Lesson 5 Discussion Forum Caterpillar Inc. (CAT) is an American-based company and the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. CAT can trace its origins back to a 1925 merger between two tractor companies. However, the official genesis was in 1986 when the company reorganized under the Caterpillar Inc. name. The CAT headquarters are in Peoria, Illinois.
Over the years, CAT has offshored a lot of their manufacturing. Offshoring is different than outsourcing because the company still has ownership of the process. However, the location of the process is abroad. On the other hand, outsourcing is the complete transfer of ownership of a process or product that the company used to perform or produce in-house.
CAT’s management decision to offshore manufacturing is in part of their vision statement. With this declaration, CAT’s management made a decision that they needed to provide the best value to customers globally. To illustrate, Andrew Thompson discusses part of CAT’s vision statement, “Caterpillar will be the leader in providing the best value in machines, engines and support services for customers dedicated to building the world’s infrastructure and developing and transporting its resources. We provide the best value to customers” (Thompson, 2015). CAT’s vision statement guided the company’s decision to offshore manufacturing. As a result, people
In general, the outsourcing is hiring the foreign workers/company to do a particular task, as opposed to hiring domestic workers/company. Besides the outsourcing, the international purchase is an essential activity of companies. In the trend of a booming global economy, a company only focuses on its core value and hire suppliers to supply the necessary product and service. The relationship between companies are complicated and interdependent.
The problem that Deere faces is how they can successfully move to the middle of the perceptual map to be respected as a manufacturer of both small tractors and large tractors. There are several observations that can be made regarding the positioning of the competitors. The first observation is both International Harvester and Case are competing in both the large and small tractor market. It is evident that International Harvester experience financial difficulties perhaps as a result of not having a singular focus. Another observation is that Caterpillar’s decision to “reposition” itself from a small manufacturer to a large manufacturer could easily be explained by Paretti’s 80/20 rule. Caterpillar enjoyed an extensive dealer network, and their dealer sales ranged from $12 million to $70 million, versus Deere’s $1 million to $16 million in sales per dealer. By tapping into Paretti’s 80/20 principle, Deere could enjoy increased margins from the sale of parts alone.
Caterpillar’s main industry of machinery has many barriers to entry which makes it difficult for new organisations to enter the market. It is a mature and highly competitive industry with few dominant competitors who have cemented their position over the decades. Furthermore, these corporations have sustained a competitive advantage over any new entrant that tries to enter into the industry.
This case analysis explores the possibility of Breezy, a leading supplier of carburators and air filters in North America, the possibility of developing offshore busines in countries where car manufacturing is growing. The report is structured as follows: First, there are five important questions that Breezy must consider and ask itself before developing a relationship with a new customer. After Breezy decides to go offshore, it will have to go through the negotiating process, which involves five steps. Breezy then, must have capabilities of how an offshore business is organized, consider the many different costs and risks involved in the implementation and decide how it will finance the project. The report also talks
Outsourcing is a method used by many corporations in which their products are manufactured in foreign countries often for cheaper labor.This method method of productions has it’s pros and cons.
Cat Insurance provides various forms of insurance to customers and dealers to help support the purchase and lease of the Company’s equipment. Its wholly owned subsidiaries include Caterpillar Insurance Company, which has the license to conduct property and casualty insurance business in 49 states and the District of Columbia; Caterpillar Life Insurance Company, which has the license to conduct life and accident and health insurance business in 26 states and the District of Columbia; Caterpillar Insurance Co. Ltd., which is a captive insurance company; Caterpillar Product Services Corporation, which is a warranty company, and Caterpillar Insurance Services Corporation, which is an insurance brokerage company providing brokerage services for all property and casualty and life and health lines of business.
Long the pride of Peoria, Illinois, Caterpillar, Inc. has established itself as a premier global manufacturing powerhouse whose commercial construction, transportation and engine solutions have come to symbolize durability, quality, and economic progress. This project paper examines the operational and financial numbers resulting from the company’s global sales reach. This paper reviews the publically available corporate financial results for the last decade. This financial data review will be expanded to incorporate how operating and investing activities and results have also impact the Caterpillar bottom line. The paper will conclude with a short summary analysis providing team conclusions to whether the Caterpillar
Our firm has set out to Internationalise its operations by opening to different facilities One in China Assembling and Maintaining Aircraft Engines and the other in Europe fabricating turbine blades for Aircraft
Many people think that outsourcing is jobs that were held in this country going somewhere else. That is not entirely accurate. Outsourcing is actually one company paying another to do some work for it. Outsourcing can be as simple as paying a company to paint your building. Or it can be as complex as paying a company to control your human resources department.
Caterpillar Incorporated is the world’s largest producer of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines. Caterpillar's headquarters are located in Peoria, Illinois, United States. The company operates in three principal lines of business: machinery, engines, and financial products. The machinery segment includes the design, manufacture, marketing, and selling of all kinds of machinery such as; tractors, forestry and mining machinery, off-highway trucks, and paving products. The machinery segment also includes logistics services for other companies. The second business segment that Caterpillar operates in is engines. This includes the design, manufacture, marketing, and
Since its establishment in 1925, Caterpillar Inc. has built a name in the construction and mining industry as an excellent manufacturer of equipment for a wide range of applications. Today, the company is the market leader in the industry and now it targets to expand its operations globally. In the various emerging economies such as India, China, and Brazil, Caterpillar Inc. has sported potentially profitable opportunities which it needs to exploit before its competitors establish their presence in those markets (Rome & Levine, 2006). In this regard, Caterpillar Inc. has to have an effective business strategy and contingency plans as well as an effective implementation plan. This paper shall discuss the components of the implementation
This strategic report of ANZ’s offshoring strategy examines the effectiveness and drivers of ANZ’s decision to move towards outsourcing internationally, analyses the impact of ANZ’s offshore programs on stakeholders, explores key risks and opportunities and evaluates the success of ANZ’s offshore system.
RESEARCH PAPER: CATERPILLAR Abstract The topic of my research was the global management expertise and effectiveness of the company Caterpillar Inc., a global leader in the production and manufacturing of construction and mining equipment. I researched the company's website for core information and sought information outside the company for its global perspective. What I found
A common definition of outsourcing is the takes part of their business and give it to another company to complete. The main industries that take
When the question arises, there are lots of facts which explains the advantages of offshoring to India and that explains the best to the asked questions. Whatever are the ingredients required for performing offshoring functions, the location (India) is very rich in that, and thus it offers lots of advantages. Some of them are pointed out in list below:-