Professional Documents
Culture Documents
3. Strategy-
Caterpillars Strategy is based on two major pillars- value creations for its Customers and
maximum return for the Shareholders. It has been practicing different strategies depending
on the market and geographical regions. It can be classified as Customer-Oriented which
follows the Business Model of Seed, Grow & Harvest (Exhibit 4). It engages itself with
customers through a regular feedback mechanism. Voice of the customer is paramount, and it
believes in forging a long-lasting relationship with customers. This is important as major
source of revenue for Caterpillar Inc. is its post sales services.
Another aspect of its strategy is Differentiation- it is flexible in its structure and relies
majorly on Horizontal Coordination. It is continuously engaged in Innovation and providing
best services to its customers. It invested nearly 2 Billion USD in R&D and filed 1700
patents in 2015. It doesnt fear in taking risks and rewards creativity and innovation in all
fields. In markets, where it is coming with new products, it follows the role of an Analyzer
where it practices efficient production and tight cost control. It analyses the market and its
competitors and then takes actions. Despite three years of weak sales, it distributed high
dividends to its shareholders through Lean & Cost Effective Management and Restructuring.
4. People- Employee growth and competency development is a major factor which has resulted
in continuous high results. Regular feedback and one-on-one with Managers bring out the
best in the individuals. Few important practices are Transparency- Lucid Appraisal and Rating Mechanism
Rewards & Recognitions- Every employee is justly rewarded for his achievements, his
efforts are recognized and given due credit for it.
Employee Opinion Survey- It is the most critical survey which covers every aspect of
an individual employee. The results are not just shared with the Managers to help them
improve their workplace ecosystem and its progress is also monitored. Its forms a major
Action Item in the managers and HRs annual evaluation.
Diversity & Inclusion- Cross regional teams are formed amongst the employees.
Moreover, Heritage Walk and Sectional Outings are regularly organized to keep employees
tempo high.
Compensation- The compensation and annual hike provided by Caterpillar Inc. to their
employees are always above the industry standards.
Social Security Schemes- Numerous policies are in place to assist employees in their
social security.
Competency Development- It has signed MoUs with various reputed Universities and
Training Agencies to help employees reach their desired technical and non-technical
competency levels
Values in Action- Ethos of Caterpillar (Exhibit 5) They were one of the worlds first
companies to publish worldwide a code of conduct in 1974. Being such an old brand, one of
the major elements that comprise their legacy are their values. To sustain in the market for
about a century, the adherence of employees to the companys values is necessary. The
values caterpillar follows are:
Integrity
Commitment
Excellence
Teamwork
Sustainability
Sources: www.caterpillar.com
Exhibit 2: Caterpillar Structure
References:
1. http://beta.fortune.com/fortune500/caterpillar-59
2. http://interbrand.com/best-brands/best-global-brands/2015/ranking/caterpillar/
3. http://caterpillar.com