L2M3 Tutor Slides

CIPS Level 2 Certificate in Procurement and Supply Operations
Teaching Resources
Module title: Stakeholder Relationships [L2M3]
Leading global excellence in procurement and supply

Level 2 Stakeholder Relationships [L2M3]
Learning Outcome (LO)1: Know the

stakeholders in procurement and supply
All rights reserved. These slides are provided exclusively to CIPS Approved Study Centres for the sole purpose of teaching CIPS Professional
Slide 1
Qualifications, they are not to be used for any other purpose and may not be altered, copied, sold or lent to other parties. Copyright ©2018 CIPS
Learning Outcome 1: Know the stakeholders in
procurement and supply
1.1 Define external stakeholders in procurement and supply
• Defining and profiling stakeholders
• Typical stakeholders such as; suppliers, customers, consumers, communities,
government and other groups
• The distinction between customers and consumers

1.2 Identify internal stakeholders that can be involved in purchases from
suppliers and supplies delivered to customers
• The role of procurement and supply in dealing with other business functions such
as marketing, sales, production, operations, human resources, finance, design and
development, distribution, facilities, senior management and the board of
management

1.3 Describe how internal and external stakeholders influence procurement
and supply activity
• The internal and external stakeholders that can influence the work and success of
Slide 2
(1.1) Identifying stakeholders
Figure 1.1 Questions to ask when identifying your stakeholders
Slide 3
(1.1) Typical external stakeholders
Figure 1.5 External stakeholders
Slide 4
(1.1) Profiling stakeholders
Figure 1.3 Information that can be gained from a stakeholder-profiling exercise

Slide 5
(1.2) Internal stakeholders
Figure 1.7 Business functions involved with procurement and supply

Slide 6
(1.2) Internal stakeholders’ purchases and supplies
Activity
Identify the internal stakeholders that could be involved in
making purchases from suppliers, or delivering supplies to
customers.
1. Start by listing some of the departments that your

organisation has
2. Then consider some of the purchases and supplies that each
department will make
3. Why is it important for procurement to be aware of other
department’s purchases and supplies?
Slide 7
(1.2, 1.3) Internal stakeholders’ impact on
Figure 1.7 Business functions involved with procurement and supply

Slide 8
(1.3) How external stakeholders influence
Activity
Consider the impact a particular stakeholder could have on your
organisation.
1. Start by considering the level of interest and influence that
particular stakeholder has in relation to the business.
2. Based on the conclusion of your discussion, go on to consider
the impact that they could have on the procurement function of
the organisation.
Slide 9
Recommended reading
Level 2 Stakeholder Relationships Study Guide
‘Procurement and Supply Chain Management’ –

Lysons/Farrington
Slide 10
Learning exercise: Water Everywhere
1. Help Martina to identify key stakeholders for the project.

Who might be involved in the supply chain of the water cleaning kits?
Who benefits from the work of Water Everywhere? Will any
governments be involved?
2. Profile three of the stakeholders by considering:
• What they need from you
• What you need from them
• How they’ll be impacted by your plans
• The benefits of involving them in your work.
Slide 11
Learning Outcome (LO)2: Know the

key market factors that impact on a
procurement and supply function
All rights reserved. These slides
Qualifications, theyare
areprovided
not to beexclusively to CIPS
used for any otherApproved Study
purpose and Centres
may not befor the sole
altered, purpose
copied, soldoforteaching CIPS Professional
lent to other parties. Copyright ©2018 CIPS
Slide 12
Learning Outcome 2: Know the key market factors that
impact on a procurement and supply function
2.1 Identify the key economic sectors that impact on a procurement and supply function
• Public, private and not-for-profit or third sector
• Primary, secondary and tertiary sectors

2.2 Indicate the impact of demand and supply on markets
• Demand and supply curves, and how demand and supply factors impact pricing and availability

2.3 Describe how market factors impact on the procurement and supply activities of an
organisation
• The level of competition: perfect competition, imperfect competition, oligopoly, duopoly and
monopolies
• The impact of demand on sales
• Market growth and decline
• Competitive forces on organisations

2.4 Identify the contribution that marketing makes to develop customer and supplier
relationships
• The principles and definitions of marketing, and techniques associated with marketing
• Sources of competitive advantage sought through marketing
• Relevance of marketing principles to purchasers
Slide 13
(2.1) Economic sectors
Figure 1.4 [L2M1] The three sectors of the economy
Slide 14
(2.2) Demand curves
Figure 2.1 The law of demand
Slide 15
(2.2) Supply curves
Figure 2.2 The law of supply Figure 2.3 The point of equilibrium
Slide 16
(2.2) Impact of changes in demand and
supply
Figure 2.7 Movement along the Figure 2.8 Shift in the demand curve
supply curve for ice cream
Slide 17
(2.3) Levels of competition
• Perfect competition
• Imperfect competition
• Oligopoly
• Duopoly
• Monopoly

Slide 18
(2.3) Product life cycle
Figure 2.11 Example of a market life cycle
Slide 19
(2.3) Competitive forces on organisations
Figure 2.12 Porter’s Five Forces (Source: Porter, M.E. (1980). Competitive Strategy:
Techniques for Analysing Industries & Competitors. The Free Press, NY)
Slide 20
(2.4) 7 Ps of marketing
• Product
• Price
• Place
• Promotion
• People
• Process
• Physical evidence
Slide 21
Recommended reading

Lysons/Farrington
Slide 22
Learning exercise: Alessandro assesses the
market
1. Which economic sectors does Luxottica operate in?
2. What level of competition does Luxottica fall under?
3. Conduct a Five Forces analysis for this particular
organisation.
You can use the internet to assist you in your research,

and be sure to justify your answers.
Slide 23
Learning Outcome (LO)3: Understand

the techniques associated with
successful and effective communication
in procurement and supply
areprovided
purpose and Centres
altered, purpose
Slide 24
Learning Outcome 3: Understand the techniques
associated with successful and effective communication
in procurement and supply
3.1 Describe and explain approaches to build rapport with internal and external stakeholders
• Techniques to develop, maintain and improve relationships with internal stakeholders to promote
effective procurement and supply

3.2 Explain methods of negotiating with suppliers and customers
• Negotiation techniques for use with suppliers and customers to agree contract terms and
relationships that will achieve the interests of the overall organisation

3.3 Recognise all elements of the communication cycle
• The importance of appropriate, prompt and timely communications with stakeholders and suppliers
• How to create appropriate written correspondence and electronic files and documents

3.4 Describe the key characteristics of successful and effective team working
• Group cohesiveness and performance
• The characteristics of an effective work group
• The stages of team development
Slide 25
(3.1) Building rapport with stakeholders
Figure 3.3 More relationship-building ideas
Slide 26
(3.2) Negotiation techniques
Figure 3.5 The negotiation personality scale
Slide 27
(3.2) Negotiating with suppliers versus
customers
Figure 3.4 The five steps of the negotiation process
As a buyer: As a supplier:
• position yourself as a loyal • establish your credibility
customer • prepare thoroughly
• consider bulk discounts • emphasise quality
• talk to multiple suppliers • make concessions
• don’t accept the first offer • keep negotiations going
Slide 28
(3.3) The communication cycle
Figure 3.7 CIPS Communication cycle
Slide 29
(3.3) Methods of communication
Figure 3.6 Methods of communication
Slide 30
(3.3) Written communications
Figure 3.8 Examples of written business communications
Slide 31
(3.4) Stages of team development
Figure 3.9 Tuckman’s stages of team formation
Slide 32
Recommended reading

Lysons/Farrington
Slide 33
Learning exercise: FN Games
1. What method would you choose to inform the
packaging supplier in the first instance?
2. How might the supplier react to the news?
3. How would you use this information to advise Rishi
about how to communicate with the supplier?
4. Do you have any suggestions for how FN Games could
continue to work with the supplier?
Slide 34
Learning Outcome (LO)4: Know

approaches for conflict resolution with
stakeholders in procurement and
supply
areprovided
purpose and Centres
altered, purpose
Slide 35
Learning Outcome 4: Know approaches for conflict
resolution with stakeholders in procurement and supply

4.1 Identify the types of information that can be exchanged between purchasers and
suppliers
• Types of information exchange, such as; scheduling difficulties, demand forecasts, trends in
costs and availability, designs and innovations and new product development

4.2 Indicate how conflict can arise in the work of procurement and supply
• Defining workplace conflict
• The sources of conflict in organisations and between personnel
• The sources of conflict between organisations and their personnel

4.3 Identify approaches to conflict resolution with stakeholders in procurement and
supply
• Approaches to conflict resolution
• Clarifying roles and responsibilities
• Group cohesion
• Achieving buy-in from stakeholders
Slide 36
(4.1) Information exchanged between
purchasers and suppliers
• Scheduling difficulties
• Demand forecasts
• Trends in costs and availability
• Designs and innovations
• New product development
Slide 37
(4.2) Sources of conflict
• Internal changes
• Interpersonal relationships
• External changes
• Poor communication
• Performance levels
• Bullying/harassment
• Resources
Slide 38
(4.3) Thomas-Kilmann Conflict Mode
Instrument
Figure 4.1 Thomas-Kilmann Conflict Mode Instrument (Source: Copyright© 2009–2018

by Kilmann Diagnostics. All rights reserved. Original figure and text is available at:
www.kilmanndiagnostics.com/ overview-thomas-kilmann-conflict-mode-instrument-tki)
Slide 39
(4.3) Conflict resolution
• Accept that a problem exists
• Agree to address the solution
• Be prepared to understand the other’s point of view
• Identify changes in attitudes that need to be made to enable a
resolution
• Recognise the events that triggered the conflict
• Be prepared to compromise
• Agree on a plan to address the cause of the conflict
• Monitor the impact of agreements
• As a last resort, parties who resist resolving the conflict may need
to be disciplined
Slide 40
(4.3) Group cohesion
Figure 4.3 Factors affecting group cohesion
Slide 41
(4.3) Achieving stakeholder buy-in
Figure 1.3 Information that can be gained from a stakeholder-profiling exercise
Slide 42
Recommended reading

Lysons/Farrington
Slide 43
Learning exercise: Delayed lanyards
1. How would you react to this news?

2. At what point should the supplier have contacted Kent
to let him know there could be delays?
3. What could Kent have done if he had been informed
of the delay earlier?
4. Is there anything Kent could have done to avoid this
issue?
5. What options does Kent have now?
Slide 44

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CIPS Level 2 Certificate in Procurement and Supply Operations

Leading global excellence in procurement and supply

Learning Outcome (LO)1: Know the

Figure 1.1 Questions to ask when identifying your stakeholders

Figure 1.5 External stakeholders

Figure 1.3 Information that can be gained from a stakeholder-profiling exercise

Figure 1.7 Business functions involved with procurement and supply

1. Start by listing some of the departments that your

Figure 1.7 Business functions involved with procurement and supply

Level 2 Stakeholder Relationships Study Guide

‘Procurement and Supply Chain Management’ –

1. Help Martina to identify key stakeholders for the project.

Learning Outcome (LO)2: Know the

Figure 1.4 [L2M1] The three sectors of the economy

Figure 2.1 The law of demand

Figure 2.11 Example of a market life cycle

Level 2 Stakeholder Relationships Study Guide

‘Procurement and Supply Chain Management’ –

You can use the internet to assist you in your research,

Learning Outcome (LO)3: Understand

Figure 3.3 More relationship-building ideas

Figure 3.5 The negotiation personality scale

Figure 3.4 The five steps of the negotiation process

Figure 3.7 CIPS Communication cycle

Figure 3.6 Methods of communication

Figure 3.8 Examples of written business communications

Figure 3.9 Tuckman’s stages of team formation

Level 2 Stakeholder Relationships Study Guide

‘Procurement and Supply Chain Management’ –

Learning Outcome (LO)4: Know

Figure 4.1 Thomas-Kilmann Conflict Mode Instrument (Source: Copyright© 2009–2018

Figure 4.3 Factors affecting group cohesion

Figure 1.3 Information that can be gained from a stakeholder-profiling exercise

Level 2 Stakeholder Relationships Study Guide

‘Procurement and Supply Chain Management’ –

1. How would you react to this news?

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