Lesson 5 Discussion Forum : Caterpillar Inc.

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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

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