L6M1 Strategic Ethical Leadership V 3.0 CD

Strategic Ethical Leadership L6M1
Study Pass Notes
Version 3.0 © YPTC
not for re-sale or distribution

Module purpose
On completion of this module, learners will be able to critically evaluate leadership skills and
behaviours required to achieve organisational and stakeholder commitment to strategic
improvements and change and also appreciate ethical practices, standards and regulations
that impact on the procurement and supply function.
Module aim(s)
Globalisation and the ever changing markets in which organisations operate require effective
leaders who are able to think and act in a strategic manner. This is particularly true for those
who lead the procurement and supply function ensuring that it makes a positive contribution
to overall organisational success. Strategic Leadership is the ability to make and
communicate decisions that enhance the prospects for the organisation’s long-term success
while maintaining long-term financial stability. This module is designed for those
professionals who are expected to deliver effective and efficient procurement and supply. It
emphasises the leadership skills and behaviours required for the achievement of the
objectives and improvements sought by the organisation.
not for re-sale or distribution ©YPTC

Learning outcomes, assessment criteria and indicative content
1.0 Understand and apply leadership skills and behaviours that are appropriate for
strategically improving the procurement and supply chain function
1.1 Critically evaluate the differences between leadership and management
• Defining leadership
• The role of a leader and the activity of leadership
• The importance of leadership
• The differences between management and leadership
• Situational leadership
• The continuum of leadership behaviour
• The forces in deciding the type of leadership
• Transformational and inspirational leadership
1.2 Critically analyse approaches to leadership for improving procurement and supply
chain management
• The qualities or traits approach to leadership
• The functional or group approach, including action centred leadership
• Styles of leadership including the authoritarian or autocratic, democratic and

laissez-faire styles
• Contingency theories for leadership such as path goal theory
2.0 Understand and apply communication planning techniques and analyse their
influence on individuals involved in the supply chain
2.1 Evaluate influencing styles that can be used in the effective leadership of a supply
chain
• Implementing a vision of improved procurement and supply chain

management
• Models for managing in four different directions
• The relevance of managing upwards and across to achieve desired results for
improved supply chain management
• The merits of escalation as a means of influencing
• A range of influencing styles for cross functional leadership both within and
outside the bounds of formal teams

2.2 Compare leadership techniques that can be used to influence personnel involved
in a supply chain
• Assessing the readiness of followers or groups
• Leaders attitudes to people
• Management by objectives and establishing KPIs
• Measures of effectiveness
• Self-development
• Emotional intelligence
2.3 Evaluate how to create a communication plan to influence personnel in the supply
chain
• Stakeholder analysis including primary, secondary and key stakeholder
• How to obtain buy in to supply chain strategies from stakeholders
• Perspectives on stakeholder mapping
• How the use of the intranet and Internet websites for publishing information
3.0 Understand and apply methods to overcome leadership challenges faced by

procurement and supply chain managers
3.1 Contrast the sources of power and how they can be used to overcome common
challenges faced by procurement and supply chain leaders
• Perspectives on individual power
• Processual, institutional and organisational levels of power
• Perspectives on organisational power
• The balance between order and flexibility
3.2 Analyse how equality and diversity issues relating to the supply chain can be used
to improve strategic effectiveness
• Defining diversity, equality and inclusion
• The benefits of diversity in organisations
• The impact of discrimination, harassment and victimisation
• Developing and implementing policies to enhance diversity

3.3 Evaluate methods of change management that can be used to develop the supply
chain
• The nature of organisational change
• Planned organisational change
• Dealing with resistance to change
• Effective change management
3.4 Assess methods for resolving conflict with internal and external stakeholders to
support change in the supply chain
• Contingency models of organisations
• The functions of the informal organisation
• The positive and negative outcomes of conflict
• Strategies for resolving conflict
• Incremental and transformational change
4.0 Understand and apply ethical practices, standards and regulations that impact on
the procurement and supply function
4.1 Examine ethical practices and standards that apply to global supply chains
• Ethical codes of practice
• Due diligence on suppliers
• Contractual clauses
• Leading ethical practices and standards
• Developing a culture of commitment to achieve ethical codes and practices
• Initiatives and policies created by leading bodies such as:
• CIPS Code of Conduct
• Traidcraft
• The Walk Free Foundation
• UN
• ILO
4.2 Assess regulations that impact on the ethical employment of people
Regulations such as:

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• Discrimination, equality and diversity
• Employee redundancy and dismissal
• Working time and staff payment
• International labour codes
• Health and safety at work
• Minimum/fair wages

Learning outcomes, assessment criteria and indicative content
1.0 Understand and apply leadership skills and behaviours that are appropriate for
strategically improving the procurement and supply chain function
1.1 Critically evaluate the differences between leadership and management
• The forces in deciding the type of leadership
Warren Bennis and Burt Nanus state,
“Managers are people who do things right and leaders are people who do the right thing.”
According to Kotter, management is about planning, controlling, and putting appropriate
structures and systems in place, whereas leadership has more to do with anticipating change,
coping with change, and adopting a visionary stance.

Mintzberg’s managerial roles
NATURE OF ROLE ROLE DEFINITION
Interpersonal • Figurehead
Arising from a manager’s formal authority or position • Leader
in the organisation and unit • Liaison
Informational • Monitor
Arising from a manager’s access to internal and • Spokesperson
external contacts • Disseminator
Decisional • Entrepreneur
Arising from a manager’s formal authority and access • Disturbance handler
to information, which places him in the best position • Resource allocator
to solve problems relating to the unit or department as • Negotiator
a whole
Leadership roles and activities

 Creating a sense of direction, or finding a vision for something new
 Communicating the vision, in a credible and compelling way
 Energising, inspiring and motivating people, to translate the vision into achievement
 Developing people, to enhance the long-term capability of the organisation
 Creating, articulating, maintaining or changing organisational culture and values
Leadership focus in procurement

 Formulating procurement, supply chain and sourcing strategy and aligning it with
corporate strategy

 Integrating procurement activity within the organisation (and, increasingly, the wider
supply chain)
 Network leadership: drawing together and giving direction to multi-functional and
multi-organisational ‘teams’; creating and managing partnerships
 Securing internal and external stakeholder buy-in to procurement plans, initiatives
and projects
 Establishing and applying meaningful key performance indicators for procurement
and supply chain activity
 Ethical leadership, via procurement’s input to environmental and social sustainability
and CSR goals
Influencing corporate culture
Leadership has a crucial role in the creation, shaping, maintenance (and changing) of
corporate culture
 Acting as exemplars and role models for the values and behavioural expectations and
norms of the culture
 Encouraging examination and expression (and where necessary, challenging) of
underlying assumptions and paradigms
 Expressing the values and beliefs of the culture, through a wide range of leadership
communications
 Encouraging team members (and suppliers) to ‘own’ desirable values, beliefs and
behaviours
 Using human resource management mechanisms or supplier management
mechanisms to reinforce desirable changes
Supply chain leadership
 Motivating and inspiring supply chain partners to offer above-compliance levels of
service, innovation, support and value addition
 Utilising motivational and relationship-maintaining influencing approaches to change
perceptions, attitudes and behaviours
 Mobilising and developing resources and capabilities within the supply chain in
support of development and improvement
 Introducing changes in a constructive, supportive, relationship-maintaining and –
where possible – collaborative manner
 Facilitating collaboration and alliance-building between stakeholders in the supply
network
 Leading by example in desired standards of conduct and performance
 Utilising influence to encourage the raising of standards in the supply chain
The importance of leadership
 Leaders energise and support change, flexibility and adaptation
 Leaders secure commitment
 Leaders set direction
 Leaders support, challenge and develop people
 Leaders use a facilitate-empower style rather than a command-control style
 As an explicitly interpersonal process, based on qualities such as interpersonal
sensitivity, rapport and emotional intelligence, leadership supports relationship
and trust building
 Leaders use influence, rather than positional, structural or hierarchical power
Supporting supply chain innovation
 Motivating and inspiring people to ‘think outside the box’ or ‘transcend the
ordinary’
 Designing and developing an organisational environment which enables people
to be innovative
 Creating structures which facilitate multi-directional and cross-functional
communication, synergies and the use of initiative
 Creating an organisational climate which is open to new ideas, criticisms,
problem identification and feedback
 Developing innovation-relevant skills and capabilities in people and teams
 Mobilising organisational resources to support innovation
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Leading is about deciding direction, coming from an Anglo-Saxon word
meaning the road or path ahead; knowing the next step and then taking
others with you to it.
Managing is a later concept, from Latin 'manus', meaning hand, and more
associated with handling a system or machine of some kind.
What is the difference between management and leadership?- Kotter

Management makes systems of people and technology work well day after day, week after
week, year after year.
•Planning and budgeting
•Organizing and staffing
•Controlling and problem solving
•Taking complex systems of people and technology and making them run efficiently and
effectively, hour after hour, day after day
Leadership creates the systems that managers Leaders v managers 2m 03s
manage and changes them in fundamental ways to
take advantage of opportunities and to avoid
hazards https://www.youtube.com/watch?
•Creating vision and strategy v=wVTTBXlAGvI
•Communicating and setting direction https://youtu.be/wVTTBXlAGvI
•Motivating action
•Aligning people
•Creating systems that managers can
manage and transforming them when needed to allow for growth, evolution,
opportunities, and hazard avoidance
http://www.kotterinternational.com/our-principles/change-leadership
Today’s groups, organizations, and

teams need both effective leaders and
effective managers to run a successful
operation. While some obvious
similarities (i.e. they both involve
influencing constituents or employees;
authority and power are generally given
with both positions) can be found
between leadership and management,
there are also some striking differences
(i.e. management is often more task-
oriented; leadership is often considered
more inspirational and visionary). Still
there is an overlap between the two
fields; when managers are involved in
influencing a group of employees to
meets its goals, they are operating
under leadership. In addition, when
leaders are involved in aspects such as
planning, organizing, staffing or
controlling, they are operating within
management. So … distinguishing
between leadership and management, suffice it to say that while different, they may never be
completely separate.
One important point that John Kotter makes is that “Leadership and management are two
distinctive and complementary systems of action…… Both are necessary for success in an
increasingly complex and volatile business environment.” The fact is that leadership and
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management are both important, they are two distinctive systems of action, both are
necessary as each seek to do different things.
A major variable in the style of leadership adopted by the manager is the nature of
subordinate staff. This view is developed by Hersey and Blanchard who present a form of
situational leadership based on the ‘readiness’ level of the people the leader is attempting to
influence. Readiness is the extent to which followers have the ability and willingness to
accomplish a specific task. It is not a personal characteristic of the individual, but how ready
the individual is to perform a particular task.
The theory states that instead of using just one style, successful leaders should change their
leadership styles based on the maturity of the people they're leading and the details of the
task. Using this theory, leaders should be able to place more or less emphasis on the task,
and more or less emphasis on the relationships with the people they're leading, depending
on what's needed to get the job done successfully.
This model is based on the amount of direction (task behaviour) and the amount of
socioemotional support (relationship behaviour) a leader must provide given the situation and
the level of “readiness” of the follower or group.
The recognition of task and relationship as two critical dimensions of a manager’s behaviour
has been an important part of management research over the last several decades. These
two dimensions have been given various labels ranging from “autocratic” and “democratic” to
“employee oriented” and “production oriented”
For some time, it was believed that task and relationship behaviours were either/or styles of
leadership and, therefore, could be represented by a single continuum, moving from very
authoritarian leader behaviour (task) at one end to very participative leader behaviour
(relationship) at the other end.
In more recent years, the idea that task and relationship behaviours were either/or leadership
styles has been dispelled.
By spending time actually observing the behaviour of leaders in a wide variety of situations,
the Ohio State staff found that they would classify most of the activities of leaders into two
distinct and different behavioural categories or dimensions. They named these two
dimensions “Initiating Structure” (task behavior) and “Consideration” (relationship behaviour).
These two dimensions can be defined in the following way:
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Task behaviour is the extent to which a leader engages in one way communication by
explaining what each follower is to do as well as when, where and how tasks are to be
accomplished.
Relationship behaviour is the extent to which a leader engages in two-way communication
by providing socioemotional support, “psychological strokes” and facilitating behaviours.
Level of Readiness
Situational Leadership defines readiness as the ability and willingness or a person to take
responsibility for directing their own behaviour. These variables of readiness should be
considered only in relation to a specific task to be performed. That is to say, an individual
(or a group) is not at a level of readiness in any total sense. People tend to have vary degrees
or readiness depending on the specific task, function or objective that a leader is attempting
to accomplish through their efforts.
According to Situational Leadership, as the level of readiness of a follower continues to
increase in terms of accomplishing a specific task, the leader should begin to reduce task
behaviour and increase relationship behaviour. This should be the case until the individual or
group reaches a moderate level or readiness, it becomes appropriate for the leader to
decrease not only task behaviour but relationship behaviour as well. Now the follower is not
only ready in terms of the performance of the task but is also confident and committed.
Thus, Situational Leadership focuses on the appropriateness or effectiveness of leadership
styles according to the task-relevant readiness of the follower. This cycle can be illustrated by
a bell-shaped curve superimposed on the four leadership quadrants .
Dr. Paul Hersey - Situational Leadership 4m 18s
https://www.youtube.com/watch?v=lIPK9APaBnk
https://youtu.be/lIPK9APaBnk
OPD4835 - Situational Leadership 4m 14

https://www.youtube.com/watch?v=sGCxEP8R6MQ
https://youtu.be/sGCxEP8R6MQ
According to Hersey and Blanchard, there are four main leadership styles:
1. Telling (S1) – Leaders tell their people what to do and how to do it.
2. Selling (S2) – Leaders provide information and direction, but there's more
communication with followers. Leaders "sell" their message to get people on board.
3. Participating (S3) – Leaders focus more on the relationship and less on direction. The
leader works with the team, and shares decision-making responsibilities.
4. Delegating (S4) – Leaders pass most of the responsibility onto the follower or group.
The leaders still monitor progress, but they're less involved in decisions.
As you can see, styles S1 and S2 are focused on getting the task done. Styles S3 and S4 are
more concerned with developing team members' abilities to work independently.
Maturity Levels
According to Hersey and Blanchard, knowing when to use each style is largely dependent on
the maturity of the person or group you're leading. They break maturity down into four
different levels:
1. M1 – People at this level of maturity are at the bottom level of the scale. They lack the
knowledge, skills, or confidence to work on their own, and they often need to be
pushed to take the task on.
2. M2 – at this level, followers might be willing to work on the task, but they still don't
have the skills to complete it successfully.
3. M3 – Here, followers are ready and willing to help with the task. They have more
skills than the M2 group, but they're still not confident in their abilities.
4. M4 – These followers are able to work on their own. They have high confidence and
strong skills, and they're committed to the task
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In attempting to improve the readiness of a follower who has not taken much responsibility in
the past, a leader must be careful not to increase socioemotional support (relationship
behaviour) too rapidly. If this is done, the follower may view the leader as becoming a “soft
touch.” Thus, the leader must develop the follower slowly, using a little less task behaviour
and a little more relationship behaviour as the follower increases in readiness. When an
individual’s performance is low, one cannot expect drastic changes overnight. For more
desirable behaviour to be obtained, a leader must reward as quickly as possible the slightest
appropriate behaviour exhibited by the individual in the desired direction. This process
continues as the individual’s behaviour comes closer and closer to the leader’s expectations
of good performance.
Key Points
All teams, and all team members, aren't created equal. Hersey and Blanchard argue that
leaders are more effective when they use a leadership style based on the individuals or
groups they're leading.
Start by identifying whom you're leading. Are your followers knowledgeable about the task?
Are they willing and excited to do the work? Rate them on the M1 - M4 maturity scale, and
then use the leadership style that's appropriate for that rating.
Contingency theorists Tannenbaum and Schmidt suggested the idea that leadership
behaviour varies along a continuum and that as one moves away from the autocratic extreme
the amount of subordinate participation and involvement indecision taking increases. They
also suggested that the kind of leadership represented by the democratic extreme of the
continuum will be rarely encountered in formal organisations.
Tannenbaum and Schmidt identify a continuum of leadership styles in decision-making, based
on:
 the degree of authority used by the manager;
 the area of freedom available to the non-manager.
The Tannenbaum and Schmidt continuum can be related to McGregor’s supposition of Theory
X and Theory Y. Boss-centred leadership is towards Theory X and subordinate-centred
leadership is towards Theory Y.
Moving along the continuum, the manager may be characterised according to the degree of
control that is maintained. Neither extreme of the continuum is absolute as there is always
some limitation on authority and on freedom. This approach can be seen as identifying four
main styles of leadership by the manager: tells, sells, consults, joins(shares & delegates)
Here are the 7 different leadership approaches, starting with the far left end of the spectrum.
Leadership Styles: Tannenbaum & Schmidt

Continuum 3 m 35s 12
not for re-sale or distribution ©YPTC https://www.youtube.com/watch?v=xFYHLbUZZ9A

https://youtu.be/xFYHLbUZZ9A
1. Telling- Manager makes decision and announces it
This approach is typified when a leader says: "The problem I face is.. I want you to..."
This is the autocratic style of leadership. While unfashionable today, it is often needed
when teams are new, inexperienced, or weak. As the team gain in cohesion and
commitment, it becomes less and less appropriate.
An autocratic style in which the leader gives specific instructions and monitors staff
closely is most useful when the team cannot tackle the task unaided, is unwilling, new
or suffered a previous leader who allowed standards to deteriorate. It is the style most
people accept in a crisis.
For this style to work well leaders/managers need to:
-Be clear and precise about standards, performance targets and expectations
-Give detailed instructions
-Monitor key performance indicators closely
-Use frequent feedback to modify behaviour
-Help people over learning problems while being firm about standards.
2. Selling - Manager makes decision and then "sells" decision
This approach is typified when a leader says: "The problem I face is.. I want you to...
because..." In the selling approach, it's still the leader in the driving seat but there is
the need to get others to understand why they are doing what he or she wants.
A persuasive style, in which the leader gives clear direction and supervises closely
but also explains decisions, encourages suggestions and supports progress. It is
most useful when motivation is lacking.
For this style to work leaders/managers need to:
-Develop team skills, monitoring how those skills are implemented;
-Spend time with each individual addressing standards, skills and motivation;
-Monitor closely and be directive to keep performance to agreed standards;
-Listen to the team's feelings but stand your ground in relation to the goal;
-Reward positive behaviour.
3. Consulting - Manager presents ideas and invites questions. Manager presents tentative
decision subject to change. Manager presents problem, get suggestions, makes decision
This approach is typified when a leader says: "The problem I face is.. I want you to... What do
you think...?" Notice now how the leader explains the problem, comes up with an idea but
checks it out with the team. If they're not ready for more responsibility, they'll go along with
what the boss wants; if they are ready, then he or she leaves the door open for them to
discuss their thoughts.
This is a collaborative style in which the leader discusses the task and listens to the
team's ideas, taking them into account as he or she makes the key decisions. It is
most useful when the team has sufficient skills and competence to make a
contribution but where the leader feels a need to retain control.
For this style to work leaders/managers need to:
-Focus on morale and team spirit;
-Encourage participation, straight comment and feedback.
-Specify objectives but let the team discuss how to achieve them;
-Explain fully, and encourage 'buy-in' to major decisions while minimising directives
and suggestions from yourself, except in exceptional circumstances
4. The Leader Consults. This approach is typified when a leader says: "The problem we face
is.. What ideas do you have for solving it...?" Notice now how the leader drops the word "I" in
exchange for the word "we". Notice also how he or she no longer feels the need to have an
answer ready. The leader is effectively inviting the team to problem-solve with him or her.
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5. The Leader Joins. This approach is typified when a leader says: "What is the problem we
face? How can we solve it? Any ideas?" Now comes a turning-point. The leader no longer
owns the problem and solution alone. By asking the team to consider the problem as well as
the solution, he or she is nudging them into outright ownership themselves.
6. The Leader Delegates. This approach is typified when a leader says: "Problems keep
cropping up... Can you see what's going on, come up with some ideas and get back to me..."
Now the leader knows that there are problems in certain areas of the job but, in moving from
the word "we" to the word "you", gives the team the green light to find answers. The decision
may still be the leader's but the team can have a high level of influence over the final
outcome.
7. The Leader Abdicates. This approach is typified when a leader says: "Sort out any
problems that crop up. I'm here if you need me but only if you really need me." Here the
language of the leader is coded. What he or she is really saying to the team is that they have
full responsibility for identifying, analysing, and resolving the problem but accountability still
rests with the leader.
How to Use the Tannenbaum and Schmidt Continuum
Tannenbaum and Schmidt's 7 levels of control and freedom correspond broadly to a team's
level of development. When a team is immature, ie unmotivated and unskilled, the styles will
be on the left-hand side of the spectrum. When a team is motivated and skilled, the styles
will be on the right. Tannenbaum and Schmidt thought that there were two other factors to be
taken into account when selecting a style. One was the demands of the situation. For
example, is the problem urgent or high-risk? Does the organisation's culture allow for
delegating styles? The other issue was whether the leader has the skills and willingness to
manage a full range of styles across the spectrum.
• The main forces in deciding the type of leadership

According to Tannenbaum and Schmidt, if one has to make a choice of the
leadership style which is practicable and desirable, then the answer will
depend upon the following three factors:
1 Forces in the manager. The manager’s behaviour will be influenced by their own
personalities, backgrounds, knowledge and experiences. These internal forces will include:
■ value systems;
■ confidence in subordinates;
■ leadership inclinations; and
■ feelings of security in an uncertain situation.
2 Forces in the subordinate. Subordinates are influenced by many personality variables and
their individual set of expectations about their relationship with the manager. Characteristics
of the subordinate are:
■ the strength of the needs for independence;
■ the readiness to assume responsibility for decision-making;
■ the degree of tolerance for ambiguity;
■ interest in the problem and feelings as to its importance;
3 Forces in the situation. The manager’s behaviour will be influenced by the general
situation and environmental pressures. Characteristics in the situation include:
■ type of organisation;
■ group effectiveness;
■ nature of the problem; and
■ pressure of time.
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Tannenbaum and Schmidt conclude that successful leaders are keenly aware of those forces
which are most relevant to their behaviour at a particular time. They are able to behave
appropriately in terms of their understanding of themselves, the individuals and the group, the
organisation, and environmental influences. Successful managers are both perceptive and
flexible. Forces lying outside the organisation are also included. Recognition is given to the
possibility of the manager and/or subordinates taking initiatives to change the boundaries of
the rectangle through interaction with external forces. Recognition is also given to the power
available to all parties in the organisation (for example individual workers and trade unions)
and to the factors which underlie decisions on the use of power by the manager.
Transformational leadership and inspirational may as very similar- often describing one or the
other can use the same theory/models. Some writers though suggest a slight difference!
Another way of looking at leadership approaches is to do with the type of work and the
relationship between the leader and the follower.
Transformational leadership is a process in which the leaders take actions to try to increase
their associates' awareness of what is right and important, to raise their associates'
motivational maturity and to move their associates to go beyond the associates' own self-
interests for the good of the group, the organization, or society. Such leaders provide their
Transformational- cartoon 2m 24s

http://www.youtube.com/watch?v=60O2OH7mHys
Leadership Styles: Which Type of Leader Are You? 2m 49s
https://www.youtube.com/watch?v=ddt_IGMMOrI
https://youtu.be/ddt_IGMMOrI
Transactional vs. Transformational Leadership Theory 3 m 6s
https://youtu.be/eQ5vhPowj_0
associates with a sense of purpose that goes beyond a simple exchange of rewards for effort
provided. The transformational leaders are proactive in many different and unique ways.
These leaders attempt to optimize development, not just performance. Development
encompasses the maturation of ability, motivation, attitudes, and values. Such leaders want to
elevate the maturity level of the needs of their associates(from security needs to needs for
achievement and self-development). They convince their associates to strive for a higher level
of achievement as well as higher levels of moral and ethical standards.
 A process of engendering higher levels of motivation & commitment among followers
 Emphasis is on generating a vision for the organisation, the leader’s ability to appeal
to higher ideals & values of followers, & creating a feeling of justice, loyalty & trust
 Is about transforming the performance
Transactional leadership -Burns 1978
This approach emphasises the importance of the relationship between leader and followers,
focusing on the mutual benefits derived from a form of 'contract' through which the leader
delivers such things as rewards or recognition in return for the commitment or loyalty of the
followers:
 Based on legitimate authority within the bureaucratic structure of an organisation

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 Emphasis on the clarification of goals & objectives, work tasks & outcomes,
organisational rewards & punishments
 Appeals to the self-interest of followers
 Based on a relationship of mutual dependence & an exchange process of ‘I will give

you this, if you
Bass described three major characteristics of the transformational leader as follows:
 Charisma. The force of the leader's personality and interpersonal skills have an
extraordinary effect on their followers, without resorting to using any formal authority.
They use determination, energy, self-confidence and ability to inspire and excite people to
believe that together they can achieve great things.
 Intellectual stimulation. The transformational leader is able to show followers new ways
of looking at things. The leader then emphasises that any difficulties can be overcome
through rational thought and planning.
 Consideration of each follower's emotional needs. Each follower has specific abilities,
skills and emotional needs such as needs for recognition, achievement and esteem. The
leader acts as a coach and is willing to delegate tasks to encourage followers.
Mullins notes that transformational leadership is often strongly identified with 'charismatic',
'visionary' or 'inspirational' leadership. 'Successful transformational leaders are usually
identified in terms of providing a strong vision and sense of mission, arousing strong emotions
in followers and a sense of identification with the leader.' When you think of great visionary
and charismatic leaders, they are probably transformational. Examples might include Winston
Churchill, Martin Luther King, Nelson Mandela and Richard Branson.
Inspirational Leadership - Bass & Bruce 1994 & the FOUR I’s Bass proposed that
transformational leadership is composed of four dimensions (i.e. “Four Is”): idealized
influence, individualized consideration, intellectual stimulation, and inspirational motivation.
Based on the personal qualities or charisma of the leader and the manner in which the
leadership influence is exercised.
1. Idealised influence = Charisma Bass argues that charisma is one component

of transformational leadership, but just one component and by itself would not
be sufficient
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The leader wins the respect, trust and emulation of the team, by acting as a role
model in the kinds of values he wishes to foster in the team.
Inspirational motivation
The leader generates a greater awareness of the value of organisational purposes

and team contribution.
2. Intellectual stimulation
The leader supports learning and creative problem-solving; questions assumptions;

encourages new thinking and innovation; supports people in stretching themselves.
3. Individualised consideration
The leader treats team members as individuals; listens to them; supports their
personal growth and development; appreciates difference and diversity; creates
development opportunities by delegating and acting as a coach or mentor; and
avoids micro-managing performance.
A truly inspirational leader
 Understands the spirit within
 Connects with the led, appreciates the capabilities of others, and through trust
unlocks the powers in others
 Recognises & seizes the brief window of opportunity that acts as a powerful
catalyst, inspiring the leader & the led
Adair
Mullins also notes that it is possible to distinguish inspirational or visionary leadership

from transformational leadership, by their specific focus on the skills of motivating and
inspiring people. Inspirational leadership generally includes some combination of:
 Vision articulation
 Charisma or personal 'magnetism' and power to inspire.
House (1976) argued that charisma can be learned or developed:
 Role modelling: setting an example, and consistently representing and demonstrating

values which are positive and attractive for followers
 Confidence building: encouraging, giving positive feedback, communicating high
expectations of followers, and expressing and demonstrating confidence in their
ability
 Goal articulation: setting out clear goals for the team, in a way that is compelling to
followers
 Motive arousal: inspiring followers with the desire or confidence to pursue the goals
 Critique of charismatic leadership
 Creates dependence among followers which may make them open to deception.
 Encourages emulation, which may be damaging for the organisation.
 Leader may be non-rational and prone to fashions and fads.
 May encourage unrealistic ambitions for the organisation.
17

1.2 Critically analyse approaches to leadership for improving procurement and supply
chain management
• The qualities or traits approach to leadership
• The functional or group approach, including action centred leadership
• Styles of leadership including the authoritarian or autocratic, democratic

and laissez-faire styles
• Contingency theories for leadership such as path goal theory
-----------------------------------------------
• The qualities (great man theory) or traits approach to leadership
The first approach assumes that leaders are born and not made. Leadership consists of
certain inherited characteristics, or personality traits, which distinguish leaders from their
followers: the so-called Great Person theory of leadership. The qualities approach focuses
attention on the man or woman in the job and not on the job itself. It suggests that attention is
given to the selection of leaders rather than to training for leadership. Assumes that leaders
are born and not made
Inherited personality traits distinguish leaders from followers
The ‘Great Person’ theory-Focus is on the person who is leading.
Ghiseli suggests the Northouse suggests a similar list

following 6 traits
1. Supervisory ability 1. Intelligence
2. Occupational 2. Self-Confidence
achievement 3. Determination
3. Intelligence 4. Integrity
4. Self-actualisation 5. Sociability
need
5. Self-assurance need
6. Decisiveness
Video 6m 40s
Trait Theory of Leadership - J. Tirengel

& M. Wilkens, 9/2015
https://www.youtube.com/watch?
v=nKCsNKKPM3c
OCEAN
Most studies and overviews of leadership traits have been qualitative. Five-Factor Personality Model on
Leadership provides a quantitative assessment of leadership traits. It is conceptually framed around the
five-factor model of personality. It describes how five major personality traits are related to leadership
(Northouse, 2007, p.22).In psychology, the Five Factor Model of personality have been scientifically
discovered and accepted by researchers. This model describes five broad dimensions of personality that
define human personality at the highest level of organization (Goldberg, 1993).
These Big five factors are:
18

• Openness (Intellect)
• Conscientiousness (Dependability)
• Extraversion (Surgency)
• Agreeableness, and
• Neuroticism (Emotional Stability)
Each factor consists of a cluster of more specific traits that correlate together. For example, extraversion
includes such related qualities as sociability, excitement seeking, impulsiveness, and positive emotions.
 Openness means the tendency to be informed, creative, insightful, curious and having a variety of
experience.
 Conscientiousness means the tendency to show self-discipline, act dutifully, and aim for
achievement. It means planned rather than spontaneous behavior.
 Extraversion means to have energy, positive emotions, and the tendency to be sociable.
 Agreeableness means the tendency to be compassionate, trusting and cooperative rather than
suspicious and antagonistic towards others.
 Neuroticism means a tendency to experience unpleasant emotions easily, such as anger, anxiety,
depression, or vulnerability.
Judge et al (2002) assessed the links between the Big Five and leadership on the basis of 78 leadership
and personality studies published between 1967 and 1998. They found a strong relationship between the
Big Five traits and leadership. Extraversion was in their study the factor which was most strongly
associated with leadership and therefore the most important trait for effective leaders.The second factor
was conscientiousness and openness followed. Neuroticism was actually the third factor closely related
to leadership, but it was negatively related to leadership. Agreeableness was only weakly associated with
leadership (cited in Northouse, 2007, p.22).
Ghiselli identified six traits as being important for effective leadership:

1.Need for occupational achievement—seeking responsibility; working hard to succeed.
2.Intelligence—using good judgment; having good reasoning and thinking capacity.
3.Decisiveness—making difficult decisions without undue hesitation.
4.Self-confidence—having a positive self-image as a capable and effective person.
5.Initiative—being a self-starter; getting jobs done with minimal supervision.
6.Supervisory ability—getting the job done through others.
Northouse (2007, p.25) lists the weaknesses of the traits approach as follows:
1) The approach has not fixed a definitive list of leadership traits and the list that has
emerged seems endless. i.e. no agreement-so could be situational!
2) The approach has failed to take situations into account.
3) There has much subjective interpretation of the meaning of the data and data is not
always based on reliable research.
4) The trait approach is weak in describing how leaders' traits affect the outcomes of
groups and teams in organizations.
5) Traits are largely fixed psychological structures and this limits the value of teaching and
leadership training.
• The functional or group approach, including action- centred leadership
Functional leadership theories are based on very different assumptions. They focus on what
leaders actually do. That is, their actions
or functions. A function is what you do, as
opposed to a quality, which is an aspect
of who you are. For example, someone
has to define the objectives, make a plan,
or hold the team together if it is
threatened by disruptive forces. You can
learn to provide the functions of
leadership, which are called for by task,
team and individual needs. This is the key
to effective leadership.
19

Unlike the trait approach, the functional approach is helpful in drawing attention to
 The leadership context
 The potential for leadership development
 The potential for devolved leadership
Good managers and leaders should have full command of the three main areas of the Action
Centred Leadership model, and should be able to use each of the elements according to the
situation. Being able to do all of these things, and keep the right balance, gets results, builds
morale, improves quality, develops teams and productivity, and is the mark of a successful
manager and leader. The three overlapping circles illustrate that each of the functions
are interdependent. if a leader focuses too much on one area and neglects the other two,
then the group will experience problems. Situational and contingent elements call for different
responses by the leader. Hence imagine that the various circles may be bigger or smaller as
the situation varies i.e. the leader will give more or less emphasis to the functionally-oriented
behaviours according to what the actual situation involves. The challenge for the leader is to
manage all sectors of the diagram:
The three parts of the model are:

1. achieving the task
2. managing the team or group
3. managing individuals
Leadership functions: in order to fulfil the three aspects of leadership (task, team and
individual) and achieve success, Adair believes that there are eight functions that must be
performed and developed by the leader:
1. Defining the task: Individuals and teams need to have the task distilled into a clear
objective that is SMART (Specific, Measurable, Achievable, Realistic and Time
Constrained).
2. Planning: Planning requires a search for alternatives and this is best done with others
in an open-minded, positive and creative way. Contingencies should be planned for
and plans should be tested.
3. Briefing: Team briefing is viewed as a basic leadership function that is essential in
order to create the right atmosphere, promote teamwork, and motivate each
individual.
4. Controlling: Adair wrote in The Skills of Leadership that excellent leaders get
maximum results with the minimum of resources. To achieve this leaders need self-
control, good control systems in place and effective delegation and monitoring skills.
5. Evaluating: Leaders need to be good at assessing consequences, evaluating team
performance, appraising and training individuals, and judging people.
6. Motivating: Adair distinguishes six principles for motivating others in his book
Effective motivation: be motivated
yourself; select people who are highly Videos -ADAIR
motivated; set realistic and challenging Session 4: The Functional and Action
targets; remember that progress Centred approach to leadership
motivates; provide fair rewards; and development 24m
give recognition. https://www.youtube.com/watch?
7. Organising: Good leaders have to be
v=QZ8ft0coLpc
able to organise themselves, their
team and the organisation (including
structures and processes). Leading Action centred leadership - developing
change requires a clear purpose and leadership skills 2m 20
effective organisation to achieve https://www.youtube.com/watch?
results. v=Oi-2trGx_1Y
8. Setting or providing an example: Leaders need to set an example both to individuals
and to the team as a whole. Since a bad example is noticed more than a good one,
setting a good example is something that must be worked at constantly.
Adair considers that these leadership functions need to be developed and honed to constantly
improve the leader's ability
20

Adair lists what he sees as core functions of leadership and says they are vital to the
action-centered leadership model. Leaders in teambuilding provide the functions of:
 Planning - seeking information, defining tasks, setting aims

 Initiating - briefing, task allocation, setting standards
 Controlling - maintaining standards, ensuring progress, ongoing decision-making
 Supporting - individuals' contributions, encouraging, team spirit, reconciling, morale
 Informing - clarifying tasks and plans, updating, receiving feedback and interpreting
 Evaluating - feasibility of ideas, performance, enabling self assessment
Adair also promotes a '50:50 rule' which he applies to various situations involving two
possible influencers, eg the view that 50% of motivation lies with the individual and 50%
comes from external factors, among them leadership from another. This contradicts most of
the motivation gurus who assert that most motivation is from within the individual. He also
suggests that 50% of team building success comes from the team and 50% from the leader.
One major criticism of Action-Centred Leadership is that it takes little account of the flat
structures that are now generally advocated as the best organisational form. Action-Centred
Leadership is also criticised for being too authoritarian, applicable in a rigid, formal, military-
type environment, but less relevant to the modern workplace where the leadership emphasis
is on leading change, empowering, enabling, managing knowledge and fostering innovation.
Other criticisms levelled at Adair's approach in recent years include the view that his
approaches are too simple, are not academically rigorous and lack real substance in that he
is merely stating the obvious, common sense view.
http://www.kolegjifama.eu/materialet/Biblioteka
%20Elektronike/Handbook_of_Management_and_Leadership.pdf
• Styles of leadership including the authoritarian or autocratic, democratic and laissez- faire
styles –(Lewin, Lippet & White 1939). See also Hersey Blanchard styles – Telling-selling-
participating- delegating. Also Blake & Moulton
Note: styles can be classed as Behaviourist Theories- These concentrate on what leaders
actually do rather than on their qualities. Different patterns of behaviour are observed and
categorised as 'styles of leadership'.
A different perspective to trait theory for leadership is to consider what leaders actually do as
opposed to their underlying characteristics. By the late 1940s researchers became less
concerned with identifying individual traits of leadership and started to be more interested in
leadership behaviours.
21

A number of models and theories have been developed to explore this. One approach
focusing on the behavior of the leader is the style approach. This approach focuses on what
leaders do and how they act (Northouse, 2007, p.69).
This approach indicates that leadership is composed of two general kinds of behaviours:
task-oriented behaviour and relationship-oriented behaviours (McCaffery, 2004, p.64).
Task-oriented behaviours facilitate goal accomplishment and help group members to achieve
their objectives. Relationships-oriented behaviours help subordinates feel comfortable with
themselves, with each other, and with the situation in which they find themselves. The central
purpose of the style approach is to explain how leaders combine these two kinds of
behaviours to influence subordinates in their efforts to reach a goal (Northouse, 2007, p.69).
Many studies have been conducted to investigate the style approach: for example, The Ohio
State University Study, The University of Michigan Study and Blake and Mouton's Leadership
Grid. Adair (1983), Likert (1967) and Mintzberg (1973) have advocated this approach.
Authoritarian (or autocratic) style:

Power and authority for planning, organising and decision making are centralised in the hands
of the leader, and all communication and interactions focus on or through him.
Democratic style:
Decision-making is decentralised, shared by team members via participative processes, and
there is greater group interaction.
Laissez-faire (‘let them do it’) style:
The team is genuinely autonomous, organising its own work and making decisions.
Blake & Mouton- managerial Grid 1964
Blake and Mouton studied leadership behaviour and described two extremes of leadership
concern:
Concern for Production: The leader cares little about people and operates in fear of
something going wrong. This person's focus is on achieving results and productivity.
Concern for People: This leader cares little about productivity and operates wholly from a
desire to be loved and approved.
Blake and Mouton's Managerial Grid

5m 11s
https://www.youtube.com/watch?
v=Vz5hgX2MYbE
https://youtu.be/Vz5hgX2MYbE
The Five Styles Explained

Here's a snapshot of the five different leadership styles resulting from the grid:
(1,1) 'Impoverished' The leader applies (and expects) minimal effort and has little concern
for either staff satisfaction or work targets. This is a leader who is going through the motions is
indifferent, non-committal, resigned and apathetic. S/he is doing just enough to keep their job.
(1,9) 'Country Club' The leader is attentive to his/her people's needs and has developed
satisfying relationships and work culture - but at the expense of achieving results. The leader
is defined as agreeable, eager to help, non-confrontational, comforting and uncontroversial.
(5,5) 'Middle of the Road' (Politician)
This leader is a compromiser who wants to maintain the status quo and avoid any problems.
Is aware of and wants a focus on productivity but not at the expense of the morale of his/her
team.
(9,1) 'Authoritarian' The leader concentrates almost exclusively on achieving results. People
are viewed as a commodity to be used to get the job done. Communication is de-emphasized
and conflict is resolved by suppressing it. Leadership is controlling, demanding and over-
22

powering. high concern for production, low concern for people. This is associated with
McGregor’s Theory X.
(9,9) 'Team' The leader achieves high work performance through 'leading' his/her people to
being dedicated to the organizational goals. There is a high degree of participation and
teamwork, which satisfies the basic need of people to be involved and committed to their
work. The leader may be characterized as open-minded, flexible and one who inspires
involvement.
Generally 9,9 where there is mutual regard and respect is where we should be trying to move
toward ... it leads to better decisions even in crisis situations. When a leader has built trust
and rapport the team members will feel comfortable to offer insights and opinions, even if they
are 'bad news'. This is associated with McGregor’s Theory Y. Team leadership is regarded as
the ideal but it is should be appreciated that there is no one best style suitable for all
occasions. The most effective leaders will adapt their leadership style to suit the situation.
• Contingency theories for leadership such as path-goal theory
According to contingency theory effective leadership is seen as dependent not just on style of
leadership but on the context and situation in which the style was used. In other words, in
a manufacturing unit there is likely to be more emphasis on directing subordinates to
complete tasks whereas in a service industry relationship building is important. Unlike the
trait and behavioural views of the leadership, the contingency view suggests that there is no
universal style which works in all situations and that the level of effectiveness is best
evaluated in a unit’s success in achieving its objectives. Different styles will be more or
less effective depending on the situation in which leaders find themselves. And so, the
style of the leader in the army may be very different from that of a church leader.
Fiedler's Contingency Model – PDMS & PCMs-Where PDM=psychologically distant =

task orientated & PCM= close= relationship orientated
Fiedler's contingency theory postulates that there is no single best way for managers to lead.
Situations will create different leadership style requirements for a manager. The solution to a
managerial situation is contingent on the factors that impinge on the situation. For example, in
a highly routine (mechanistic) environment where repetitive tasks are the norm, a relatively
directive leadership style may result in the best performance, however, in a dynamic
environment a more flexible, participative style may be required.
Fiedler looked at three situations that could define the condition of a managerial task:
1. Leader member relations: How well do the manager and the employees get along? : e.g.
liking, trust, respect, wiliness to follow.
2. Task structure: Is the job highly structured, fairly unstructured, or somewhere in between?
3. Position power: How much authority does the manager possess? the relative power of the
leader and the group. Specifically the leader’s ability to reward or punish the team.
Path-Goal theory –House Contingency Theory

According to contingency theory effective leadership is seen as dependent not just on style of
leadership but on the context and situation in which the style was used. In other words, in
a manufacturing unit there is likely to be more emphasis on directing subordinates to
complete tasks whereas in a service industry relationship building is important.
Unlike the trait and behavioural views of the leadership, the contingency view suggests that
there is no universal style which works in all situations and that the level of effectiveness is
best evaluated in a unit’s success in achieving its objectives. Different styles will be more
or less effective depending on the situation in which leaders find themselves. And so, the
style of the leader in the army may be very different from that of a church leader.
The path-goal theory of leadership (House, 1971) was developed to explain how the
behaviour of a leader influences the satisfaction and performance of a subordinate.
According to House and Dressler.
“ …leader behaviour will be viewed as acceptable to subordinates to the extent the

subordinates see such behaviour as either an immediate source of satisfaction or as
instrumental to future satisfaction”.
23

Path-Goal Theory Northouse 6e Chapt 7-16 minutes northouse
https://www.youtube.com/watch?v=IKFuLtVxw20
This is an approach based on expectancy theory of motivation (Vroom, 1964).

This holds that a person makes a rational choice regarding how much effort to devote to the
job at a given point in time. They take into account the likelihood of completing the task
satisfactorily whilst achieving desirable outcomes (e.g. pay, promotion and/or
recognition) and avoiding undesirable outcomes (e.g. reprimand, rejection, stress). The
leader’s role is to modify these perceptions and beliefs in a way that motivates the individual.
As House (1971, p34) explains it:-“The motivational function of the leader consists of
increasing personal pay-offs to subordinates for work-goal attainment and making the path to
these pay-offs easier to travel, by clarifying it, reducing roadblocks and pitfalls, and
increasing the opportunities for personal satisfaction en route.”
The path–goal theory of leadership suggests that the performance of subordinates is affected
by the extent to which the manager satisfies their expectations. Path–goal theory holds that
subordinates will see leadership behaviour as a motivating influence to the extent that it
means:
■ satisfaction of their needs is dependent upon effective performance; and

■ the necessary direction, guidance, training and support, which would otherwise be lacking,
is provided.
House identifies four main types of leadership behaviour.
1. Directive leadership involves letting subordinates know exactly what is expected of them
and giving specific directions. Subordinates are expected to follow rules and regulations.
(leader guides and coordinates)
2. Supportive leadership involves a friendly and approachable manner and displaying
concern for the needs and welfare of subordinates. (leader is affiliative and considerate)
24

3. Participative leadership involves consulting with subordinates and the evaluation of
their opinions and suggestions before the manager makes the decision. (leader consults
and involves)
4. Achievement-oriented leadership involves setting challenging goals for subordinates,
seeking improvement in their performance and showing confidence in subordinates’
ability to perform well. (leader challenges and promotes excellence).
According to the path-goal theory the effect leader behaviour has on subordinate
satisfaction and effort depends also on situational factors such as task and subordinate
characteristics and vice versa. The main issues raised about the reliability of the model are
concerned with its complexity and rational decision biases which seem to take little account of
the emotional reactions that influence motivation. House (1996) has tried to address these
points by incorporating transformational behaviours into the model but it remains complex
and complicated for practitioners to use.
2.0 Understand and apply communication planning techniques and analyse their
influence on individuals involved in the supply chain
2.1 Evaluate influencing styles that can be used in the effective leadership of a supply
chain
• Implementing a vision of improved procurement and supply chain

management
• Models for managing in four different directions
• The relevance of managing upwards and across to achieve desired results for
improved supply chain management
• The merits of escalation as a means of influencing
• A range of influencing styles for cross functional leadership both within and
outside the bounds of formal teams
True influence involves building trust in a relationship, getting those people to align their views
and values with your own for long-term gain. Short-term change doesn’t rely as much upon
emotional connection, instead it uses other tactics like reasoning, manipulation, or coercion.
These are the main influencing styles detailed in the study guide- most are self-explanatory.
Assertive – uses logic or reasoning, facts confirm validity. Used to demand on challengers
Convincing-If you are more subtle with your logic and reasoning, putting forward your ideas
with a rational persuasion, then you are using a Convincing style.
Consulting – uses experience of team, suggestions, allows owners when not self-sure
Collaborative – issue resources, minimise difficulty, influence and utilise relationship
Bridging- Bridging is all about the other person. It’s about creating a bridge between you and
the person you are trying to influence, so that you truly understand their situation and their
perspective, without sacrificing your own position.
Inspiring – appeal beliefs, emotions, value. Gets team believing in greater good
Negotiating- A person who searches for compromises and seeks a result which gives a better
outcome and is happy to make trade-offs, uses a Negotiating style. However may use win-
win.
25

Boddy and Buchanan 1998 -leading and influencing in four directions
1. Managing across; this aspect refers to leading and influencing stakeholders outside of the
team or function within which you are working
2. Managing the team; refers to leading and influencing teams of individuals either within or
outside of the purchasing function, meaning colleagues and peers rather than your direct
reports
3. Managing the Staff; this ‘direction’ refers to leading and influencing direct reports
4. Managing up; this refers to leading and influencing your Senior Management (those higher
up in the organisational hierarchy)
The influence tactics are used in different directions, i.e., not only do managers try to
influence subordinates, but these tactics are also used vice versa and to influence peers.
Research shows that:
 Managing Upwards- Managing upwards will require assertiveness and the ability to state
clearly, positively and persistently what is required. A number of tactics would be
appropriate including rational persuasion, coalition and ingratiation or personal appeal.
Persuasive communication to senior managers will be concise, presenting logical
arguments and demonstrate an ability to take a wider view.
 Downward- inspirational appeals, consultation, ingratiation, exchange, legitimating, and
pressure are used more downward (i.e., to influence subordinates) than upward (i.e., to
influence superiors)
Study guide suggests-Inspirational appeal (by transformational or democratic leaders).
Rational persuasion: effective because it explains the reason and significance of the
request, allowing subordinates to ‘buy into’ it rather than simply complying without
question-Pressure (by autocratic leaders). May adopt a wide range of approaches to this
direction of management. However, probably the most productive would be to adopt a
consultative and participative approach rather than purely directive. Managing downwards
will engage a wide range of staff on a team basis. Influencing tactics when managing
down will include a balance of telling and selling approaches.
 Managing Across- study guide-Personal appeal or ingratiation, Rational persuasion and
consultation, Exchange, Legitimating
Internal-A cross functional approach will require a range of leadership roles including
team leadership, project sponsorship and autonomous or self-management. There are
likely to be a range of issues that Francesco will need to take account of when trying to
manage across other functional heads. These will include accepting a range of different
viewpoints, different priorities, lack of authoritarian/instructive position requiring
collaboration and co-operation. Influencing styles will include personal appeal, rational
persuasion and exchange.
Managing across – External – Suppliers-When managing horizontally external to the
organisation, a networking approach will be appropriate. This will involve the development
of strong external networks with suppliers building trust and co-operation. External
26

linkages may include the use of tools such as force field analysis, SWOT analysis and
mapping of formal and informal connections between Francesco and his purchasing team
and the external suppliers.
Managing the team; refers to leading and influencing teams of individuals either within or
outside of the purchasing function, meaning colleagues and peers rather than your direct
reports
Challenges of cross-functional working
 It adds potential for time-consuming complexity, conflict and consensus-seeking
 Horizontal structures may lack clear authority structures
 All teams take time to develop before they perform effectively
 There may be difficulties of dual authority structures and conflicting demands, if
cross-functional team members also report to their individual departments
 There may be practical difficulties of organising meetings and information flows, given
different functional work patterns, locations and so on
Managing up; this refers to leading and influencing your Senior Management (those higher
up in the organisational hierarchy)
Main issue is:
 Lack of positional authority to impose
 Requires assertiveness & subtlety
Persuasive communication to ones superiors should
 Use appropriate channels and methods of communication
 Be concise, relevant, professional and timely
 Present logical argument, leading to a firmly supported conclusion or
recommendation
 Present a business case for any proposals, plans or recommendations being put
forward
This Question focuses on the framework proposed by Boddy and Buchanan (1998), although,
in the context of this question, may well be seen as too simplistic.
The main areas we expected to be included in this answer were;
*Managing Across-this aspect refers to leading and influencing stakeholders outside of the
team or function in which you are working. Mendelow’s framework (1991) could
appropriately be mentioned here, where a more traditional approach to stakeholder
management is offered
*Managing the Team-this aspect refers to leading and influencing teams of individuals
either within the purchasing function or within a cross -functional team. This aspect
specifically refers to your colleagues and peers, rather than colleagues who are your
direct reports. Yukl’s framework, for example, would be appropriate to mention here.
Managing the Staff-this refers to leading and influencing those who work directly for
you. Possible supporting concepts to integrate here include Yukl (1989), Cialdini (2001) and
French and Raven (1956). In addition various leadership theories, for example the
ideas forwarded by Hersey or Tannenbaum and Schmidt may also be appropriate to
mention and contextually apply.
*Managing Up-this aspect refers to managing and influencing those more senior within
the organisation’s hierarchy. Concepts to be mentioned here may include Yukl once again,
however, with care as only some aspects of this framework may be seen to be ‘effective’ in
this context
*as requested in the Question, all key points needed to be contextualised within the
Candidates organisation of choice.
 Merits of Escalation as a means of Influencing
•Order of influencing tactics of Yukl & Falbe (p45) and can be seen as progressive
escalation- from pull to push
27

•Gives a clear message that the influencer is serious about issue
•But there are costs- hardened resistance- resentment etc.
•May involve appeal to higher authority
• A range of influencing styles for cross functional leadership both within and outside the
bounds of formal teams
Team Leadership
In the late 1970’s Meredith Belbin conducted a study of teams focusing on the factors
separating successful and unsuccessful teams… a feature of which was shared leadership.
Belbin found that the composition of the team was important and that individual differences in
style, role and contribution far from underlining personal weaknesses, were a source of
potential team strength. Balanced teams comprised of such individuals who engaged in
complementary role behaviour performed better than unbalanced teams.
Nine distinctive roles were identified in the study, with most people being found to embrace a
mix of two or three roles whilst also avoiding others with which they were uncomfortable.
Where there was an individual with clear, useful and appreciated attributes they would fit into
a team on the basis of the strengths they brought. These people would also have
weaknesses that belonged to the same cluster of characteristics as the strength itself. These
potential deficiencies were considered the price that has to be paid for a particular strength, a
price that is worth paying, and were referred to as ‘allowable weaknesses. Belbin found no
‘ideal’ team member, individual who could perform all of the roles.
From this work, Belbin drew the distinction between the “Solo” and the “Team” leader. He
suggests that “leaders are not notable for admitting their weaknesses, whether allowable or
not.
The increasing complexity and the discontinuous nature of modern work however, poses
greater problems where Solo leadership is less appropriate and ‘Team leadership’ more
suited.
Factors to consider if you encounter poor performance the 3 C’s
 Commitment-- How willingly and energetically people approach their work-

Mowdray, Porter and Steers describe it as:
'the relative strength of an individual's identification with and involvement

in a particular organisation. It is characterised by at least three factors:
1. a strong belief in and acceptance of an organisation's goals and values;
2. a willingness to exert considerable effort on behalf of the organisation;
3. and a strong desire to maintain membership of the organisation.'
28

Employee commitment correlates strongly with effective leadership -
which, by definition, involves the use of vision articulation, motivation, role
modelling and other techniques to foster willing and above-compliance
levels of effort.
 Contribution- the conditions required- for individual & team must be;
 Commissioned by clear task objectives and delegation of sufficient
authority to perform them
 Controlled by clear values, policies, procedures (if necessary), targets and
success criteria – and the feedback to adjust performance accordingly
 Championed by leadership support, acknowledgement and inspiration
 Co-operative via mechanisms for co-ordination, information-sharing and
team working
 Capability- What people are ‘able’ to do
 Capacity: what people are capable of, or able to learn: their qualities and
aptitudes
 Competence: what people are able (or can learn) to do
 Creativity: the ability to do new things and formulate new ideas or

combinations of ideas
The Five Dysfunctions of A Team -Lencioni
There are five dysfunctions all teams must overcome in order to be truly productive as
detailed on the slide.
1. Absence of Trust resulting from Invulnerability:

If the members of the team can't share their past experiences and present thoughts, they will
not trust each other enough to honestly discuss future goals for the team.
2. Fear of Conflict resulting from Artificial Harmony:
If the members of the team are concerned that their honest comments may throw off
balance the ease they’ve created by holding back, then everyone will keep holding back.
3. Lack of Commitment resulting from Ambiguity:
If the members of the team do not believe in the main goal of the team, ultimately, they will
not support it.
4. Avoidance of Accountability resulting from Low Standards:
If the members of the team are concerned they will insult their peers by questioning
their decisions, they won’t ask the hard questions.
5. Inattention to Results resulting from Status and Ego:
If the members of the team do not truly believe in the team’s ability to achieve
an overarching goal, they will go rogue to save their individual career.
The SEVEN psychological principles of persuasion
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Dr. Robert Cialdini Pre-Suasion: A Revolutionary Way to Influence and Persuade
Paperback – 20 Apr 2017
Explains the psychological principles that drive our powerful impulse to comply to the
pressures of others .It also explains how we can avoid being manipulated or
unconsciously manipulating others
Robert Cialdini has developed the SEVEN principles of influence
1. Reciprocity. The idea of reciprocity says that people by nature feel obliged to provide
either discounts or concessions to others if they’ve received favors from those others.
Psychology explains this by stressing that we humans simply hate to feel indebted to
other people.
2. Commitment (and Consistency). This principles explains that humans have a deep need
to be seen as consistent. Once we have publicly committed to something or someone,
we are much more likely to go through and deliver on that commitment…hence
consistency.
3. Social Proof. This is when people do what they observe other people doing (when
uncertain, there is safety in numbers)
4. Authority. We trust authority figures and they are inherently more persuasive because of
this (authority can be based on many factors – wealth, uniforms, status, etc.)
5. Liking. The more you like someone, the more likely it is you’ll be persuaded by them.
6. Scarcity. When you believe something is in short supply, you want it more.
7. Unity -The Unity Principle is the shared identity that the influencer shares with the
influencee. According to Cialdini, the Unity principle moves beyond surface level
similarities (which can still be influential, but under the Liking principle). Instead, he says,
“It’s about shared identities.”
2.2 Compare leadership techniques that can be used to influence personnel involved
in a supply chain
• Assessing the readiness of followers or groups
• Leaders attitudes to people
• Management by objectives and establishing KPIs
• Self-development
• Emotional intelligence
Hersey and Blanchard

30

The theory states that instead of using just one style, successful leaders should change their
leadership styles based on the maturity of the people they're leading and the details of the task.
Using this theory, leaders should be able to place more or less emphasis on the task, and more or
less emphasis on the relationships with the people they're leading, depending on what's needed
to get the job done successfully.
This model is based on the amount of direction (task behaviour) and the amount of
socioemotional support (relationship behaviour) a leader must provide given the situation and
the level of “readiness” of the follower or group.
The recognition of task and relationship as two critical dimensions of a manager’s behaviour
has been an important part of management research over the last several decades. These
two dimensions have been given various labels ranging from “autocratic” and “democratic” to
“employee oriented” and “production oriented”
For some time, it was believed that task and relationship behaviours were either/or styles of
leadership and, therefore, could be represented by a single continuum, moving from very
authoritarian leader behaviour (task) at one end to very participative leader behaviour
(relationship) at the other end.
In more recent years, the idea that task and relationship behaviours were either/or leadership
styles has been dispelled.
By spending time actually observing the behaviour of leaders in a wide variety of situations,
the Ohio State staff found that they would classify most of the activities of leaders into two
distinct and different behavioural categories or dimensions. They named these two
dimensions “Initiating Structure” (task behavior) and “Consideration” (relationship behaviour).
These two dimensions can be defined in the following way:
Task behaviour is the extent to which a leader engages in one way communication by
explaining what each follower is to do as well as when, where and how tasks are to be
accomplished.
Relationship behaviour is the extent to which a leader engages in two-way communication
by providing socioemotional support, “psychological strokes” and facilitating behaviours.
Level of Readiness
Situational Leadership defines readiness as the ability and willingness or a person to take
responsibility for directing their own behaviour. These variables of readiness should be
considered only in relation to a specific task to be performed. That is to say, an individual
(or a group) is not at a level of readiness in any total sense. People tend to have vary degrees
or readiness depending on the specific task, function or objective that a leader is attempting
to accomplish through their efforts.
31

According to Situational Leadership, as the level of readiness of a follower continues to
increase in terms of accomplishing a specific task, the leader should begin to reduce task
behaviour and increase relationship behaviour. This should be the case until the individual or
group reaches a moderate level or readiness, it becomes appropriate for the leader to
decrease not only task behaviour but relationship behaviour as well. Now the follower is not
only ready in terms of the performance of the task but is also confident and committed.
Thus, Situational Leadership focuses on the
appropriateness or effectiveness of leadership styles Dr. Paul Hersey - Situational
according to the task-relevant readiness of the Leadership 4m 18s
follower. This cycle can be illustrated by a bell-shaped
curve superimposed on the four leadership https://www.youtube.com/watch?
quadrants . v=lIPK9APaBnk
According to Hersey and Blanchard, there are four
https://youtu.be/lIPK9APaBnk
main leadership styles:
5. Telling (S1) – Leaders tell their people what to
do and how to do it. OPD4835 - Situational Leadership 4m
6. Selling (S2) – Leaders provide information 14
and direction, but there's more https://www.youtube.com/watch?
communication with followers. Leaders "sell" v=sGCxEP8R6MQ
their message to get people on board. https://youtu.be/sGCxEP8R6MQ
7. Participating (S3) – Leaders focus more on
the relationship and less on direction. The
leader works with the team, and shares
decision-making responsibilities.
8. Delegating (S4) – Leaders pass most of the responsibility onto the follower or group.
The leaders still monitor progress, but they're less involved in decisions.
As you can see, styles S1 and S2 are focused on getting the task done. Styles S3 and S4 are
more concerned with developing team members' abilities to work independently.
Maturity Levels
According to Hersey and Blanchard, knowing when to use each style is largely dependent on
the maturity of the person or group you're leading. They break maturity down into four
different levels:
5. M1 – People at this level of maturity are at the bottom level of the scale. They lack the
knowledge, skills, or confidence to work on their own, and they often need to be
pushed to take the task on.
6. M2 – at this level, followers might be willing to work on the task, but they still don't
have the skills to complete it successfully.
7. M3 – Here, followers are ready and willing to help with the task. They have more
skills than the M2 group, but they're still not confident in their abilities.
8. M4 – These followers are able to work on their own. They have high confidence and
strong skills, and they're committed to the task
In attempting to improve the readiness of a follower who has not taken much responsibility in
the past, a leader must be careful not to increase socioemotional support (relationship
behaviour) too rapidly. If this is done, the follower may view the leader as becoming a “soft
touch.” Thus, the leader must develop the follower slowly, using a little less task behaviour
and a little more relationship behaviour as the follower increases in readiness. When an
individual’s performance is low, one cannot expect drastic changes overnight. For more
desirable behaviour to be obtained, a leader must reward as quickly as possible the slightest
appropriate behaviour exhibited by the individual in the desired direction. This process
continues as the individual’s behaviour comes closer and closer to the leader’s expectations
of good performance.
Key Points
All teams, and all team members, aren't created equal. Hersey and Blanchard argue that
leaders are more effective when they use a leadership style based on the individuals or
groups they're leading.
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Start by identifying whom you're leading. Are your followers knowledgeable about the task?
Are they willing and excited to do the work? Rate them on the M1 - M4 maturity scale, and
then use the leadership style that's appropriate for that rating.
 Leaders attitudes to people –

McGregor
Theory X and Y represent extremes of the natural inclination of managers towards a
particular style of behaviour. In practice the actual management style adopted is
influenced by the demands of the given situation
Theory X assumes that –
 The average person is lazy & has an inherent dislike of work
 Most people must be coerced, controlled, directed & threatened with
punishments if the organisation is to achieve its objectives
 The average person avoids responsibility, preferring to be directed
 Motivation occurs only at the physiological & security levels
Theory Y assumes that –
 For most people work is as natural as play or rest

 People will exercise self-direction & self-control
 Commitment to objectives is a function of rewards associated with their
achievement
 Given the right conditions, the average worker can accept and seek
responsibility
No one is a born leader—everyone can develop leadership skills and everyone can benefit
from using them.
Leadership skills can be differentiated from other kinds of ‘leadership characteristics’

because they are:
• Behavioural (observable and identifiable sets of actions that individuals perform)
• Controllable (able to be consciously practised, improved or avoided by individuals)
• Developable (amenable to learning, practice and feedback, in pursuit of higher levels
of competency)
National Occupational Standards for Management and Leadership
The standards are proven benchmarks of best practice … They offer a practical resource to
aid decisions in everything from day-to-day matters like recruitment and selection to long-term
issues such as the recognition and development of future leaders. There are SIX areas:
A - Managing self and personal skills
B - Providing Direction
C - Facilitating Change
D - Working with People
E - Using Resources
F - Achieving Results
They include:
 Outcomes of effective performance
 You must be able to do the following:
 Behaviours which underpin effective performance
Communication skills for leadership
 Promotion
 Influencing and persuasion
 Negotiation
 Inspiration
 Support and challenge
Integrity and ethics 1.14 chapter 6
33

 Consistency-you can be relied on to do what you’ve said you will do
 Openness-your decision-making processes are transparent
 Honesty-your conduct models high standards of personal and professional ethics
 Respect for people-you are committed to treating people fairly and with professional
courtesy
 Authenticity -the perception by followers that a leader’s word and deeds consistently
match
 Credibility- the ability to inspire trust and confidence in followers
•Emotional intelligence
What Makes a Leader?- Goleman

Truly effective leaders are also distinguished by a high degree of emotional intelligence, which
includes
 self-awareness,
 self-regulation,
 motivation,
 empathy,
 and social skill.
These qualities may sound “soft” and unbusiness like, but Goleman found direct ties between
emotional intelligence and measurable business results. While emotional intelligence’s
relevance to business has continued to spark debate over the past six years, Goleman’s
article remains the definitive reference on the subject, with a description of each component
of emotional intelligence and a detailed discussion of how to recognize it in potential leaders,
how and why it connects to performance, and how it can be learned.
It’s not that IQ and technical skills are irrelevant. They do matter, but mainly as “threshold
capabilities”; that is, they are the entry-level requirements for executive positions. But my
research, along with other recent studies, clearly shows that emotional intelligence is the sine
qua non of leadership. Without it, a person can have the best training in the world, an incisive,
analytical mind, and an endless supply of smart ideas, but he still won’t make a great leader.
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 Management by objectives and establishing KPIs
A management style or system that relates organisational goals to individual performance &
development through involvement of all levels of management-Developed by Peter Drucker in
his book the practice of management in 1954
The basis for MBO is –
• The setting of objectives & targets
• Participation by individual managers in agreeing unit objectives & criteria of
performance
• The continual review & appraisal of results
Koontz, O'Donnell and Weihrich, "MBO is a comprehensive managerial system that

integrates many key managerial activities in a systematic manner, consciously directed
towards the effective and efficient achievement of organisational and individual objectives."
The overall process of MbO involves the following steps.

 Developing a coherent strategic plan, with clear organisational goals and objectives
 The cascading of organisational goals and objectives down through the organisation:
from enterprise level to business unit to function to team to individual
 The management of performance through a classic planning and control cycle:
setting objectives;
 Action planning; performance review and evaluation; and adjustment in the following
planning period.
 Collaboration between managers and team members in setting objectives and
standards, implementing plans (with managers providing support as required),
reviewing results and planning adjustments
At the individual management level, steps in an MBO process are as follows.

 Collaboratively define each individual's major areas of responsibility and the purpose
of their role within the corporate plan.
 Jointly define and agree the key tasks which are directly related to the achievement of
the objectives, and in which any performance shortfall would negatively impact on
success.
 Jointly define and agree, for each key task, key results (which must be achieved in
order for the key tasks to be successfully performed and objectives met) and methods
of monitoring and measuring performance in these areas (key performance
indicators).
 Agree individual (or unit) performance improvement plans for a defined planning
period: developing or selecting SMART improvement objectives for each key task and
formulating action plans to achieve those objectives.
 Implement monitoring, self-evaluation and periodic review of performance at agreed
intervals, and revise objectives, targets and action plans as required.
The cycle of MBO activities
Problems
 Places too much emphasis on
individual job definition &
management authority
structure
 Assumes no conflict between
individual & organisational
goals
 Not always easy to set
specific targets or figures for
senior jobs
35

Performance management
It is sometimes assumed that performance appraisal is the same thing as performance
management. But there are significant differences. Performance appraisal can be defined as the
formal assessment and rating of individuals by their managers at or after a review meeting.
Performance management (Armstrong & Baron) is 'a process which contributes to the effective
management of individuals and teams in order to achieve high levels of organisational
performance. As such, it establishes shared understanding about what is to be achieved and an
approach to leading and developing people which will ensure that it is achieved'. It is 'a strategy
which relates to every activity of the organisation set in the context of its human resource policies,
culture, style and communications systems. The nature of the strategy depends on the
organisational context and can vary from organisation to organisation'.
Performance management is a tool to ensure that managers manage effectively, so that they and
their teams
• Know and understand what is expected of them.
• Are equipped to deliver on these expectations.
• Are given proper feedback on their performance.
• Are supported by the organisation to develop the capacity to meet these expectations.
• Are encouraged to contribute to individual and team aims and objectives.
A performance management culture ensures managers themselves are aware of the impact of
their own behaviour on the people they manage and are encouraged to identify and exhibit
positive behaviours. The organisation itself will determine what those behaviours are and what its
expectations are in terms of performance.
Good performance management is about creating an effective strategy of performance, putting in
place the tools to facilitate continuous improvement and address any problems that arise, and
ensuring good two way communication so as to convey and share expectations. It should apply to
all employees, not just managers, and to teams as much as individuals. It is a continuous
process, not a one-off event. Last but not least, it should be capable of objective measurement so
that improvement and necessary development can be seen and assessed.
• Preparation of performance agreements (also known as performance contracts)

These set out the individual’s or team’s objectives, how performance will be
measured, the competencies needed to achieve the objectives and the organisation’s
core values.
• Preparation of performance and development plans
These set out identified performance and personal development needs in order for
performance agreements to be met.
• Management of performance throughout the year
This involves the continuous process of providing feedback on performance.
• Performance review and appraisal
Taking a view of an individual’s progress to date and reaching an agreement about
what should be done in the future.
Performance and development agreements

Performance and development agreements form the basis for development, assessment and
feedback in the performance management process. They define expectations in the form of a
role profile, which sets out role requirements in terms of key result areas and the
competencies required for effective performance. The role profile provides the basis for
agreeing objectives and methods of measuring performance and assessing the level of
competency reached. The performance agreement incorporates any performance
36

improvement plans that may be necessary and a personal development plan. It describes
what individuals are expected to do but also indicates what support they will receive from their
manager.
Defining role requirements

The foundation for performance management is a role profile, which defines the role in terms
of the key results expected, what role holders need to know and be able to do (technical
competencies), and how they are expected to behave in terms of behavioural competencies
and upholding the organization’s core values. Role profiles need to be updated every time a
formal performance agreement is developed.
Objectives
Objectives or goals describe something that has to be accomplished. Objectives setting that
results in an agreement on what the role holder has to achieve is an important part of the
performance management processes of defining and managing expectations and forms the
point of reference for performance reviews.
Types of objectives
Ongoing role or work objectives – all roles have built-in objectives that may be expressed as
key result areas in a role profile.
Targets – these define the quantifiable results to be attained as measured in such terms as
output, throughput, income, sales, levels of service delivery and cost reduction.
Tasks/projects – objectives can be set for the completion of tasks or projects by a specified
date or to achieve an interim result.
Criteria for objectives
Specific-clear and well-defined statement of precisely what the desired outcomes or

deliverables are
Measurable-susceptible to monitoring, review and measurement
Attainable-achievable and realistic, given the time and resources available
Relevant-relevant to, and aligned with, the strategic objectives of the organisation; the
policies and objectives of the procurement function; the critical success factors of the
organisation and supply chain; the business need and so on
Time-bounded-given defined timescales and deadlines for completion (or review)
Developing key performance indicators
Here are the 5 steps to create measurable and actionable KPIs.
Step 1: Establish Goals & Objectives
Step 2: Establish Critical Success Factors (CSF) from the Goals & Objectives
Step 3: Establish Key Performance Indicator (KPI) from CSF
Step 4: Collect Measures

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Step 5: Calculate Metrics from Measures
https://unilytics.com/5-steps-to-actionable-key-performance-indicators/
Procurement KPIs
Category Measure
General Measures Purchases as a percent of sales
Purchasing Employees as a percent of company employees
Sales per purchasing employee
Purchase spent per active supplier
Purchase order cycle time (in days)
Percent of purchase transactions processed thru e-
commerce
Percent of services purchases handled by the purchasing
department
Number of suppliers
Cost Cost of Purchasing Order
Cost avoidance = Actual Purchasing Price – Lowest Price
Quoted
Cost Reduction = Actual Purchasing Price – Last Price Paid
Procurement ROI = (Cost Reduction + Cost Avoidance)/Cost
of Procurement Operation
Quality Supplier Quality Rating = (Lots Accepted/Lots Inspected) x
(Samples Accepted/Samples Inspected) x 100
Rework and Scrap Value in Dollars
Return to Vendor Cost
Ratio of Rejection = $ Value of Goods Rejected/$ Value of
Goods Received
Percentage of Suppliers Certified
Delivery KPI’s Lead Time Index
Supplier Expediting Summary
Availability = No. of times goods were available from
supplier/No. of orders placed with the supplier
Inventory KPI’s Inventory Turnover Ratio = Forecasted Cost of Goods Sold
Over the Next 12 Months/Current Inventory Value
(Inventory average is 3)
Inventory Carrying Cost
Inventory Activity = Average Monthly Inventory
Relieved/Total on Hand Inventory
Employee Learning & Growth KPI’s Number of Procurement staff with Certifications
Formal Classroom training
Training Investment per employee vs percentage of dollar
spend
Employee Participation in Professional Bodies
Benefits of using KPIs

 Increased and improved (results-focused) communication on performance issues
 Motivation to achieve or surpass the specified performance level
38

 Support for integrated, collaborative performance measurement and improvement
 The ability directly to compare year on year performance, to identify improvement or
deterioration trends
 Focus on key results areas for the team, unit or supply chain
 Reduced conflict arising from causes such as goal confusion and unclear
expectations
Measuring performance in achieving objectives

Measurement is an important concept in performance management. It is the basis for
providing and generating feedback, it identifies where things are going well to provide the
foundations for building further success, and it indicates where things are not going so well,
so that corrective action can be taken.
There are components in all jobs that are difficult to measure quantifiably as outputs, but all
jobs produce outcomes even if they are not quantified. It is therefore often necessary to
measure performance by reference to what outcomes have been attained in comparison with
what outcomes were expected, and the outcomes may be expressed in qualitative terms as a
standard or
Behavioural – behavioural expectations are often set out generally in competency frameworks
but they may also be defined individually under the framework headings. Competency
frameworks may deal with areas of behaviour associated with core values, for example
teamwork, but they often convert the aspirations contained in value statements into more
specific examples of desirable and undesirable behaviour, which can help in planning and
reviewing performance level of competency to be attained. That is why it is important when
agreeing objectives to answer the question, ‘How will we know that this objective has been
achieved?’ The answer needs to be expressed in the form, ‘Because such and such will have
happened.’ The ‘such and such’ will be defined either as outputs in such forms as meeting or
exceeding a quantified target, completing a project or task satisfactorily (what is ‘satisfactory’
having been defined), or as outcomes in such forms as reaching an agreed standard of
performance, or delivering an agreed level of service.
Performance planning
The performance planning part of the performance management sequence involves
agreement between the manager and the individual on what the latter needs to do to achieve
objectives, raise standards, improve performance and develop the required competencies. It
also establishes priorities – the key aspects of the job to which attention has to be given. The
aim is to ensure that the meaning of the objectives, performance standards and competencies
as they apply to everyday work is understood. They are the basis for converting aims into
action.
Personal development planning
A personal development plan provides a learning action plan for which individuals are
responsible with the support of their managers and the organization. It may include formal
training but, more importantly, it will incorporate a wider set of learning and development
activities such as self-managed learning, coaching, mentoring, project work, job enlargement
and job enrichment. If multi-source assessment (360-degree feedback) is practised in the
organization this will be used to discuss development needs.
The development plan records the actions agreed to improve performance and to develop
knowledge, skills and capabilities. It is likely to focus on development in the current job – to
improve the ability to perform it well and also, importantly, to enable individuals to take on
wider responsibilities, extending their capacity to undertake a broader role. This plan therefore
contributes to the achievement of a policy of continuous development that is predicated on
the belief that everyone is capable of learning more and doing better in their jobs. The plan
will also contribute to enhancing the potential of individuals to carry out higher-level jobs.
Managing performance throughout the year
Perhaps one of the most important concepts of performance management is that it is a
continuous process that reflects normal good management practices of setting direction,
monitoring and measuring performance and taking action accordingly. Performance
management should not be imposed on managers as something ‘special’ they have to do. It
should instead be treated as a natural function that all good managers carry out.
To ensure that a performance management culture is built and maintained, performance
management has to have the active support and encouragement of top management who
39

must make it clear that it is regarded as a vital means of achieving sustained organizational
success.
They must emphasize that performance management is what managers are expected to do
and that their performance as managers will be measured by reference to the extent to which
they do it conscientiously and well. Importantly, the rhetoric supporting performance
management must be converted into reality by the deeds as well as the words of the people
who have the ultimate responsibility for running the business.
Reviewing performance
Although performance management is a continuous process it is still necessary to have a
formal review once or twice a year. This provides a focal point for the consideration of key
performance and development issues. The performance review meeting is the means through
which the five primary performance management elements of agreement, measurement,
feedback, positive reinforcement and dialogue can be put to good use. It leads to the
completion of
the performance management cycle by informing performance and development agreements.
It involves some form of assessment, as considered in the next section of this chapter.
Overview of performance appraisal
• Can identify individual’s strengths & areas of development

• Can indicate how strengths can be utilised & weaknesses overcome
• Can help reveal problems that may be restricting progress
• Can develop a greater degree of consistency through regular feedback
• Can provide information for HR planning
• Can improve communications
Formal appraisal systems
Peer appraisal
useful as an element of a more comprehensive appraisal process, particularly in regard to
inter-personal criteria
Upward appraisal (by the leader’s line subordinates)
a particularly useful tool for appraising the effect of a manager’s leadership style on team
members
Internal customer appraisal
may be relevant in procurement and supply, to assess the quality of service and relationship
management provided to other departments
Appraisal by suppliers
may be particularly useful feedback, since it may be important for the organisation to maintain
‘good customer’ status with key suppliers
40

There is no common agreement on how to measure leadership effectiveness.
The Leadership Jigsaw
Cutler designed a questionnaire to measure the effectiveness of leadership

Cutler has designed a ‘jigsaw’ of best practice. There are six interlinking pieces: vision,
example, relationships, motivation, empowerment and communications as a guide to the
measurement and development of leadership skills. Cutler believes that leadership is not
such a difficult role if condensed to these essential elements and has devised a set of
questions to help aspiring leaders to find out if they have all the necessary pieces of the
jigsaw i.e. the necessary skills.
Balanced Scorecard
One way of measuring leadership effectiveness is the balanced scorecard.
They propose FOUR key perspectives to give a balanced view of performance.
Measures of leadership effectiveness

 The performance of the team or suppliers and supply chain for which the leader is responsible
 The motivation, commitment, loyalty and satisfaction of team members, suppliers and other
stakeholders
 The development and improvement of individual, team and/or supply chain capability and
performance over time
 Internal and external stakeholders’ awareness and understanding of the vision, goals and
objectives of the team, organisation or supply chain
 The effectiveness and ease with which change is introduced and maintained
 The quality of relationships, trust and communication
 The extent to which individuals, teams and suppliers respond flexibly to changing demands;
to exercise initiative and responsibility; and to develop and implement innovative solutions
Key components of leadership development programs
The experiential learning cycle - KOLB
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Leadership development is about action and reflection, and both are necessary in order to
develop critical skills such as analysis, strategic planning and critical consciousness. Without
space for reflection: "What did you learn from that experience?"; "In hindsight, what could you
have done differently?"— one's ability to lead will not evolve. Leadership development is also
about encouragement, recognizing that people frequently carry enormous insecurities about
being good enough, having enough experience, or having anything worthwhile to say and
doubting that others think they're capable enough. Hence, tipping points need to be created to
change people's dreams into purposeful action. Some people may have brilliant ideas, but if
they don't actualize them, they will be to no avail.
After identifying an individual's strengths and weaknesses, he or she can then embark on a
personal development plan. A personal development plan can be seen as a process through
which the individual prepares a training and development course of action, and takes
responsibility for its implementation. Essentially, the purpose of these programs is to increase
self-awareness and emphasize self-exploration. The relationship to leader development is
that leaders who are deeply in touch with their personal dreams and talents will act to fulfil
them. They will also be better prepared to lead others since their self-awareness leads to
greater awareness of the effects of their behaviour on others. The growing interest in values
such as authenticity, credibility, trustworthiness, and genuineness supports the contemporary
emphasis on a leader's emotional intelligence or the more affective component of leadership.
Leadership coaching/ mentoring
Leaders do much more than just come up with new ideas and approaches to problem solving.
They lead because they attract followers and are able to achieve great things through the
work of others. For this reason, a leadership development program effort needs to include the
mentoring and the training of prospective leaders in how to coach others, how to create
attractive performance goals, how to give performance feedback, motivate and inspire others
to excellence, and how to build a team (Kilberg, 2000)
Mentoring can be viewed as a long-term relationship in which a senior executive supports
the professional and personal development of a junior executive. Through this arrangement,
which can be either formal or informal, the junior executive acquires the skills necessary for
the next generation of leadership.
Executive coaching can be used to help leaders develop their coaching skills. Executive
coaching can be described as a helping relationship formed between a client who has
managerial authority and responsibility in an organization and a leadership coach who uses a
wide variety of behavioural techniques and methods to help the client achieve a mutually
identified set of goals to improve his or her professional performance and life satisfaction. It
can be viewed as a collaborative effort to better understand the challenges and constraints
the coachee is subjected to, while exploring new possibilities. To assist leadership coach and
coachee in discussing developmental areas, a coach may use multi-party feedback
assessments to help potential leaders understand their strengths and weaknesses while also
experiencing personal growth by bringing out emotions.
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2.3 Evaluate how to create a communication plan to influence personnel in the supply
chain
• How the use of the intranet and Internet websites for publishing information

• How to use the intranet and internet websites for publishing information
Internal stakeholders-members of the organisation: the directors, managers and employees

who operate within the organisation’s boundaries.
Connected stakeholders -have direct legal, contractual or commercial dealings with the
organisation.
External or secondary stakeholders -do not have direct contractual or commercial dealings
with the organisation, but have an interest in, or are affected by, its activities.
Primary and secondary stakeholder analysis

Primary (or market) stakeholders-internal and connected stakeholders, who
engage directly in economic transactions with the business.
Secondary (or non-market) stakeholders-external stakeholders who do not engage
in direct economic exchange with the business, but still affect and/or are affected by
its activities.
Key stakeholders-primary or secondary stakeholders who are identified as a priority
in a given situation or context, because of the opportunity or risk they present to the
organisation and its plans.
Stakeholder analysis and management

Identify Use individual or team brainstorming and consultation to identify who your
stakeholders are (in relation to the specific organisation, unit, plan or project
in focus).
Prioritise Map and classify stakeholders
Understand Analyse key stakeholder awareness, positions, interests and responses
(where possible, by direct consultation)
 Perspectives on stakeholder mapping
Mendelow’s power/interest matrix
43

The power/dynamism matrix- Gardner et al 1986
Dynamism=The extent to which their stance is open to change
Power /Dynamism Matrix classify stakeholders in relation to power that they hold and the
dynamism of their stance. The Power / Dynamism Map can be used to ascertain where
political efforts should be focused during the development of new stages. The stakeholders in
group A and B are the easiest to deal with. The stakeholders in group C are important,
because they are powerful. However their dynamism is low, so their stance is predictable and
their expectations can often be met in a relatively easy manner. Stakeholders in group D
should have the most management attention, because they are powerful and their stance is
difficult to predict. They can sometimes be dealt with by testing out new strategies with them
before final decisions are made.
Stakeholder salience-Mitchel et al 1997

Salience= the degree to which managers give priority to competing stakeholder claims
3 variables that determine it:
1. Power-the extent to which the
stakeholder is able to influence the
organisation’s actions
2. Legitimacy-the extent to which the
stakeholder has a legitimate interest in the
organisation’s actions
3. Urgency-the extent to which the
stakeholder’s interest or concern is time-
critical, and therefore the extent to which it is
prepared to be ‘demanding’ in pursuing its
claims or exercising its power
44

Mitchel proposed a classification of stakeholders based on power to influence, the legitimacy of
each stakeholders relationship with the organization, and the urgency of the stakeholders claim
on the organization. The results of this classification may assess the fundamental question of
“which groups are stakeholders deserving or requiring managers attention, and which are not?”
This is salience- “the degree to which managers give priority to competing stakeholder claims”
(Mitchell, Agle et al., 2007:854)
Assign stakeholders to one of eight categories:

1. Dormant stakeholders: These stakeholders have power to impose their will on others but they
miss legitimacy and urgency. Therefore their power remain dormant. Tip: keep these stakeholders
informed.
2. Discretionary (Latent) stakeholders posses legitimate claims, but have no power to influence
the organization nor urgent claims. Tip: Involve them only when really necessary (e.g. something
is going very wrong).
3. Demanding stakeholders: These stakeholders have urgent claims, but neither power nor
legitimacy to enforce them. Tip: Be careful not to invest too much time in keeping them up to
date. There are more important stakeholders to communicate with.
4. Dominant stakeholders have both power and legitimate claims in the organization giving them
strong influence in the project. Tip: Keep them informed.
5. Dangerous stakeholders have power and urgency, but lack of legitimacy. They are seen as
dangerous as they may resort to coercion and even violence. Tip: Keep these stakeholders
appropriately engaged or satisfied.
6. Dependent stakeholders lack power, but have urgent and legitimate claims. Tip: However,
they need to be managed because they can quite easily choose to align themselves with other
project stakeholders and hence influence your project.
7.Definite stakeholders have power, legitimacy and urgency, and therefore they need to be
communicated with.
8. Nonstakeholders have no power, no legitimacy and no urgency. Tip: Do not invest time in any
communication with them
• How to obtain buy in to supply chain strategies from stakeholde
Three ways to get stakeholders on board with procurement

The way procurement is viewed depends almost entirely upon the organisation it serves. For some
businesses, procurement shapes the company direction and has the ability to deliver cost leadership.
From the point of view of the marketing department, procurement can be a much more difficult
process and the relationship is often an antagonistic one. Stereotypically the two professions come
from completely different ends of the spectrum, with the marketing professional focusing on brands
and creativity while the procurement professional focuses on suppliers and return on investment.
Put simply, procurement has a lot of "making up" to do and is frequently accused by co-workers of
focusing too much on cost savings, working as gatekeepers, damaging creativity and negatively
impacting brand perception.
So, how do you get different stakeholder groups on board with the procurement department’s
business objectives? From working with our customers, I’ve found there are actions that can be
taken to ensure the department’s value is recognised internally:
1. Understand the business drivers

Just like all other departments, procurement is providing a service to its business. Therefore
relationships with internal stakeholders need to be managed just as much (if not more) as those with
45

external customers. To create better cross-functional relationships with other departments within
the business, procurement should carry out the following tasks:
• Ensure there is good knowledge of that department’s business objectives
• Understand the drivers that create value for each team
• Establish what “good” looks like in different parts of the business
2. Increase visibility of procurement activities
Procurement has moved on from its traditional role, focusing purely on cost saving. Today, the
department is continuously being challenged and set new key performance indicators (KPIs), such as
ensuring the organisation works with greener suppliers who meet sustainability requirements,
managing risk and encouraging supplier innovation.
Unsurprisingly, cost-savings is still argued to be its most accurate performance measurement. In fact,
when Xchanging questioned 830 procurement professionals about what KPIs they considered to be
most important to the success of their procurement operations, nearly half responded with
"delivering realised cost savings". But this often leads to procurement departments neglecting to find
metrics to measure their other successes, and in turn not being fully recognised as a strategic
partner to the business.
One approach that can be taken to increase the visibility of procurement activities is to consider non-
cost reduction innovations and benefits, and then label your team to address each one of these
challenges. For example:
• Risk managers
• CSR specialists
• Finance specialists
• International consultants
• Innovators
Procurement departments should then proactively open bi-directional conversations about how
procurement can support and add value to the different business units, capturing efficiencies and
sharing this information with all stakeholder groups.
3. Improve engagement with internal stakeholders
Around two-thirds of procurement decision-makers worldwide identify "internal stakeholder
engagement" as a challenge, with 14 per cent claiming it is an extreme challenge. Even more
worryingly, a "lack of internal engagement" is cited as the number one reason for targets not being
achieved.
The modern procurement practitioner needs to be able to build rapport with stakeholders, engage
with them, and communicate successfully in one-to-one and small group situations. To start with,
work on the team's communication and presentation skills so that you can speak with confidence
and precision - whether you’re talking to a stakeholder positioned above, below or beside you. Learn
to speak their language in order to gain influence. What’s important to them? What are their
challenges? How can you help?
Another step is for procurement to join meetings with senior stakeholders so it can align its activities
to the current strategy and the higher management gain an understanding of procurement
objectives (which should always be in line with the organisation’s objectives) and value-add. This in
turn increases internal procurement advocacy, and these stakeholders can then work with you to
ensure the right messages about procurement filter down through the business ranks.
Rivero,N,R. (2015) Three-ways-to-get-stakeholders-on-board-with-procurement
46

Noelia Gomez Rivero is new business manager at Xchanging Procurement
https://www.cips.org/en-GB/supply-management/opinion/2015/july/three-ways-to-get-
stakeholders-on-board-with-procurement/
Use The Kraljic matrix& Further analysis

Generic
 Force field analysis
 SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis
 Network diagrams (or actor influence diagrams)
General
 Goal analysis
 Desired outcomes
 Stakeholder marketing
 Relationship management
 Issues management
 Danger signals
Influencing customers
 Advertising, public relations and corporate identity messages
 Sales or trade promotions and other purchase incentives
 Personal selling, particularly in business-to-business markets
 Competitive or differential pricing strategies
 Competitive product and brand offerings
 Ease of availability and quality of service experience
Ownership of plans and decisions
 Employee and supplier selection and appraisal criteria
 Human resource and supplier development activities
 Governance and management structures
 Reward and incentive arrangements and sanctions or penalties for non-compliance
 Ensuring that strategies are adequately resourced
It is necessary to establish a formal, systematic plan for communication with
stakeholders, so that:
 The correct audience is identified and targeted
 All affected stakeholders are reached with the information
 Information is spread to the right people at the right time in the right way
 Information is spread efficiently and cost-effectively
 Information can be updated regularly where necessary
 Messages are coherent and consistent
 Confidential information is spread on a ‘need to know’ basis
 Inaccurate rumours and misinformation are neutralised as far as possible
 Opportunities are given to gather feedback
 The process is monitored and later reviewed
Why communication programmes fail
 Lack of planning
 Lack of resources allocated to the programme
 Lack of opportunity for questions, concerns, arguments or suggestions to be raised
by stakeholders
 Poor communication techniques
 Lack of managerial and cultural support for the message being communicated
 Political or cultural resistance to the message
•How the use of the intranet and Internet websites for publishing information
47

Benefits of intranets
 Supporting multi-directional communication and data-sharing
 Linking remote sites and workers in ‘virtual’ teams
 Allowing authorised access to shared database and e-procurement platforms
 Giving employees wider access to corporate information
 Encouraging more frequent use of reference sources and updating of information
 Saving on the costs of producing and distributing the equivalent printed documents
and messages
Benefits of extranets
 Assists in achieving improved supply chain integration via the use of online ordering,
order tracking and inventory management
 Reduces operational costs, for example by making manuals and technical
documentation available online
 Improved collaboration and relationship potential by enabling involved parties to work
online using common documentation
 Suppliers can directly access authorised business information
 Provides a single user interface between business partners
 Improved security of communications since exchanges take place under a
controlled and secure environment
Note
The methods of communication that could be discussed in the context of the case study that
Sean could use will include:
• Focus groups
• Meetings
• In-depth interviews
• Consultation forums
• Briefings, seminars
• Conferences
• Email
• Corporate website – intranets
Stakeholder communication plan
Generic Sections
 Introduction
 Stakeholder analysis – mapping using tools such as Mendelow
 Engagement strategy – how is stakeholder buy-in to be achieved?
 Influencing approach – which influencing tools and styles will work the best with each
different stakeholder group?
 Communications plan – what methods, electronic or otherwise are to be used to
communicate with stakeholders?
 Evaluation – setting of clear KPIs for the assessment of the success of the
communication plan.
Exam Analysis- past questions
Sections to be included in the plan:
 Key elements of information to send by the different mechanisms
 Level and frequency of communications required with stakeholders.
 Roles and responsibilities of key individuals/groups to ensure communication is
adequate, appropriate and timely.
 Identification of how variations of information will be handled within communication
plan.
 Levels of authority for staff for the issue of information.
 Checking and authorisation methods prior to release.
 Points of contact for queries on information within the procurement function.
 policies related to legal issues, disclaimers etc.
OR
 The main elements and outcomes that should be contained in a communication plan
include the following:
 A list of stakeholders – i.e. other oil companies, shipping companies, senior
management, logistics managers
48

 The different stakeholders will have slightly different expectations and requirements of the
communication plan
 Communication mechanisms – Meetings, conferences, email, circulars
 Key elements of the information to be distributed, level and frequency of communication
required – the scope of the items required to be transported by the shipping companies,
frequency of shipments, value etc.
 Roles and responsibilities of key individuals in implementing the communication plan –
this will be procurement and the other key stakeholders
 Contingency planning for unexpected information – this is a potential danger due to the
mistrust between the oil companies.
 Identification of the correct audience – senior management, shipping companies
 Efficiency and cost effectiveness considerations for the plan – need to identify a budget
for the activity and develop monitoring tools
 Coherent messages that are consistent in multiple channels –will need to ensure that the
message that is communicated regarding the project is consistent
 Identification and control of confidential information – some information such as
quotations from shipping companies will be commercially confidential
 Methodology for addressing misinformation and inaccurate rumour
 Feedback mechanisms –will need to provide feedback to unsuccessful bidders for the
contract
 Monitoring and review processes in terms of the communication plan –will need to assess
the success of the communication plan
 Information is spread cost effectively
 Information is regularly updated
49

3.0 Understand and apply methods to overcome leadership challenges faced by
procurement and supply chain managers
3.1 Contrast the sources of power and how they can be used to overcome common
challenges faced by procurement and supply chain leaders
• Perspectives on individual power
• Processual, institutional and organisational levels of power
• Perspectives on organisational power
• The balance between order and flexibility
Supply chain challenges - require use of power & Influence
 Securing co-operation for the implementation of change programmes
 Resolving stakeholder conflicts
 Maintaining quality standards and driving continuous improvement
 Introducing cost reduction initiatives
 Raising ethical, labour and environmental standards in the supply chain
 Securing internal compliance with procurement policies and disciplines
 Securing supplier compliance with policies and standards
 Challenging business need and user specifications to minimise wastes
 Asserting the strategic value, role and status of the procurement function in the
organisation
 Stimulating supply market innovation.
Power is processual:
It emerges out of processes of daily interaction in organisations (and supply chains): how
power is gained and used in the ongoing ‘game’ of developing and implementing strategy.
Processual power focuses on the ‘micro-politics’ of organisational life. It stresses power as
negotiation and bargaining, and the ‘enactment’ of rules and how resources are employed in
the power game.
Power is institutional:
radical theories of power, such as Marxist theory, insist that ultimately power is constituted in
social and economic structures and institutions, external to the organisation. When managers
seek to exercise power they can draw on a set of institutionally produced rules such as
cultural beliefs about the right to manage.
Power is internal or organisational:
The organisational level stresses the organisation’s own power system and the hierarchy as a
means of reproducing power. Dominant beliefs, values and knowledge shape organisational
priorities and solutions or reflect the interests of particular groups or functions.
Those in authority select others to sustain the existing power structure. Organisational
hierarchies transmit power between the institutional interests and the rules and resources
governing action.
50

Forms and uses of power
 Overt power-obvious, or transparent – through direct tactics such as physical or
economic coercion, autocratic leadership, logical persuasion or the offering of
incentives
 Covert power-subtle, hidden or implied – through indirect tactics such as withholding
information or excluding someone from a negotiation or network
 Structural power-built into the situation, context or relationship
JRP French and BH Raven identify:
Reward power: based on the ability to allocate desirable outcomes-out of the authority
that a person has to recognise and reward people. Ways to do this can be by salary
hikes, bonuses, paid leave, company sponsored vacation or even promotions. i.e.
increased business or shared benefits from cost reductions
Coercive power: based on the distribution of undesirable outcomes-Coercive power is

used to enforce strict deadlines and punishable actions in the workplace and scare
employees. i.e. such as decreased business or dictated cost reductions
Legitimate power:(or positional power) is the power that a person in the organization
holds because of his/her position and that is considered to be legitimate. A manager who
leads a team has certain responsibilities and also the right to delegate tasks/her to his
subordinates as well as review their work and give feedback.
Referent (or charismatic) power: possessed by someone who is highly admired -is the
ability to convey a sense of personal acceptance or approval. It is held by people with
charisma, integrity, and other positive qualities. It is the most valuable type of power. i.e.
in supply chains implies that one firm desires identification with another for recognition
by association
Expert power: derives from the possession of expertise, knowledge, and talent i.e. the
perception that one firm holds information or expertise (such as product or
process leadership) that is valued by another firm.
In 1965 Raven revised this model to include a sixth form by separating the
informational power base as distinct from the expert power base This is providing
information to a person that results in them thinking/acting in a different way.
Information by itself may not be enough for this and may hence be supported by an
argument as to why the information should be believed. If the information is
accepted then 'socially independent change' occurs as the person continues to
believe this information to be true and acts accordingly. Informational Power is the
most transitory type of power. Once you give your information away, you give your
power away. For example, you share the secret, your power is gone. It’s different
from other forms of power because it’s grounded in what you know about the
content of a specific situation. Other forms of power are independent of the
content.
Source Type Influence on others

Coercive power Position The ability to impose sanctions or punishment to
gain compliance
Reward power Position The ability to provide rewards or recognition to gain
compliance
Legitimate power Position The right to influence the activities of others based
on job title or position
51

Expert power Personal Respect gained based on skills, expertise or
experience
Referent power Personal Positive personal traits or integrity
Information power Position and Possession of or access to, valuable information
personal
Connection power Position and Access to others who can provide rewards or
personal sanctions
Positive uses of power -examples
 Expert power may be used to develop and empower suppliers and supply chains
 Referent power may be used to share and benchmark best practice standards,
and to secure supply chain emulation of the buyer’s sustainability standards
 Reward power may be used to exercise responsible influence over the supply
chain, to secure compliance with desired sustainability standards
 Reward power may be used to develop required capabilities and sustainability

standards in the supply chain
 Reward power may be exercised responsibly by the buying organisation through

fair and sustainable pricing, rather than price leverage
Negative consequences
 Disempowering suppliers
 Squeezing suppliers’ profit margins
 Forcing suppliers to pursue unsustainable practices
 Passing ‘top-down’ pressures down the supply chain
 Robbing the buying organisation of the potential benefits of supply chain input
 Stimulating scrutiny from regulatory bodies, media and pressure groups
Other researchers have added:
 Connection power
 Informational power
 Negative power
Staff authority-the term given to the expert power of a specialist giving advice or guidance
to others, even though he has no direct line authority over their activities
Functional authority -the term used where an expert is given legitimate authority to direct
the activities of others in the area of his expertise
Organisational sources of power-Mullins

SOURCES OF POWER INDICATORS OF POWER
Within • Hierarchy Status

organisations • Influence Claim on resources
• Control of strategic Representation
resources Symbols
• Possession of
knowledge and skills
• Control of human
environment
• Involvement in
implementation
For external • Control of strategic Status
52

stakeholders resources Resource dependence
• Involvement in Negotiating arrangements
implementation Symbols
• Possession of
knowledge and skills
• Through internal links
Pfeffer has identified a number of critical ways in which individuals or groups may acquire
power in organisations when viewed as social entities:
 providing resources – for example money, prestige, legitimacy, rewards and sanctions,
and expertise that create a dependency on the part of other people;
 coping with uncertainty – the ability to permit the rationalisation of organisational
activity, for example through standard operating procedures, or to reduce uncertainty or
unpredictability;
 being irreplaceable – having exclusive training, knowledge or expertise that cannot
readily be acquired by others, or through the use of or lack of adequate documentation or
specialised language and symbols;
 affecting decision processes – the ability to affect some part of the decision process, for
example by the basic values and objectives used in making the decision, or by controlling
alternative choices;
 by consensus – the extent to which individuals share a common perspective, set of
values or definition of the situation, or consensus concerning knowledge and technology
The balance Between Order and Control in Organisations
Control in organisations
Stewart refers to the classic dilemma that underlies the nature of control: finding the right balance
for present conditions between order and flexibility. This involves the trade-off between trying to
improve predictability of people’s actions against the desirability of encouraging individual and
local responsiveness to changing situations. The organisation may need a ‘tight–loose’ structure
with certain departments or areas of work closely controlled (‘tight’); whilst other departments or
areas of work should be left fluid and flexible (‘loose’).59
Three main forms of control According to Stewart, ‘Control can – and should – be exercised in
different ways.’ She
identifies three main forms of control
■ Direct control by orders, direct supervision and rules and regulations. Direct controls may be
necessary, and more readily acceptable, in a crisis situation and during training. But in
organisations where people expect to participate in decision making, such forms of control may
be unacceptable. Rules and regulations which are not accepted as reasonable, or at least not
unreasonable, will offer some people a challenge to use their ingenuity in finding ways round
them.
■ Control through standardisation and specialisation. This is achieved through clear definition of
the inputs to a job, the methods to be used and the required outputs.
Such bureaucratic control makes clear the parameters within which one can act and paradoxically
makes decentralisation easier. Provided the parameters are not unduly restrictive they can
increase the sense of freedom. For example, within clearly defined limits which ensure that one
retail chain store looks like another, individual managers may have freedom to do the job as they
wish.
■ Control through influencing the way that people think about what they should do. This is often
the most effective method of exercising control. It may be achieved through selective recruitment
53

of people who seem likely to share a similar approach, the training and socialisation of people into
thinking the organisation’s way, and through peer pressure. Where an organisation has a very
strong culture, people who appear to leave of their own volition.
Stewart also refers to a second, related dilemma of finding the appropriate balance between
centralisation, as a means of exercising control, and decentralisation.
 Direct control-Eg using orders and instructions, direct supervision, rules and regulations
 Standardisation and specialisation (bureaucratic control or planning systems)-clear

definition (or programming) of the parameters for action
 Influencing-shaping the way that people think about what they should do, and bringing
their values into line with those of the organisation
Other Methods
 Performance targets and KPIs-the performance of the organisation is evaluated

according to its ability to meet defined targets
 Self control- personal motivation is used to influence the quality of employee input and
conduct (control), without direct intervention (flexibility)
TOM PETERS’ SEARCH FOR AN EXCELLENCE MODEL
In their book In Search of Excellence, McKinsey consultants Tom Peters and Robert Waterman found
8 common themes which they argued were responsible for the success of 14 identified companies of
“excellence.” The framework is known as the 8 Attributes of Management Excellence. The research
and theorizing of this framework was based on the McKinsey 7-S Model, also authored by Peters and
Waterman.
Peters and Waterman identified the following eight attributes which characterized the
excellent, innovative companies in their study (op cit p. 13-16):
1.A bias for action, meaning that although companies’ approach to decision making may be
analytical, they emphasize the importance of experiments. It is believed that too many detailed
analyses may be barriers against problem solving. Thus their approaches to solve problems and
challenges are often experimental and dealt with immediately or in a relatively short time
through establishment of cross functional teams where also external partners like customers or
suppliers may participate.
54

2.Close to the customer, meaning that the successful companies really listen to the voice of
the customer and also use the voices as input for continuous improvements and new product
and service development.
3.Autonomy and entrepreneurship, meaning that all employees - not only people in R & D - are
expected to be creative and innovative in their daily jobs.
4.Productivity through people, meaning that people are expected to come up with ideas for waste
reductions and productivity growth by providing the proper framework i.e. respect, involvement and
empowerment.
5.Hands-on, value driven, meaning that the company’s philosophy, vision and values are seen as the
main guideline and to be far more important than technological or economic resources for
the daily activities and challenges.
6.Stick to the knitting, meaning that the excellent companies stay close to the business they know.
7.Simple form, lean staff, meaning that the underlying structural forms and systems in the
excellent companies are elegantly simple and top-level staffs are lean.
8.Simultaneous loose-tight properties, meaning that the excellent companies are both centralized
and decentralized. On the one hand for example they have pushed autonomy down to the shop floor
or product development teams, and on the other hand, they are fanatic centralists around the few
core values they hold dear.
Peters and Waterman complemented the above eight attributes with the following
overall conclusions (op cit p. 13): The excellent companies were, above all, brilliant on the
basics. Tools didn’t substitute for thinking.......Rather, these companies worked hard to keep things
simple in a complex world. They persisted. They insisted on top quality. They fawned their
customers. They listened to their employees and treated them like adults
Critique
Managers may misunderstand that the shown characteristics are exhaustive, and they may
not understand the interrelationships and logical linkages between them, as the lists mixture various
elements together and does not provide a proper guiding framework. It is also important to
understand that the best practices in the list may not always be a “good medicine” for an
organization and hence the lists may both be misleading or biased and risky for companies to
apply.
55

https://flevy.com/blog/how-do-you-achieve-management-excellence/
3.2 Analyse how equality and diversity issues relating to the supply chain can be used
to improve strategic effectiveness
• Defining diversity, equality and inclusion
• The benefits of diversity in organisations
• The impact of discrimination, harassment and victimisation
• Developing and implementing policies to enhance diversity
We define Equality, Diversity & Inclusion as follows:
 Equality means treating people equally

 Diversity means recognising, encouraging and accommodating differences
 Inclusion, in both a social and educational context, means recognising every
individual’s right to be treated equally, and to be accorded the same services and
opportunities as everyone else.
Diversity: Diversity literally means difference. Diversity recognises that though people have
things in common with each other, they are also different and unique in many ways. Diversity
is about recognising and valuing those differences. Diversity therefore consists of visible and
non-visible factors, which include personal characteristics such as background, culture,
personality and work-style in addition to the characteristics that are protected under
discrimination legislation in terms of race, disability, gender, religion and belief, sexual
56

orientation and age.By recognising and understanding our individual differences and
embracing them, and moving beyond simple tolerance, we can create a productive
environment in which everybody feels valued.
Equality enables us to create a fairer society where everyone can participate and has the
opportunity to fulfil their
potential. Equality is backed by
legislation (Equality Act 2010)
which is designed to address
unfair discrimination,
harassment, and victimisation,
to advance equality of
opportunity, and to foster good
relations between people who
share a protected characteristic
and those who do not.
However, this is everyone’s
responsibility as well.
There are nine protected

characteristics:
1. Age
2. Disability
3. Gender assignment
4. Marriage and civil partnership
5. Pregnancy and maternity
6. Race
7. Religion and belief
8. Sex
9. Sexual orientation.
Diversity is when we recognise and value difference in its broadest sense. It is about
creating a culture and practices that recognise, respect, value, and embrace difference for
everyone’s benefit.
Inclusion refers to an individual’s experience within the workplace and in wider society, and
the extent to which they feel valued and included.
Equality, Diversity and Inclusion are different things and they need to be progressed together.
Equality of opportunity will only exist when we recognise and value difference and work
together for inclusion.
Real World Examples
Impact
 Engage with key contractors to agree appropriate Equality, Diversity and
Inclusion targets to meet the principles of our Equality and Diversity Strategy.
Procurement
In respect of our procurement activities:
 We will endeavour to ensure that the purchase of goods, services and facilities is
undertaken in line with our equality and diversity commitments.
 We will endeavour to use suppliers who share our values on equality of opportunity
and diversity;
57

 We will endeavour to establish procedures to ensure that businesses from diverse
communities have an equal opportunity of competing for collaborative procurement
contracts to supply goods and services to BACP.
 We will endeavour to influence our external operations to ensure that they are
inclusive and uphold the principles of equality and diversity mindfulness within the
operational aspect of these functions.
Diversity competency
 Fostering an environment of inclusion of people who have different characteristics
 Learning from individuals, teams or organisations with different characteristics
and perspectives
 Developing awareness, attitudes and behaviours that support diversity in the
workplace
 Demonstrating commitment to work with team members and value their
contributions, regardless of personal attributes or differences
Implementing an effective diversity policy
 Analysing the business environment, to determine how far the organisation
reflects the population and the customer base
 Carefully defining diversity and its business benefits
 Appointing equal opportunities champions at a senior level, and ensuring that
diversity values are included in corporate strategy
 Establishing a representative working party to formulate policies and codes of
practice
 Communicating and promoting the policy
 Supporting implementation of the policy through HR processes
 Monitoring and benchmarking progress at regular intervals
Benefits of diversity
 Widening the recruitment pool
 Performance benefits of being able to draw on people with diverse skills, experiences
and viewpoints
 Reflecting the diversity of external stakeholders
 Benefits for staff morale and performance
 Enhanced customer satisfaction and loyalty
 Enhanced employer brand
 Compliance with equal opportunities legislation and codes of practice
 Enhanced flexibility and learning
Drawbacks
 Burdens and costs of formulating and administering diversity policies and practices
 Difficulties of managing and communicating effectively in ethnically diverse teams
 Difficulties and costs of managing a workforce with increasingly diverse family
structures and responsibilities
 Confronting issues of literacy, numeracy and differences in different nations’
qualification and training schemes
 Adapting the work environment, processes and task organisation to support
contribution from disabled employees
 Potential for misunderstanding, miscommunication and conflict
Supplier diversity-Supply base diversity can:
 Support strategic alignment, by ensuring that the supply base reflects the increasing
diversity of the customer base
 Help build stakeholder relations and generate goodwill
 Support corporate image and reputation by demonstrating commitment to equality
and inclusion
 Contribute to improved supply chain performance: a wider pool of suppliers can
generate competition and innovation
Improving supplier diversity
 Removing barriers to participation in competing for contracts
 Positive action supplier diversity programmes, whereby suppliers in certain under-
represented groups are targeted to offer opportunities to compete for contracts
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 Encouraging or requiring suppliers to have diversity policies in place for their own
supply chains
Steps to Implement Supplier Diversity

1. Carry out a review and audit process to measure current suppliers against the
organisation’s values and diversity strategies and policies.
2. Carry out training and communication to clearly state the organisation’s diversity values
and expectations to employees, procurement staff, and existing and prospective
suppliers.
3. Practice inclusive procurement to ensure that barriers to tendering are removed, such
as, where possible, reducing minimum turnover requirements.
4. Consider what resources are required to achieve diversity success. And,
5. Ensure diversity goals and metrics are signed off by the CEO or CPO, to implement
diversity programs effectively.
Leading diverse teams

 Acknowledging cultural conflicts when they arise and encouraging mutual learning
 Identifying and focusing on shared values and common ground
 Clarifying expectations and gaining commitment to the group’s shared goals and
objectives
 Identifying individual interests, strengths and preferences, and showing appreciation
and respect for different cultural contributions
 Flexibly exploring culturally appropriate ways of team building and rewarding
excellence
 Being sensitive to power imbalances and supporting all-member contribution
 Facilitating communication and feedback processes
Practical ideas for managing diversity

1 Test assumptions about people before acting on them
2 Ensure that organisational discipline and grievance policies are clearly understood
3 Make sure that diversity policies are understood and acted upon
4 Maintain open channels of communication to try to locate possible issues before they
become problems
5 Learn how to understand the views of all staff members and encourage open
approaches
6 Be prepared to listen to varying methods of solving work-based problems
7 Learn about and have regard to any strongly held beliefs that are held by individuals
8 Acknowledge all contributions to improving working environments and processes
9 Know your own cultural diversity biases –and work at not letting them affect the
workplace
10 Take care that any workplace based social events can be enjoyed by all workers
Jan 12 Q6 Propose a range of approaches for managing equality and diversity effectively
in a purchasing function
This question was expected to include;
 a contextualisation of an answer in a purchasing environment
 Approval of an equality and diversity policy
 Publication of this policy using the appropriate communication delivery channels
 Communication of this policy throughout the organisation, and in particular within the
purchasing function
 Awareness training for all employees
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 To ensure understanding of the benefits of equality and diversity for all purchasing
employees and their key stakeholders
 Ongoing monitoring and review by key staff
 Inclusion of all employees in key activities, for example in target setting and
development planning
 To undertake regular compliance audits across the purchasing and other key
functions
 Inclusion of these policies in all appropriate supplier’s policies and/or supplier

evaluation/appraisal procedures
Expectation that all purchasing managers fully and genuinely embrace and apply these
policies
3.3 Evaluate methods of change management that can be used to develop the supply
chain
“It is not necessary to change. Survival is not mandatory”. W. Edwards Deming
Triggers for change- p140 guide

 Poor performance
 The presence of entrepreneurs, new senior management or other innovators who act as
evangelists (leaders) for more modern approaches
 Changes in, or re-ordering of, organisational goals, processes and structures
 Favourable changes experienced in the past
 Changes in knowledge or resources
(Titchy lists 4 main causes of strategic change-environment, business relationships, technology

and people). Kanter, Stein and Jick identify 3 dynamics for strategic change- environment,
lifecycle differences and political power changes)
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There is a danger in thinking that there is only one way, or one best way, to change
organisational strategies. This is not so… quite typically strategy development is incremental
in nature. It builds on prior strategy; it is adaptive min the way it occurs, with only occasional
more transformational changes develop this further to identify four types of strategic change
and these have implications for how change might be managed.
Arguably, it is beneficial for the nature of change min an organisation to be incremental. In
this way it will build on the skills, routines and beliefs of those in the organisation, so that
change is efficient and likely to win their commitment. A‘big bang’ approach to change might
be needed on occasions, for example if the organisation is facing crisis or needs to change
direction very fast. In terms of the scope of the change process, the issue is whether it can
occur within the current paradigm (i.e. current organisational beliefs and assumptions). This
can be thought of as a realignment of strategy rather than a fundamental change of strategic
direction. Or does it require paradigm change?
This is more transformational change. Combining these two axes shows that there are four
types of strategic change:
Emergent change
allowed to develop naturally, often from the bottom up, in response to environmental
influences
Planned change
involves deliberately formulated strategies and programmes for implementing change
Incremental (or evolutionary) change is often used as a proactive approach, building on the
existing improvement strategies such as Kaizen (continuous improvement) and total quality
management. Because it requires only realistic, small operational improvements and
elimination of wastes, it can be implemented from the ‘bottom up’, involving employees
through suggestion schemes, quality circles and self-improvement plans.
Transformational (or revolutionary) change is often a reactive approach, responding to
‘disruptive’ change, crisis or the need for a completely new paradigm. It seeks to overthrow
the status quo and introduce radical transformation in a relatively short period of time.
Because it requires discontinuous and sweeping change across organisational structures and
systems, it can only be implemented from the ‘top-down’ with top management vision and
leadership. Although it requires heavy investment, and some risk, it can achieve
transformative improvements.
Contextual features ( factors) and their influence on strategic change

Programmes – Johnson & Scholes
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There is no one right ‘formula’ for the management of change. The success of any attempt at
managing change will be dependent on the wider context in which that change is taking place.
Take an obvious example. Managing change in a small, perhaps relatively new, business,
where a motivated team are themselves driving change, would be quite different from trying to
manage change in a major corporation, or perhaps a long-established public sector
organisation, with established routines, formal structures and perhaps a great deal of
resistance to change. The contexts are completely different and the approach to managing
change therefore needs to be different
Change kaleidoscope- Balogun Hope & hailey- model for conceptualising the change
Pulling this together, the questions that emerge are these:

 Does the organisation in question have the capacity, capability, readiness and power
structures to achieve the scope of change required? For example, in a study of attempts
to manage change in hospitals it was found that their governance and organisational
structures prevented any clear authority to manage change. This, combined with the
resource constraints they laboured under, meant that major one-off change initiatives
were not likely to succeed.
 How does the context inform the choices about the means by which change can be
managed? These choices about means are reviewed later in the chapter.
 Does the context need to be changed before the strategic change itself can occur? For
example, it could be that new management with experience of managing change need to
be introduced to enhance the capability and readiness for change to get the organisation
to a point where it is ready to embark on a more significant strategic change programme.
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Or that people with a greater diversity of experience in line with the future strategic
direction need to be brought in.
 Or perhaps it needs to be recognised that in some contexts change has to be managed in
stages. The researchers in the hospital study reported above found that change tended to
take place by one initiative making limited progress, then stalling, followed by a later one
making further advances
Conditions favourable to change

 Financial viability and stability
 Adaptable (or ‘organic’) organisation structures
 Good multi-directional communication systems, and systems for formal and informal
negotiation and consultation
 Vision, leadership and support from senior management
 Supporting HR systems and procedures
 Supportive culture and attitudes
A forcefield analysis provides an initial view of change problems that need to be tackled, by
identifying forces for and against change. It allows some key questions to be asked:
 What aspects of the current situation might aid change in the desired direction, and
how might these be reinforced?
 What aspects of the current situation would block such change, and how can these
be overcome?
 What needs to be introduced or developed to aid change?
Change objectives
 They must be aligned or integrated: both vertically and horizontally
 They must be effectively formulated
 They should – where possible – be formulated with the participation or at least the
agreement of key stakeholders
 They should be flexible
Aims of consultation and engagement
 To allow the views and needs of stakeholders to be taken into account
 To develop change objectives and processes that are likely to be accepted or
supported by stakeholders
 To ensure accountability for change decisions which affect stakeholders
 To enhance the quality of change plans through information inputs from expert and
involved stakeholders
 To provide for issues management
 To provide for crisis management
Many frameworks for designing change programmes have started from the position that
breaking down cultural inertia and overcoming resistance to change are key requirements for
putting strategy into action. Some argue that there is a need to ‘unfreeze’ the organisation
before a new strategy can be followed;
and that this involves challenging the prevailing paradigm so that inertial constraints on
following a new strategy are reduced. The organisation will therefore go through processes
of change in which the mechanisms discussed in this part of the book may play a part.
A change in the environment of the organisation – new technology, changes in customer
tastes, or the entry of new competitors leading to a deteriorating market position – may act as
an unfreezing mechanism. However, in the absence of a clear and dramatic external force
for change, there may be other ways to achieve the unfreezing process. Managers may
emphasise, even exaggerate, external signs of problems or threats, make structural changes,
set up different control systems, remove long-established management or switch resources to
different priorities as ways of signalling that existing ways of doing things are under challenge.
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There may develop a situation of flux in the organisation, in which competing views surface
about causes of, and remedies for, the problems. It is likely to be a time of high political
activity. Not least, there is likely to be a defence of boundaries and investment in resources,
perhaps controlled by functional departments.
The way forward might be resolved by planned strategic direction coming from the top. Or it
may be that individuals or groups within different parts of the organisation start to try new
ways of doing things – a process of experimentation. This might be because a change agent
is deliberately using a change style of participation or intervention or perhaps because people
in a department see themselves potentially benefiting from structural change in the
organisation. The result could be that there is growing commitment to a new strategy
direction. It might also mean that managers trying to instigate the new strategy learn from
such experiments and refine the strategy they had planned.
Members of the organisation, faced with a new strategy, may require a ‘safety net’for the
future.
Refreezing processes may be needed to confirm the organisational validity of the new
strategy, so managers may need to consider ways of signalling this: for example, by changing
organisational structures ,investment in resource areas central to that strategy by changing
everyday routines or by symbolic signalling of the changed strategy.
Eight components of planned change frech kast rosenzweig 1985
Kotter’s 8-stage Change Management Process

1. Establish a Sense of Urgency
Often employees do not take the need for change seriously enough; the organization is often
very complacent. The effective change leader will educate the organization about the urgent
need for change and the consequences of sticking to the status quo.
2. Create a Guiding Coalition
The change leader should assemble a group of people who support the need for change and
have enough institutional clout to make change happen; the task is then to get this coalition to
work together as a team.
3. Develop a Vision and Strategy
A change leader needs to present a picture (or vision) of what the organization will look like
after the change and to propose strategies to move the organization to this ideal state. The
goal of the vision is to get employee buy-in, so employee participation in articulating the vision
is useful.
4. Communicate the Change Vision
The change leader must coordinate a communications effort that broadcasts the new vision
and strategies. Management must communicate the vision of change to all relevant
employees to further develop buy-in. Kotter believes that the guiding coalition should “model
the behaviour expected of employees.”
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5. Empower Action
Management should remove barriers that impede change. Employees should know that
acting in accord with the vision will be rewarded. Risk taking should be encouraged.
6. Generate Short-Term Wins
By breaking up the desired change into smaller steps, change leaders can create a feeling of
progress as well as opportunities to reward employees for success. This progress should be
communicated widely so it is recognized throughout the organization that change is
happening.
7. Consolidate Gains and Produce More Change
Change leaders can use the increased credibility that comes with early “wins” to alter
whatever in the organization doesn’t fit the vision. Recruiting and promoting those who can
advance the change process (or perhaps even help lead it) is vital in continuing progress.
8. Anchor New Approaches in the Culture
Emphasizing the benefits of the change effort, and linking it to organizational success, is one
way to help anchor the new approach. The idea is to have new practices replace the old
culture. (This final step takes time; it comes last in the transformation process).
Reasons for resistance to change
INDIVIDUAL RESISTANCE ORGANISATIONAL RESISTANCE
Selective perception, leading to biased views Organisational culture: strong norms and
of the situation values establishing the status quo
Habit, providing ease, comfort and security A desire to maintain stability and
Inconvenience, loss of control or reduced predictability
freedom of action Resource requirements and priorities
Economic implications of change for pay, Past and existing contracts and agreements
rewards or job security Threats to the power or influence of interest
Nostalgia: value and security in the past, groups
tradition, ‘tried and tested’ ways Blaming culture
Fear of the unknown and insecurity
Factors affecting response to change

 Facts-what is known about the reasons for change, the change process and likely
outcomes of the change
 Beliefs -whether individuals believe that change is necessary and potentially beneficial,
that they have the resources to cope and so on
 Feelings-emotional responses to the process or proposed outcomes of change
 Values-the individual’s positive and negative moral judgements around change, or
specific change objectives
Dealing with resistance to change
Kotter and Schlesinger (2008).
 Education and commitment:

 Participation and involvement:
 Facilitation and support:
 Negotiation and agreement:
 Manipulation and co-optation:
 Explicit and implicit coercion
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Facilitation -involves assisting stakeholders to change
Support -involves helping stakeholders to come to terms with the change psychologically
INCREMENTAL CHANGE TRANSFORMATIVE CHANGE

Collaborative/ Participative evolution Charismatic transformation
Consultative strategy strategy
style Use when: Use when:
• The organisation needs • The organisation needs
minor adjustment to major adjustments to
environmental environmental
conditions conditions
• Time is available for • There is little time for
participation participation
• Key interest groups • There is support for
favour change radical change
Directive/ Forced evolution strategy Dictatorial transformation
Coercive Use when: strategy
style • The organisation needs Use when:
minor adjustments • The organisation needs
• Time is available for major adjustments
participation • There is no time for
BUT participation
• Key interest groups • There is no internal
oppose change support for strategic
change
BUT
• Change is necessary for
survival

Mayo’s three elements of cultural change
1. Top management vision and determination
2. Education and communication
3. Supporting systems and processes
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When it comes to considering strategic change, there is too often an overemphasis on individuals
at the top of an organisation. It is useful to think of change agency more broadly. A ‘change
agent’ is the individual or group that helps effect strategic change in an organisation. For
example, the creator of a strategy may, or may not, also be the change agent. He or she may
need to rely on others to take a lead in effecting changes to strategy. It could well be that a middle
manager is also change agent in a particular context. Or it may be that there is a group of change
agents from within the organisation or perhaps from outside, such as consultants, who have a
whole team working on a project, together with managers from within the organisation. So change
agency does not necessarily correspond to one individual.
Skills and attributes of an effective change agent

 Vision and leadership
 Team building skills
 Interpersonal skills
 Personal flexibility
 Commitment, perseverance and stamina
Advantages of external change agents

 They are more likely to be objective and dispassionate
 They may better represent the interests of other stakeholders in the change process
and outcomes
 They are better able to ask questions and perform analyses which challenge the
status quo and its constraints
 They may have technical expertise which in-house managers lack
 They are dedicated to the change programme
 They represent a significant, focused investment in change
Most important aspects of successful change- Hans-Henrik Jorgensen, Oliver
Bruehl and Neele Franke (2015) Making Change Work , Institute For Business Value,
 Top management sponsorship
 A shared vision
 Corporate culture that motivates and promotes change
 Honest and timely communication
 Ownership of change by middle management
 Employee involvement
 Change agents (pioneers of change)
 Efficient structure and roles within organization
 Skill-set of project team
 Efficient training programs
 Adjustment of performance measures
 Monetary and non-monetary incentives
 Focus on project management tasks
 Regular status reports to management
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3.4 Assess methods for resolving conflict with internal and external stakeholders to
support change in the supply chain
• The positive and negative outcomes of conflict
• Incremental and transformational change
• A development of the systems approach

• Takes the view that there is no one best universal structure
• A range of situational factors influence organisational design & performance
• Emphasises the need for flexibility
See contingency management in section 1
Group relationships and norms of behaviour exist outside the official structure and the
informal organisation may, therefore, be in conflict with the aims of the formal organisation. A
summary of differences between the formal and the informal organisation is given in Table
4.2.
Nature of Informal organisations

 Social networks and groups, often cutting across the boundaries of units established by
the formal organisation
 Informal ways of getting things done, often different from the formal rules and procedures
of the organisation
 Informal communication networks, often by-passing formal communication channels.
 Informal power structures, often different from the formal position-based scalar chain of
command or hierarchy of authority
 Personal and collective values, feelings and behavioural norms
The informal organisation can serve a number of important functions.
•It provides satisfaction of members' social needs, and a sense of personal identity and belonging.
•It provides for additional channels of communication - for example, through the 'grapevine'
information of importance to particular members is communicated quickly.
•It provides a means of motivation - for example, through status, social interaction, variety in routine or
tedious jobs, and informal methods of work.
•It provides a feeling of stability and security, and through informal 'norms' of behaviour can exercise a
form of control over members.
•It provides a means of highlighting deficiencies or weaknesses in the formal organisation - for
example, areas of duties or responsibilities not covered in job descriptions or outdated systems and
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procedures. The informal organisation may also be used when formal methods would take too long, or
not be appropriate, to deal with an unusual or unforeseen situation.
Reasons for informal organisation
There are many reasons for the informal organisation, including.
•individuals' goals may differ from the organisations - workers with the same goals gravitate
together.
•personal relationships may arise between individuals.
•a group of individuals may share common interests, e.g. football and so form an informal
group.
•certain members of the organisation may be natural leaders and so lead a group, even
though they have no formal managerial place.
•workers find new ways of doing things which save them time.
•Advantages and disadvantages of informal organisation
Advantages
If managers can work with the informal groups within their department, there should be higher
levels of motivation and productivity.
Interdivisional communication should be better through the informal network. This could lead
to increased innovation which should help the company succeed.
Disadvantages
If the formal structure is in conflict with the informal structure, the organisation may end up
being inefficient at meeting its objectives. This can arise due to, e.g. formal lines of
communication being blocked as informal lines of communication are more efficient and
become more important.
If managers try to implement change, they may find opposition from not only the formal but
also the informal organisation e.g. change in one division, may lead to companywide unrest
as word of the changes spread through the informal network, and other divisions start to be
concerned that 'they will be next' (the grapevine effect).
The impact of the informal organisation on the business
The informal organisation can either enhance or hold back the business. Managers need to
be aware of the informal structure and ensure that they:
•adapt the formal structure to complement the informal one.

•maintain a looser formal structure so that the informal structure can thrive.
•at the very least take account of the informal structure in decision making
Organisational political strategies
 Contracting
 Co-opting
 Forming networks and coalitions
 Influencing decision criteria
 Controlling information
 Coercion and pressure tactics
 Rule making
AS IS FOR
FORMAL ORGANISATION INFORMAL ORGANIZATION
COMPARISON
Meaning An organization type in which the An organization formed within the

job of each member is clearly formal organization as a network of
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AS IS FOR
FORMAL ORGANISATION INFORMAL ORGANIZATION
COMPARISON
defined, whose authority, interpersonal relationship, when

responsibility and accountability people interact with each other, is
are fixed is formal organization. known as informal communication.
Creation Deliberately by top management. Spontaneously by members.
Purpose To fulfill, the ultimate objective of To satisfy their social and

the organization. psychological needs.
Nature Stable, it continues for a long time. Not stable
Communication Official communication Grapevine
Control Rules and Regulations Norms, values and beliefs

mechanism
Focus on Work performance Interpersonal relationship
Authority Members are bound by hierarchical All members are equal.

structure.
Size Large Small
• The positive and negative outcomes of organisational conflict
Conflict may be defined as a:

"sharp disagreement or opposition" and includes "the perceived divergence of interest, or a
belief that the parties' current aspirations cannot be achieved simultaneously" (Pruitt and
Rubin, 1986).
Conflict is not necessarily a bad thing, however. Properly managed, it can arguably have
potentially positive outcomes. It can be an energising and vitalising force in groups and in the
organisation. Conflict can be seen as a 'constructive' force and in certain circumstances it can
be welcomed or even encouraged. For example, it can be seen as an aid to incremental
improvement in organisation design and functioning, and to the decision-making process.
Conflict can be an agent for evolution, and for internal and external change. Properly
70

identified and handled, it can help to minimize the destructive influences of the win-lose
situation.
From a survey of practicing managers, who reported that they spend approximately 20 per
cent of their time dealing with conflict situations, Schmidt records a number of both positive
and negative outcomes of conflict.
Positive outcomes include:
 better ideas produced;
 people forced to search for new approaches;
 long-standing problems brought to the surface and resolved;
 clarification of individual views;
 stimulation of interest and creativity;
 a chance for people to test their capacities.
Negative outcomes include:
 some people felt defeated and demeaned;
 the distance between people increased;
 a climate of mistrust and suspicion developed;
 individuals and groups concentrated on their own narrow interests;
 resistance developed rather than teamwork;
 an increase in employee turnover.
Functions & benefits of Conflict

 Discussing conflict makes organizational members more aware and able to cope with
problems. Knowing that others are frustrated and want change creates incentives to
try to solve the underlying problem.
 Conflict promises organizational change and adaptation. Procedures, assignments,
budget allocations, and other organizational practices are challenged. Conflict draws
attention to those issues that may interfere with and frustrate employees. Conflict
strengthens relationships and heightens morale. Employees realize that their
relationships are strong enough to withstand the test of conflict; they need not avoid
frustrations and problems. They can release their tensions through discussion and
problem solving.
 Conflict promotes awareness of self and others. Through conflict, people learn what
makes them angry, frustrated, and frightened and also what is important to them.
Knowing what we are willing to fight for tells us a lot about ourselves. Knowing what
makes our colleagues unhappy helps us to understand them. Conflict enhances
personal development. Managers find out how their style affects their subordinates
through conflict. Workers learn what technical and interpersonal skills they need to
upgrade themselves.
 Conflict encourages psychological development—it helps people become more
accurate and realistic in their self-appraisals. Through conflict, people take others'
perspectives and become less egocentric. Conflict helps people believe they are
powerful and capable of controlling their own lives. They do not simply need to
endure hostility and frustration but can act to improve their lives.
 Conflict can be stimulating and fun. People feel aroused, involved, and alive in
conflict, and it can be a welcome break from an easygoing pace. It invites employees
to take another look and to appreciate the intricacies of their relationships.
Different views of conflict
The happy family view (or unitary perspective) -assumes that organisations are
basically co-operative structures, in which there are no systemic conflicts of interest
The conflict view (or pluralist perspective)
assumes that organisations are natural arenas for conflict, as members compete for
limited resources, status and rewards, and pursue different goals and professional values
The evolutionary view (or interactionist perspective)
regards conflict as a force for gradual, evolutionary change: it maintains the status quo
while also keeping the organisation sensitive to the need for change
Causes of Conflict Mullins

71

 Differences in perception
 Limited resources
 Specialisation
 The nature of work activities
 Role conflict
 Inequitable treatment
 Violation of territory
 Environmental change
Inter-group conflict -Intergroup conflict between unions and management, warring

nations, feuding families, or community action groups and government authorities.
 Institutionalised conflict
 Hierarchy-based conflict
 Functional conflict
 Line/staff conflict
 Formal/informal conflict
 Status conflict
 Resource conflict
 Political conflict
Intra-group conflict- Intragroup conflict is within a small group – among team and
committee members and within families, classes, fraternities and sororities and work
groups.
 Disagreement about needs, goals, values, priorities and interests
 Poor communication
 Competition for scarce resources
 Interpersonal issues
 Hygiene issues
 Problem solving – this is where the parties are brought together in order to find a
solution.
 Superordinate goals – this is where the parties are encouraged to see a bigger
picture and to identify overarching shared goals, ignoring their differences in the short
term. An example would be future co-operation and contracts.
 Expansion of resources – this is where additional resources would be freed and
mobilised, reducing the conflict between the parties.
 Avoidance – this is where one or both of the parties withdraws completely.
 Smoothing – this is where both parties play down their differences in an attempt to
achieve a solution by ‘papering over the cracks’. This may lead to a conclusion which
can then identify solutions to the earlier problems.
 Compromise – this is a process of bargaining, negotiating and agreeing so that each
party gains something but not everything they had hoped for.
 Authoritative command – this is where an arbitrator or someone with authority over
both parties would intervene and impose a solution.
 Altering the human variable – this is where there is an attempt to alter attitudes,
beliefs and perceptions
 Altering structural variables – this is where re-organisation attempts to minimise
conflict.
 Communication
 Bringing in outsiders
 Restructuring the organization
 Appointing a devil’s advocate
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Source: Based on S. P. Robbins, Managing Organizational Conflict: A Nontraditional
Approach (Upper Saddle River, NJ: Prentice Hall, 1974), pp. 59–89
Conflict handling styles (Thomas Kilmann)
Avoiding
You withdraw from the conflict or attempt to sweep it under the carpet.
Forcing/competing
You impose your solution on the problem.
Accommodating
You concede the issue without a fight, to preserve harmony.
Compromising
You use bargaining or negotiation, so that each party trades some concessions for some
gains.
Collaborating
You work together to find an outcome which meets the clearly stated needs of both parties as
far as possible.
Win Win approach-(Ury and Fisher)
 Step 1 Find out why each party needs what they say they want.
 Step 2 Find out where the differences dovetail.
 Step 3 Design new options, where everyone gets more of what they need.
 Step 4 Co-operate. Treat the other person as a partner, not an opponent.
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4.0 Understand and apply ethical practices, standards and regulations that impact on
the procurement and supply function
4.1 Examine ethical practices and standards that apply to global supply chains
• Developing a culture of commitment to achieveethical codes and practices
• Traidcraft
• UN
• ILO
What is ethics?
At its simplest, ethics is a system of moral principles. They affect how people make
decisions and lead their lives.
Ethics is concerned with what is good for individuals and society and is also
described as moral philosophy.
The term is derived from the Greek word ethos which can mean custom, habit,
character or disposition.
Being ethical is also not the same as following the law. The law often incorporates
ethical standards to which most citizens subscribe. But laws, like feelings, can
deviate from what is ethical. Ethics is about doing the right thing.
Business Ethics
‘Business ethics’ is defined by the IBE as ‘the application of ethical values to

business behaviour’.
Ethical Procurement
Ethical procurement (often referred to as responsible procurement) refers … to

procurement processes which;
•respect fundamental international standards against criminal conduct (like bribery,

corruption and fraud) and human rights abuse (like modern slavery), and respond
immediately to such matters where they are identified, and
74

•result in progressive improvements to the lives of people who contribute to supply
chains and are impacted by supply chain decisions.
Organizations and professions often seek to address standards of conduct through

the adoption of codes of conduct.
Professional codes of conduct generally are written in broad conceptual terms rather
than in specific situational or descriptive terms.
They leave room for interpretation and often may seem ambiguous.
Procurement professionals cannot abide merely by the letter of the law or the specific
words in any code, but rather, they are guided by the spirit of the law or the broader
concept that the code is intended to express
Codes and standards can be subdivided in several ,different ways:
• Mandatory (e.g. UK Competition Commission’s Grocery Supply Code of Practice)

vs. voluntary (e.g. SA8000).
• Those based on minimum international standards, and those which go beyond
• Those which are independently verified
• Those which apply to an organisation and those which apply to a product
• Those which involve supplier and worker representatives in the setting and
governance of the standard (as appropriate to the objectives of the standard).
Carrying out supplier due diligence is just that and involves carrying out some
research into a prospective supplier before agreeing a transaction or a contract.
Key questions to ask before engaging with a supplier
1. How financially stable is the supplier?
2. What quality and environmental management systems are in place?
3. Do they have a Corporate Social Responsibility / Ethical Sourcing policy?
4. What are their terms of business?
5. They say it best – what do their current customers say?
Due Diligence then is pre-contract award- it is about supplier selection. Pre-

qualification or Supplier Assessment is involved. Risk mapping may be part of this
analysis.
Planning
75

Identify appropriate information requirements in drafting of the RFP
Agree on the scope that needs to be applied to the final bidding parties that you wish
to be investigated
Supplier selection and contracting
 Conduct financial due diligence, analyse the key risks of the supplier and also
conducting background checks
 Generate a risk profile of the supplier, with recommendations on how you may
be able to mitigate those risks
 Review and ensure probity in the selection process
 Provide risk mitigation strategies to ensure successful project completion

results with the supplierSupplier monitoring:
 Agree on the scope, to determine the activities to be undertaken in monitoring

the contracting entity (e.g. frequency, depth of financial and commercial
analysis)
Contract performance and supplier monitoring
Conduct a regular independent risk profile assessment of the entity

Understand the risk profile of the supplier, and recommendations on how you may
mitigate any risks or issues identified
Provide feedback to the supplier, so that they have the best opportunity to address
the issues raised and take steps towards correcting the risks identified
Enhance supplier relationship management by encouraging communication between
you and the supplier
Supplier due diligence assists your project in:
 Determining what information you should be requesting from the supplier for
the tender process;
 Understanding the risk profile of the supplier and the individuals associated
with it; and
 Developing commercial and financial conditions in your final contract with the
successful bidding supplier
How will this add value to your procurement process?
 Help you make more informed decisions. Developing the tender information
request for suppliers will ensure you receive the necessary information from
the supplier at the start of the supplier evaluation process
 Better understand the unique risks of the private company. Enable you to
understand the risks associated with the supplier and implement risk
mitigation strategies
76

 Manage supply chain risk more effectively. By understanding the risks unique
to your supplier, you can develop appropriate contracting arrangements to
manage your risk
Corporate Social Responsibility CSR is largely voluntary so contracts are required.
Contracts state all the important aspects of the business transaction, such as price,
deadlines, quality and terms of payment, as well as expectations regarding ethical
and sustainable supply.
Ethical procurement and sustainability targets should be included in the contract as

well as in the specification.
Key Performance Indicators (KPIs) can measure the progress towards targets
Sustainability Contractual Clauses
SCCs are provisions in business contracts that cover social and environmental
issues which are not directly connected to the subject matter of the specific contract.
This means that they do not specify the physical quality of the delivered goods , but
rather prescribe how the parties should generally behave when conducting business.
An example is a requirement to avoid child labour or to reduce emissions in the

production process.
The most common issues covered by SCCs include the protection of human rights,
labour conditions, environmental protection and anti-bribery provisions
Labour standards codes are usually based on the International Labour Organisation’s
conventions. The ILO’s 1998 ‘Declaration on Fundamental Principles and Rights at
Work’ set out eight core conventions whose principles are binding on all ILO member
states, i.e. most countries.
ILO Core Labour Standards:
1. 1.Forced Labour Convention,
2. 2.Freedom of Association and Protection of the Right to Organise Convention,
3. 3.Right to Organise and Collective Bargaining Convention,
4. 4.Equal Remuneration Convention,
5. 5.Abolition of Forced Labour Convention,
6. 6.Discrimination (Employment and Occupation) Convention,
7. 7.Minimum Age Convention,

77

8. 8.Worst Forms of Child Labour Convention,
ETI Base Code
Labour standards codes are usually based on the International Labour Organisation’s
conventions. The ILO’s 1998 ‘Declaration on Fundamental Principles and Rights at
Work’ set out eight core conventions whose principles are binding on all ILO member
states, i.e. most countries.
ILO Core Labour Standards:
1. 1.Forced Labour Convention,
2. 2.Freedom of Association and Protection of the Right to Organise Convention,
3. 3.Right to Organise and Collective Bargaining Convention,
4. 4.Equal Remuneration Convention,
5. 5.Abolition of Forced Labour Convention,
6. 6.Discrimination (Employment and Occupation) Convention,
7. 7.Minimum Age Convention,
8. 8.Worst Forms of Child Labour Convention,
Other Standards include;
The UN Global Compact

The Ten Principles of the UN Global Compact-The UN Global Compact’s Ten
Principles are derived from: the Universal Declaration of Human Rights, the
International Labour Organization’s Declaration on Fundamental Principles and
Rights at Work, the Rio Declaration on Environment and Development, and the
United Nations Convention Against Corruption.
Human Rights
Principle 1: Businesses should support and respect the protection of internationally
proclaimed human rights; and
Principle 2: make sure that they are not complicit in human rights abuses.
Labour
Principle 3: Businesses should uphold the freedom of association and the effective
recognition of the right to collective bargaining;
Principle 4: the elimination of all forms of forced and compulsory labour;
Principle 5: the effective abolition of child labour; and
Principle 6: the elimination of discrimination in respect of employment and
occupation.
Environment
Principle 7: Businesses should support a precautionary approach to environmental
challenges;
Principle 8: undertake initiatives to promote greater environmental responsibility; and
Principle 9: encourage the development and diffusion of environmentally friendly
technologies.
Anti-Corruption
Principle 10: Businesses should work against corruption in all its forms, including
extortion and bribery
78

SA8000
SAI is a non-governmental, international, multi-stakeholder organization dedicated to

improving workplaces and communities by developing and implementing socially
responsible standards.
SAI convenes key stakeholders to develop consensus-based voluntary standards,
conducts
cost-benefit research, accredits auditors, provides training and technical assistance,
and assists corporations in improving social compliance in their supply chains.
In 1997, SAI launched SA8000 (Social Accountability 8000) – a voluntary standard
for workplaces, based on ILO and UN conventions – which is currently used by
businesses
and governments around the world and is recognized as one of the strongest
workplace standards.
SAI partners with trade unions, local NGOs, multi-stakeholder initiatives, organic, fair
trade, and environmental organizations, development charities, and anti-corruption
groups to carry out research, training and capacity-building programs.
SA8000 was the first auditable social standard and creates a process that is truly
independent. Representatives of trade unions, human rights organisations,
academia, retailers, manufacturers, contractors, as well as consulting, accounting,
and certification firms, by consensus, cooperated to develop the SA8000 Standard.
Elements of the SA8000 Standard
1. Child Labour
2. Forced or Compulsory Labour
3. Health and Safety
4. Freedom of Association and Right to Collective Bargaining
5. Discrimination
6. Disciplinary Practices
7. Working Hours
8. Remuneration
9. Management System
Benefits of SA8000
 Marketing advantage – more demand and value for goods from socially.
 Responsible manufacturers/suppliers.
 Enhancement of company productivity.
 Compliance to the laws of the land.
 Improvement of relationship with the Govt., NGOs, trade unions.
 Better image and position in labour market.
Benefits of SA 8000 to the retailers:
 Cost reduction in monitoring.
 Better corporate image.
 Increased value for the products.
 Trust building with the analysts and investors when evaluated against social
performance.
79

ISO 20400:2017 Sustainable procurement -- Guidance
Is the world’s first international standard to, provide guidance on delivering
sustainability objectives through its supply chain.
ISO 20400:2017 provides guidance to organizations, independent of their activity or
size, on integrating sustainability within procurement, as described in ISO 26000. It is
intended for stakeholders involved in, or impacted by, procurement decisions and
processes.
While the standard outlines how an organisation can integrate efficient procurement
steps into its existing procurement methods, it does not make recommendations for
changing the procurement methods themselves.
The standard also uses the core pillars of sustainability, taken from ISO26000:
This is a guidance standard like ISO 26000, not a requirements ,standard like ISO
14001. This ,means an organisation cannot be certified for compliance but can be
evaluated and/or advised by a competent third party.
Definition
“Procurement that has the most positive
environmental, social and economic impacts on
a whole life basis”.
The standard also uses the core pillars of sustainability, taken from ISO26000:
• Organisational governance
• Human rights
• Labour practices
• The environment
• Fair operating practices
• Consumer issues
• Community involvement and development
Why should you use this standard?
This standard will help your organization practise sustainable procurement and
thereby improve the sustainability performance of your supply chain and reduce risk.
Users will benefit from:
 An increased contribution to the organization’s overall sustainability strategy

 Better risk and compliance management
 Improved value and performance assessment
 Better communications with stakeholders and along the supply chain
 More opportunities to innovate
Includes:
 Concepts, terms and definitions related to social responsibility

 Principles and practices relating to social responsibility
 Core subjects and issues of social responsibility
 How to integrate, implement and promote socially responsible behaviour throughout
the organisation and supply chain
 How to identify and engage with stakeholders
80

 How to communicate commitments, performance and other information related to
social responsibility
The standard was launched in 2010 following five years of negotiations between
many different stakeholders across the world. Representatives from government,
NGOs, industry, consumer groups and labour organizations around the world were
involved in its development, which means it represents an international consensus.
How does ISO 26000 define Social Responsibility?
Social Responsibility (SR) is the responsibility of an organization for the impacts of its
decisions and activities on society and the environment through transparent and
ethical behaviour that:
 Contributes to sustainable development, including the health and welfare of

society
 Takes into account the expectations of stakeholders
 Is in compliance with applicable law and consistent with international norms of
behaviour, and
 Is integrated throughout the organization and practised in its relationships.
The 7 Principles
1. Accountability
2. Transparency
3. Ethical behaviour
4. Respect for stakeholder interests
5. Respect for the rule of law
6. Respect for international norms of behaviour
7. Respect for human rights
• Developing a culture of commitment to achieve ethical codes and practices
• Traidcraft
• UN
• ILO
---------------------
 CIPS Code Of Conduct
As a member of The Chartered Institute of Procurement & Supply, I will:

Enhance and protect the standing of the profession, by:
81

 never engaging in conduct, either professional or personal, which would bring
the profession or the Chartered Institute of Procurement & Supply into
disrepute
 not accepting inducements or gifts (other than any declared gifts of nominal
value which have been sanctioned by my employer)
 not allowing offers of hospitality or those with vested interests to influence, or
be perceived to influence, my business decisions
 being aware that my behaviour outside my professional life may have an
effect on how I am perceived as a professional
Maintain the highest standard of integrity in all business relationships, by:
 rejecting any business practice which might reasonably be deemed improper

 never using my authority or position for my own financial gain
 declaring to my line manager any personal interest that might affect, or be
seen by others to affect, my impartiality in decision making
 ensuring that the information I give in the course of my work is accurate and
not misleading
 never breaching the confidentiality of information I receive in a professional
capacity
 striving for genuine, fair and transparent competition
 being truthful about my skills, experience and qualifications
Promote the eradication of unethical business practices, by:
 fostering awareness of human rights, fraud and corruption issues in all my

business relationships
 responsibly managing any business relationships where unethical practices
may come to light, and taking appropriate action to report and remedy them
 undertaking due diligence on appropriate supplier relationships in relation to
forced labour (modern slavery) and other human rights abuses, fraud and
corruption
 continually developing my knowledge of forced labour (modern slavery),
human rights, fraud and corruption issues, and applying this in my
professional life
Enhance the proficiency and stature of the profession, by:
 continually developing and applying knowledge to increase my personal skills

and those of the organisation I work for
 fostering the highest standards of professional competence amongst those for
whom I am responsible
 optimising the responsible use of resources which I have influence over for
the benefit of my organisation
Ensure full compliance with laws and regulations, by:
 adhering to the laws of the countries in which I practise, and in countries

where there is no relevant law in place I will apply the standards inherent in
this Code
82

 fulfilling agreed contractual obligations
 following CIPS guidance on professional practice
Traidcraft
Established 1979 as a Christian response to poverty.
Mission
“Our mission is to fight poverty through trade, practising and promoting approaches
to trade that help poor people in developing countries transform their lives”
Traidcraft is the UK’s leading fair trade organisation and is made up of a trading
company (Traidcraft plc) and an international development charity (Traidcraft
Exchange).
This unique structure they state gives them “many opportunities to influence opinion
and behavior in the charitable, private and public sectors”.
They work in over 30 developing countries in Africa, Asia and South America.
Walk Free Foundation
Has a multi-faceted approach towards ending modern slavery. This includes building
a robust knowledge base to inform action, driving legislative change in key countries,
harnessing the power of businesses and faiths and bringing new resources to this
issue. They produce a global slavery index with an annual ranking of 167 countries
based on the percentage of a country's population that is estimated to be in modern
slavery.
Walk Free - Join The Movement To End Modern Slavery-Published on 18 Mar 2014
Never underestimate the power of one person taking a stand against slavery. 1m 50
https://youtu.be/JZpl3c4uJGo
4.2 Assess regulations that impact on the ethical employment of people
• Regulations such as:
• Health and safety at work
The UK legal framework
83

Primary legislation
Statutes that are passed by Parliament (ie statute law) to create definitive duties,
rights and requirements.
Secondary legislation
Statutory instruments and regulations, each relating to a particular statute law, which
create rights, duties and entitlements.
Common law
Or case law, formed through the judgements made in the judicial system. It
comprises contract law and the law of tort.
Statutory codes of practice
Approved by Parliament as sets of decision rules and procedures for the proper way
in which a given thing should be done.
European Union law
As manifested through treaties, directives, and the European Court of Justice.
The European Convention on Human Rights
The Council of Europe’s declaration establishes many workplace rights.

The European Convention on Human Rights
The Convention has implications for employment law:
 Legislation needs to comply with the Convention ‘so far as it is possible to do so’
 UK courts should take into account rulings at the European Court of Human Rights to
inform their own deliberations
 Common law needs to be compatible with the Convention which, as common law is
established through interpretation and precedents, may mean challenging
established practice
 Incompatible secondary legislation needs to be disapplied
 Public authorities cannot act incompatibly with the Convention
The characteristics covered by this act are disability, gender reassignment, pregnancy and
maternity, race, religion or belief, sex and sexual orientation.
The Equality Act 2010 legally protects people from discrimination in the workplace and in
wider society.
Five principles of discrimination law
 The right not to be directly or indirectly discriminated against
Direct discrimination occurs when a person is treated less favourably than
another person because of a protected characteristic. Indirect discrimination
happens when there is a rule, a policy or even a practice that applies to everyone
but which particularly disadvantages people who share a particular protected
characteristic. Indirect discrimination can be justified if it can be shown that the
rule, policy or practice is intended to meet a legitimate objective in a fair,
balanced and reasonable way. If this can be shown it will be lawful
 The right to be treated no less favourably than comparable workers
84

 The right not to be subjected to harassment on discriminatory grounds
Harassment means unwanted behaviour related to a protected characteristic that
has the purpose or effect of violating a person’s dignity or creating an
intimidating, hostile, degrading, humiliating or offensive environment for them.
 The right not to be victimised for having brought a discrimination complaint
 An obligation on the employer to consider suitable adjustments
Positive action
If employers reasonably think that people who they engage with that share a particular
protected characteristic:
 experience a disadvantage connected to that characteristic
 have needs that are different from the needs of other people, who do not share that
characteristic have disproportionately low participation in an activity
 The employer can take action that is proportionate to the disadvantage to:
 enable or encourage their employees to overcome or minimise the disadvantage they
experience meet the different need improve participation rates
Employment Rights Act 1996 Ways of avoiding redundancy

Confers rights to: • Working time and staff payment
• Statement of employment particulars, pay • International labour codes
statement • Rights of agency workers
• Protection of wages
• Protection from suffering detriment in
employment
• Time off work for public duties, to look for
work and training (in redundancy situations),
ante-natal care, employee reps
• Suspension from work on medical and
maternity grounds
• Maternity rights
• Termination of employment: notice periods,
written reasons for dismissal
• Not be unfairly dismissed and remedies
• Redundancy provisions and payments
The employer’s duty to consult Potential outcomes of unfair dismissals
•Redundancy consultation must at least Reinstatement
include The employee returns to their job as if they
•Reasons for the proposed redundancies had never been away.
•Number of employees involved Re-engagement
•Proposed methods of selecting those to be The employee returns to their employer on no
made redundant less favourable terms.
•Timing of the dismissals Compensation
The ex-employee receives a settlement for
the unfair termination of their employment.
Recognition that an unfair dismissal has
taken place
The ex-employee’s employment history is not
compromised.

Working Time Regulations 1998/2002
• Limits on working time to 48 hrs pw
• Rest breaks of 20 minutes (unpaid) per 6 hours’ work
• Daily and weekly rest periods
85

• Annual leave
• Restricted night working
Basic rights and protections
The basic rights and protections that the Regulations provide are:
 a limit of an average of 48 hours a week which a worker can be required to work
(though workers can choose by written agreement to work more if they want to) - a
new 60-hour weekly average limit measured over three months is currently
progressing through Parliament. It is also proposed that workers will not be able to
opt-out until they have worked for a business for at least four weeks.
 a limit of an average of eight hours work in 24 hours which night workers can be
required to work
 a right for night workers to receive free health assessments before commencing night
work, and at regular intervals thereafter
 a right to 11 hours rest a day
 a right to a day off each week
 a right to an in-work rest break of at least 20 minutes if the working day is longer than
six hours
 a right to a minimum of 5.6 weeks' paid annual leave (inclusive of bank holidays).
 adequate additional rest breaks for workers whose pattern of work puts their health
and safety at risk.
Flexible working
Annualised hours-your work hours need to reach a given annual total, but are otherwise
open to negotiation. Compressed hours-working the required hours but over fewer days.
Flexi-time-choosing when you work (usually in relation to a compulsory ‘core’ period)
Homeworking -working from home
Job sharing-sharing a job designed for one person with someone else
Part-time working-working less than the normal hours
Staggered hours-different start, rest and finish times for different employees in the same
workplace
• International labour codes – ETI base code and ILO labour conventions
ETI code
1. Employment is freely chosen
2. Freedom of association and the right to collective bargaining are respected
3. Working conditions are safe and hygienic
4. Child labour shall not be used- no one under 15
5. Living wages are paid
6. Working hours are not excessive- 48 hours but 60 by exception
7. No discrimination is practised
8. Regular employment is provided
9. No harsh or inhumane treatment is allowed
Read full code at; http://s3-eu-west-
1.amazonaws.com/www.ethicaltrade.org.files/shared_resources/eti_base_code_english.
pdf?ppXz9ivoyynr1uTTo5e.Z5n.ZHaQvQfN
• Health and safety at the workplace

Health and Safety at Work etc Act 1974
Often referred to as HASAW or HSW, this Act of Parliament is the main piece of UK
health and safety legislation. It places a duty on all employers "to ensure, so far as is
reasonably practicable, the health, safety and welfare at work" of all their employees.
Among other provisions, the Act also requires:
 safe operation and maintenance of the working environment, plant and systems
 maintenance of safe access and egress to the workplace
 safe use, handling and storage of dangerous substances
86

 adequate training of staff to ensure health and safety
 adequate welfare provisions for staff at work.
Assessing workplace risks
 Identify risks
 Decide who might be harmed and how
 Evaluate risks and decide upon precautions
 Record your findings and implement them
 Review your assessment and update if necessary
87

Key elements of successful health and safety management source: HSE Successful health
and safety management, 2008
KEY MESSAGES
Effective health and safety policies contribute to business performance by:
supporting human resource development;
• minimising the financial losses which arise from avoidable unplanned
events;
• recognising that accidents, ill health and incidents result from failings in
management control and are not necessarily the fault of individual
employees;
• recognising that the development of a culture supportive of health and
safety is necessary to achieve adequate control over risks;
• ensuring a systematic approach to the identification of risks and the
allocation of resources to control them;
• supporting quality initiatives aimed at continuous improvement.
• The UK National Minimum Wage (NMW) is the minimum pay per hour
most workers under the age of 25 are entitled to by law.
• The government's National Living Wage (NLW) is the minimum pay per
hour most workers aged 25 and over are entitled to by law.
• The rate will depend on a worker's age and if they are an apprentice.
• HMRC (HM Revenue & Customs) can take employers to court for not
paying the NMW/NLW.
• These rates are reviewed annually by the Low Pay Commission.
ETI Base Code-Base code clause 5 states:
5: Living wages are paid
5.1 Wages and benefits paid for a standard working week meet, at a minimum,
national legal standards or industry benchmark standards, whichever is higher. In any
event wages should always be enough to meet basic needs and to provide some
discretionary income.
Living Wages are Paid- CIPS Guidance
• Wages and benefits should at least meet industry benchmarks or national legal
standards. As a minimum, the wages paid to suppliers' employees should meet their
basic needs
• Suppliers should not make deductions from wages unless permitted by national law
or with the permission (without duress) of the employee
• Suppliers should always pay in cash and not in kind, e.g. goods, vouchers
88

Source; CIPS 2007 -Ethical Business Practices in Purchasing and Supply
Management
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Study Pass Notes

Version 3.0 © YPTC

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not for re-sale or distribution ©YPTC

1.1 Critically evaluate the differences between leadership and management

• The role of a leader and the activity of leadership

• The importance of leadership

• The differences between management and leadership

• The continuum of leadership behaviour

• The forces in deciding the type of leadership

• Transformational and inspirational leadership

• The qualities or traits approach to leadership

• The functional or group approach, including action centred leadership

• Styles of leadership including the authoritarian or autocratic, democratic and

• Contingency theories for leadership such as path goal theory

• Implementing a vision of improved procurement and supply chain

• Models for managing in four different directions

• The merits of escalation as a means of influencing

not for re-sale or distribution ©YPTC

• Assessing the readiness of followers or groups

• Leaders attitudes to people

• Management by objectives and establishing KPIs

• Stakeholder analysis including primary, secondary and key stakeholder

• How to obtain buy in to supply chain strategies from stakeholders

• Perspectives on stakeholder mapping

3.0 Understand and apply methods to overcome leadership challenges faced by

• Perspectives on individual power

• Processual, institutional and organisational levels of power

• Perspectives on organisational power

• The balance between order and flexibility

• Defining diversity, equality and inclusion

• The benefits of diversity in organisations

• The impact of discrimination, harassment and victimisation

• Developing and implementing policies to enhance diversity

not for re-sale or distribution ©YPTC

• The nature of organisational change

• Planned organisational change

• Dealing with resistance to change

• Effective change management

• Contingency models of organisations

• The functions of the informal organisation

• The positive and negative outcomes of conflict

• Strategies for resolving conflict

• Incremental and transformational change

• Ethical codes of practice

• Due diligence on suppliers

• Leading ethical practices and standards

• Developing a culture of commitment to achieve ethical codes and practices

• Initiatives and policies created by leading bodies such as:

• CIPS Code of Conduct

• The Walk Free Foundation

4.2 Assess regulations that impact on the ethical employment of people

Regulations such as:

not for re-sale or distribution ©YPTC

• Employee redundancy and dismissal

• Working time and staff payment

• International labour codes

• Health and safety at work

not for re-sale or distribution ©YPTC

1.1 Critically evaluate the differences between leadership and management

• The role of a leader and the activity of leadership

• The importance of leadership