability, and ensure accuracy in procurement tenders.

Transformational Leadership should be introduced graduallytodevelop skills, boost confidence, and foster long-term career growthamong the procurement assistants.

Bycombining both approaches, Mo canquickly improve his team’s performance while ensuring they gain the necessary skills and confidence to succeed in procurement. Thisbalanced leadership approachensuresshort-term efficiency and long-term growth, making it the most effective strategy for Mo's situation.

Introduction

Leadership effectiveness depends on how well a leader adapts to changing situations, team capabilities, and organizational needs.Situational Leadership, developed byPaul Hersey and Ken Blanchard, is aflexible leadership modelthat suggestsno single leadership style is best in all situations. Instead, leaders mustadapt their approachbased on thematurity, competence, and motivation of their team members.

In thecontext of supply chain management, where conditions are constantly evolving due tomarket dynamics, supplier relationships, technological changes, and risk factors, situational leadership is ahighly relevant approach.

1. What is Situational Leadership? (5 Points)

Definition

Situational Leadershipis acontingency-based leadership modelthat suggests leaders shouldadjust their leadership style based on the specific situationand thereadiness level of their team members.

Key Concept: Leadership Styles Based on Team Readiness

TheSituational Leadership Modelidentifiesfour leadership styles, which are determined by a combination ofdirective (task-oriented) and supportive (relationship-oriented) behaviors:

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Why Situational Leadership is Important?

Encouragesflexibilityin leadership.

Helpsdevelop employees’ skills and confidence.

Ensureseffective leadership in changing environmentslike supply chain management.

2. How Situational Leadership Applies to Supply Chain Management (20 Points)

Supply Chain Management Overview

Supply chain management (SCM) involvesplanning, procurement, logistics, inventory management, risk assessment, and supplier relationships. Given thefast-changing nature of supply chains, managers mustadapt their leadership stylebased onteam capabilities, supplier maturity, and operational challenges.

Situational Leadership Applied to Supply Chain Functions

1. Telling (S1) – Directive Leadership for New or Inexperienced Teams

🔹Application in Supply Chain:

Best fornew supply chain employeeswho needstrict guidanceon procurement, contract management, and compliance.

Works well instructured environments, such aswarehouse management and logistics operations, wherestandard operating procedures (SOPs) must be followed.

🔹Example:Anewly hired procurement officerstruggling withcontract negotiationmay needstep-by-step instructionsfrom a senior manager to ensure compliance with procurement regulations.

2. Selling (S2) – Coaching Approach for Semi-Skilled Supply Chain Teams

🔹Application in Supply Chain:

Used when employeeshave some knowledge but need motivation and guidance.

Effective insupplier relationship management, where procurement staffneed training on negotiation techniques and ethical sourcing.

Helps employeesunderstand the bigger pictureandimprove decision-making skills.

🔹Example:A procurement teamtransitioning to a digital procurement systemmay needtraining, encouragement, and strategic directionto adopt new technologies.

3. Participating (S3) – Collaboration in Strategic Supply Chain Decisions

🔹Application in Supply Chain:

Works best forexperienced supply chain professionalswho needempowerment and involvement in decision-making.

Encouragesteam input on strategic decisions, such asrisk management, cost optimization, and sustainability initiatives.

Best forcross-functional collaboration, whereprocurement, logistics, and finance teams work together.

🔹Example:A supply chain manager engaging with senior procurement professionalsto co-develop a supplier diversification strategyto reduce dependency on a single supplier.

4. Delegating (S4) – Empowering High-Performing Supply Chain Teams

🔹Application in Supply Chain:

Best forhighly experienced and autonomous supply chain professionalswho requireminimal supervision.

Used inglobal supply chain operations, whereregional managers handle logistics, procurement, and supplier engagement independently.

Encouragesinnovation, allowing supply chain teams tooptimize processes using AI, automation, and data analytics.

🔹Example:Asenior procurement manager overseeing global supplier contractsoperates withfull autonomyandimplements a digital supplier performance dashboardwithout needing daily oversight.

3. Advantages and Challenges of Situational Leadership in SCM

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Conclusion

Situational leadership is ahighly effective approach for supply chain management, wheredynamic conditions require flexible leadership styles. Byadjusting leadership approachesbased on team competency, motivation, and operational needs,supply chain leaders can optimize procurement, logistics, and supplier relationship management.

Themost effective supply chain leaders use all four styles, applying:

Telling (S1) for new procurement staff,

Selling (S2) for skill-building in supplier management,

Participating (S3) for strategic decision-making, and

Delegating (S4) for experienced global supply chain teams.

Bymastering situational leadership, procurement and supply chain managers canincreaseefficiency, reduce risks, and improve supplier partnerships, ultimately enhancingorganizational success.