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Create a 10-slide presentation for Caterpillar Inc. leadership in which you summarize your key findings, propose recommendations, and provide rationale for your recommendations. Add speaking notes and cite sources.See attached and Respond to the following prompts: Summarize your evaluation of the alignment between what Caterpillar Inc. is currently doing and their mission, vision, or values statement. Would you propose any changes to Caterpillar Inc.'s mission, vision or values statements? Why or why not? (Refer to Wk 1, Bullet #4.)Summarize your assessment of whether Caterpillar Inc. is leveraging the appropriate value and cost drivers for their business strategy. Would you propose any changes? Why or why not? (Refer to Wk 2, Bullet #3.)Summarize your analysis of the strengths and weaknesses of Caterpillar Inc’s competitive advantages. Based on your analysis would you propose any changes? Why or why not? (Refer to Wk 2, Bullet #4.)Summarize your assessment of whether Caterpillar Inc. is using the appropriate measures to verify its strategic effectiveness. Based on your analysis would you propose any changes? Why or why not? (Refer to Wk 3, Bullet #1.)Summarize your evaluation of Caterpillar Inc.’s competitive position and how they have responded to shifts in the external and internal environments. Would you propose any changes in how Caterpillar Inc. responds to shifts in the external and internal environments? Why or why not? (Refer to Wk 3, Bullet #5.)Summarize your evaluation of how mergers and acquisitions in the past 5 years have contributed to Caterpillar Inc.’s performance. Would you propose that Caterpillar Inc. pursue mergers and acquisitions in the future? Why or why not? (Wk 4, Bullet #2.)Summarize your assessment of Caterpillar Inc.’s global strategy. Based on your assessment would you propose any changes? Why or why not? (Refer to Wk 4, Bullet #3.) week4.doc week1.doc week2.doc week3.doc Unformatted Attachment Preview 1 Strategic Management Research 2 Strategic Management Research Caterpillar was created in 1925 by the merging of Best Tractor and Holt Company. By 1960 the company had strategized itself by putting in place subsidiaries in the other countries that they were operating from, these are their manufacturing subsidiaries. The company has realized most of its success because of the distribution and dealership networks, which has enabled them to acquire a broader market base. The company has been relying on independent dealers in its marketing structure. Caterpillar has since grown to become a significant manufacturing and distribution dealer in diesel and machinery. They enjoy a broad market base, which has been supported by an effective strategic plan. The essay will thus examine Caterpillar’s strategic plans and execution in the business environment (Akturk et al, 2017). Appropriate Measures Caterpillar is using appropriate measures to verify its strategic effectiveness because, for instance, in its move to reduce costs, the company ensured that they assemble their finished products on their own. The company, too, has a very active and superior marketing organization, which has propelled them from acquiring new markets for their growth. For instance, the company invested in a $1.8 billion modernization program; this was integrated with an extensive network of computerized machinery. The company also has multiple plants in other areas that have increased its production capacity and even genuinely advanced on its technology for efficiency. The company has also designed its organizational structure to be more functional to improve decision making (Hynes & Veltsos, 2018). Organizational Structure A holacracy characterizes caterpillar organizational structure because of the decentralization of their powers and decision making throughout their organized groups. 3 Holacracy acts like an operating system in any organization with various sets of rules and processes, guidelines, checks, and balances to be used to help it become self-organized and selfmanaged. Caterpillar has reorganized its underground mining ales and the distribu8ton service divisions. The traditional structure involves the top-down authority model where decisions are made from the top management and down to the other divisions. Caterpillar adopted the holacracy structure, which decentralizes power because it would lead to improved customer delivery. Leadership Understanding The organization should examine their internal environment because this helps in ensuring that the stakeholders and the employees within the organization are all working towards their set objectives. With an analysis of the internal environment, the organization will be able to study where their weaknesses lie, their strengths and how they can tap into their opportunities while addressing the threats that may affect the organization. Analyzing the internal environment allows the organization to remain competitive and proactive for future changes. Besides, it helps the organization to diversify its business by developing new businesses and spreading its risks across different markets. Toa achieves this, the company’s rate of diversification should remain minimal. The external environment involves the political, economic, social, technological, and legal frameworks that affect business operations. Analyzing all these external elements sets the company to a competitive edge that will have them remain competitive in the market environment (Galpin et al, 2015). The organization structure focuses on developing solutions to help customers realize their potential through their service delivery. The organization structure is decentralized, like in the holacracy system, where different operational units are devolved with their organizational 4 structure. The company is headed by three CEOs who oversees the daily operations of the organization. Competitive Position The company stands as the most competitive in the industry, and it’s because of its wellstructured strategic approaches, the primary company source of competitiveness is through its global outsourcing. The company had sold all their outsourced machines; this was a move they took to take advantage of their well-established market structure by keeping their production costs low. The company also has its outsourcing of manufacturing products; this strategy has enabled them to save on costs. The company has a strong distribution network globally, which has created a strong brand image. Because of the constant shift in the legal environment, for instance, in the trade unions provisions, the company had created an employee involvement program which was majorly referred to as employee satisfaction process to handle the unforeseen changes with the trade unions. 5 References Akturk, M. S., Abbey, J. D., & Geismar, H. N. (2017). Strategic design of multiple lifecycle products for remanufacturing operations. IISE Transactions, 49(10), 967-979. Galpin, T., Whitttington, J. L., & Bell, G. (2015). Is your sustainability strategy sustainable? Creating a culture of sustainability. Corporate Governance, 15(1), 1-17. Hynes, G. E., & Veltsos, J. R. (2018). Managerial communication: Strategies and applications. SAGE Publications. 1 Strategic Management Research 2 Strategic Management Research One of the most important tasks that the managers of an organization can perform is to determine the best possible strategies for the business to undertake so that it can remain financially and operationally sound for many years to come. One method which these managers can utilize to do this is the AFI strategy framework. This model helps to combine three main overall processes that management must take in order to identify and implement the best strategies for the company. These steps are the analysis of both internal and external data to evaluate the performance of the corporation, the formulation and selection of various strategies that seek to better the business at a company and global level, and the implementation of any strategies that have been chosen in the previous steps (CIO Wiki, n.d.). This framework serves to integrate the knowledge and experience of all available managers within the organization and provides them with a template of sorts that can be utilized to plan out all strategic activities related to the company. Guiding Principles Most major companies in existence today will create a mission statement so as to distinguish themselves from their competition. Such a statement will need to be permanent, and therefore must address the mission of the organization at its most basic functional levels. In addition, the mission statement shows all who read it what values the business holds and what priorities its management keeps in mind when making decisions related to the corporation. This statement also clearly states the motivations of the company, as well as the directions that they intend to take in the future (David, 2011). Not only the managers derive benefit from the mission statement either, as it also serves as a guiding document for employees of the organization to use in all of their dealings as representatives of the business. 3 Mission Statement In light of these desired attributes, the mission statement of Caterpillar, Inc. has been reviewed and analyzed to determine whether it meets these reasonable standards. The statement of this company is “to provide the best value to customers, grow a profitable business, develop and reward people, and encourage social responsibility” (Thompson, 2018). This mission statement is somewhat complex, and it does indeed contain some elements that resemble the ones mentioned in the text. However, there are also some points in which the company could potentially improve upon their current statement. For instance, the first facet of the statement is based around providing the greatest value possible to their customers. While this is of course a valiant goal, it does little to distinguish the company from competitors since this is an objective of nearly any business. The second point in the statement revolves around growing a business that generates profits, which is a similarly standard target for any company. However, the third point mentioned in the mission statement provides a good overview of the values of the organization when it states that the business likes to develop and reward people. This shows both the employees of the corporation and its customers that people are very important to it, and that it will always work to improve upon its relationships with these individuals. The final point mentioned in the mission statement of Caterpillar is that the company seeks to encourage social responsibility. While this is of course a necessary societal function and it reflects well upon the brand that they are interested in it, it would perhaps make for a better statement to illustrate specific ways in which the management of the corporation feels that this could be accomplished. Public Information Although the mission statement of Caterpillar does tend to incorporate the attributes that are required for the statement to be worthwhile, it is also important to note that the business must 4 then follow the guidelines that they themselves have set out when they created the mission of the organization. For example, one recent news article mentions that there has been a great deal of recent insider stock trades within the company (Simply Wall St., 2019). While this is not necessarily problematic, it does seem to go against the part of the business’ mission statement that seeks to grow a profitable corporation. Another article published about Caterpillar in the recent past shows that the company has laid off a large number of employees at one of their manufacturing plants in Texas (Mahoney, 2019). Even though layoffs are not inherently bad, and many organizations find themselves in circumstances that demand they be done, these actions do not support the portions of the company’s mission statement that says that the business is focused on developing and rewarding their people. Additionally, such activities would not seem to be encouraging social responsibility, and in fact could be interpreted as doing the opposite. Conclusion One of the most important tasks that the managers of an organization can perform is to determine the best possible strategies for the business to undertake so that it can remain financially and operationally sound for many years to come. The other is to come up with a mission statement that reflects well upon the brand that they are interested in it; it would perhaps make for a better statement to illustrate specific ways in which the management of the corporation feels that this could be accomplished. The best interest of Caterpillar is to align its actions to support the portions of the company’s mission statement that says that the business is focused on developing and rewarding their people. 5 References CIO Wiki. (n.d.). AFI Strategy Framework. Retrieved November 30, 2019, from https://ciowiki.org/wiki/AFI_Strategy_Framework. David, F. R. (2011). Strategic management: concepts and cases. Upper Saddle River, N.J: Pearson. Mahoney, N. (2019, November 1). Caterpillar Inc. announces layoffs at plant in South Texas. Retrieved November 30, 2019, from https://www.freightwaves.com/news/caterpillar-incannounces-layoffs-at-plant-in-south-texas. Simply Wall St. (2019, November 8). Should You Be Worried About Insider Transactions At Caterpillar Inc. (NYSE:CAT)? Retrieved November 30, 2019, from https://finance.yahoo.com/news/worried-insider-transactions-caterpillar-inc110836342.html. Thompson, A. (2018, August 15). Caterpillar Inc. Vision, Mission, Intensive Strategy, Five Forces, SWOT. Retrieved from http://panmore.com/caterpillar-inc-strategic-analysisvision-mission-swot. 1 Strategic Management Research 2 Strategic Management Research One of the most important elements in determining whether a company holds a specific advantage over the competition within its industry would be the strategies that the management of the business consider and employ when making decisions that have an impact upon the organization. Oftentimes when these types of decisions are being made, the potential consequences of the choices must be examined even if they extend far into the future. Competitive Advantage Typically, managers that are forced to consider these effects tend to create their strategic plans to address any matters of concern that might possibly arise due to market trends and other factors. Generally, such considerations will automatically serve to place the company into a more competitive position against its peers, especially if the other businesses do not utilize strategy in this fashion (Gluck, Kaufman, & Walleck, 2014). This is because efficient allocation of resources is often a byproduct of good planning, and this is one attribute that will usually indicate if a company has a competitive advantage. Top Focus When it comes to assessing a company on its ability to gain a competitive advantage through the use of strategic management, one of the factors that can be considered is the way in which the business handles the profits that it makes within the year. For example, examination of the 2018 annual report for Caterpillar indicates that of more than $6 billion in profits for 2018, just over $4 billion were invested back into the business in the form of retained earnings, which accounts for right around two-thirds of the total (Caterpillar, 2018). The remaining one-third, or approximately $2 billion, has been given to the shareholders of the company through the distribution of stock dividends. Although this is not the only result of the company’s strategies, 3 it does indicate that there is a strong desire on the part of its managers to increase accounting profitability, with a slightly lesser demand for the creation of further shareholder value. Value and Cost Drivers The goals and strategies of Caterpillar include being available to provide resources needed for any type of construction project, whether the technology involved is basic or complex (Caterpillar, n.d.). Therefore, one of the major focuses of the company’s management has been automation as it applies to their industry. They recognize that automation as it relates to the construction business is a main component of the future corporate strategy of many organizations that Caterpillar supplies to, and that it will therefore be an important value driver going forward (Caterpillar, n.d.). Although the cost drivers used by Caterpillar internally are not typically reported on outside of the company, it can be assumed that they would also at least partially be related to automation and the new technologies required to meet relevant standards. Competitive Advantage According to documents released by Caterpillar, managers of the corporation believe that one of their most important competitive advantages comes from the use of proprietary elements in the manufacture of its products (Caterpillar, 2018). While it is certainly true that having the only access to certain tools would mean that only Caterpillar could sell the resulting product, there are also downsides to such an advantage. For instance, new future technology could easily render the items made with the proprietary materials obsolete, which would instantly negate any advantage held by the business. Strategic Planning Although the future profits of the corporation are generally on the minds of managers while they are preparing a strategic plan, other factors must also be considered. For instance, if 4 any of the decisions made regarding the plan could result in crossing lines of ethics, they should be immediately discarded and replaced. Even if these issues are not necessarily of an illegal nature, engaging in unethical activities can severely damage the reputation of a business if they are ever uncovered by the public. Corporate Social Responsibility Therefore, the practice of considering what responsibilities a company holds to society and the ways in which they can fulfill them should always be part of a strategic plan. Caterpillar in particular focuses on this aspect of their operations, since they understand and acknowledge that their products must be of very high quality so that they may be used in construction projects that ultimately provide vast benefits to surrounding communities (Caterpillar, n.d.). Ethics and Social Responsibility Although Caterpillar does not ignore the creation of value for both itself and its shareholders, it also has an in-depth focus on economic value and the ways in which it can contribute to such intrinsic worth. Through the generation of a strategy that seeks to balance all these elements, the managers of this company have certainly demonstrated their knowledge of their industry, the communities it serves, and the methods through which their social responsibility goals might be achieved. Conclusion One of the most important elements in determining whether a company holds a specific advantage over the competition within its industry would be the strategies that the management of the business consider and employ when making decisions that have an impact upon the organization. Oftentimes when these types of decisions are being made, the potential consequences of the choices must be examined even if they extend far into the future. 5 References Caterpillar. (2018). 2018 Annual Report. Retrieved December 7, 2019, from http://reports.caterpillar.com/ar/business-review/performance.php. Caterpillar. (n.d.). Our Strategy. Retrieved December 7, 2019, from http://strategy.caterpillar.com/strategy.php. Caterpillar. (n.d.). Company: Strategy & Purpose. Retrieved December 7, 2019, from https://www.caterpillar.com/en/company/strategy.html. Gluck, F. W., Kaufman, S. P., & Walleck, A. S. (2014, August 1). Strategic Management for Competitive Advantage. Retrieved from https://hbr.org/1980/07/strategic-managementfor-competitive-advantage. 1 Strategic Management Research 2 Strategic Management Research Caterpillar Company is an American company that is known for its designs, development, manufacture, and sells machinery. For a company to run forward and make profits in its daily transactions, the management team should have strategies put in place to work toward the achievement of these goals. All businesses and companies need to make profits; this makes the management team work extra hard toward this (Krzus, 2019). In the case of Caterpillar Inc, its short term and long term goals have made it a worldwide recognized company. Below are some of the goals; Short Term Goals The company has set out to make sure that they deliver great goods and maintaining cash flow. The other purpose is that the company aims at creating the best team of people who work towards safety and quality service and product development. The firm aims at becoming a worldwide leading company anywhere; it does its business in the world. The other short term objective is that by the year 2020, the stated organization aims at reducing energy by 50%. Long Term Goals The company strives to create a worldwide supply chain of its products. The company aims are expanding across the world, creating branches in different parts of the world, the long term goal for the company is to make sure that its products are used all over the world. Caterpillar Inc. has acquired 29 organizations in the past five years. These companies have helped the company run smoothly as the different companies specified in various areas of business. Yard Club is the recent company acquired by Caterpillar Inc. Yard Club is helping Caterpillars Inc sell its construction equipment. Kemper Valve & Fittings Corp, this is a company that is making and selling high-pressure valves. When caterpillar ... Purchase answer to see full attachment