Caterpillar is the world's largest manufacturer of heavy equipment. It markets its products in construction, mining, agriculture, and forestry. Recent acquisitions include Bucyrus. Competitors include Deere & Co., Komatsu, and Joy Mining. The company began in the late 1800s and saw growth throughout the 20th century through expansion globally and a focus on product quality and service. Today Caterpillar operates worldwide with over 300 machine models and offers financing, parts, and training services through its dealer network.

2. Company Overview
 World’s largest manufacturer of heavy equipment.
 Markets include construction, mining, agriculture, forestry, and
many others.
 Recent acquisition of Bucyrus.
 Competitors-
 Deere & Co., Komatsu Ltd., Joy Mining, CNH Global
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3. Additional Brands
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4. History of EME
 World’s largest manufacture of earth moving equipment (EME)
 The EME industry began in the late 1800’s with the development
of steam powered equipment.
 The demand for EME depended on the increase at which
machines were substituting manual labor.
 Demand was higher in developed countries (US) Demand
structure changed due to the changing oil demands within the
Middle Eastern countries.
 This lead to an increase with construction activity.
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5. EME Industry
 1981, the construction industry along with EME usage
represented nearly 70% of total dollar sales
 Excavators, bulldozers, graders, loaders off highway tractors
and haulers
 EME demand was doubling throughout 1973-1980’s
 Mining / Construction industry -60% of the EME market
 Low cost labor method created competition
 EME Industry focused on improvements for existing products
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6. Sources of ‘CAT’ success in EME
Industry
 Differentiation strategy
 Extending its markets globally- plants in over 8 foreign
countries
 Providing high-quality, extensive product line backed by
efficient service
 100% ownership of its subsidiaries (resists joint ventures)
 Recognizing opportunities in external environment (postwar
opportunity)
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7. Early Growth
 Started in 1883 in Stockton, California as "Stockton Wheel
Company"
 Founded by the Holt Brother
 1905- first major public contract, the San Francisco Cable Car
 1909 opened a second plant in Peoria, Illinois
 Aided the US and their allies in WWI
 Merged with C.L. Best Tractor Company to from Caterpillar
Tractor Company in 1925
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8. Expansion
 Headquarters moved to Peoria, Illinois
 After WWI, European nations became interested in Caterpillar
machinery
 Expansion to other countries, ex. India
 Led to the formation of different brands within Caterpillar
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9. Product & Services
Product-
 Machines: the product line consists of more than 300 machines
 Engines: High speed diesel engines
 Electronics: Technologies, systems and components needed to
operate in the harshest environments
 Turbines: Mid-range industrial gas turbines
 Replacement parts
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10. Product & Services
Services-
 Castings: Caterpillar’s Cast Metal Organization
 Maintenance & Support: Caterpillar dealer service
 Training: Caterpillar University
 Financing & Insurance: “The best financing solution for your
business.”
 Rentals
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11. Business Philosophy
 Caterpillar focus on its role in the worldwide, and Caterpillar
never stop self evolving to be the best in business.
 Caterpillar cooperate with local culture and government.
 Caterpillar focus on safety in the workplace than its profit.
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12. Business Philosophy
 Caterpillar’s product development.
 Caterpillar’s 4 steps product creation process:
 Strategy definition
 Product development
 Manufacturing execution
 Product support
 How does Caterpillar achieve high speed for technology
development?
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13. Worldwide Coverage
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14. Business Methods
 Caterpillar have two operating systems, one for Caterpillar and
another for Caterpillar’s dealers.
 Caterpillar using Six Sigma and Caterpillar Production System to
control company's operation.
 Caterpillar’s dealers using Dealer Business System for their day
to day operations.
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15. Management
 Dealers are using Dealer Business System for supply chain
management.
 Four main modules for Caterpillar’s risk management.
 Caterpillar’s corporate governance structure.
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16. Marketing strategy
 New vision 2020 strategies:
 Improve products and services
 Achieve more advantage by improving Caterpillar’s
distribution system
 Build superior Caterpillar business model
 Caterpillar’s marketing strategy is to treat its customers like
human beings
 Caterpillar’s global strategy is to provide different product and
service standard with its competitors.
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17. Financial Analysis
 Trend Analysis
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18. Financial Analysis
 Comparative Analysis
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19. Competitor Overview
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20. Competitor Overview
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21. Recommendation
 Increased emphasis on mining side of the business because of
the fact that emerging markets will require coal and other
resources.
 Expand their dealership facilities into the Asia and Middle
Eastern market.
 Enhance product reliability.
 Support customer relations through repair & maintenance
scheduling.
 Develop relations with outside manufactures and designers.
 Launch rental and lease arrangements.
 Increase their production systems to reach the level of their
competitors.
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