Business Model and Strategic Plan of Caterpillar Inc - Case Study Example

Business Model & Strategic plan Affiliation Executive Summary Business Plan Caterpillar Inc. hopes to create a customer-centered service dubbed order-service delivery system. This is an innovative business service that would play a critical role in enhancing brand and positioning strategies of the company in a competitive market. In the wake of modern technology, the innovation and technology team hope to place the company strategically by creating a technology-integrated platform that the consumers would order items and the machinery products are delivered within the shortest time possible. In addition, technology innovation will create a unique market niche that would see the division grow tremendously. Target Market In achieving this monumental strategy, a new division created has its vision, mission statement and values that would help the company position itself within the construction and mining companies. In the United States, there is increased oil and natural gas exploration by big companies. The government commitment in promoting local and international companies guarantees rewards for tenders for innovative companies, this is a potential market. Competition The main threat comes from the Joy Global multi-national company due to its efficient distribution policy and strategy. Other companies such as Deer, Komatsu and CNH technology poses a threat to the existence of this division Financial Projection The company would invest approximately $30 million on projected increased and multiple delivery systems; experts focus on the annual return of $2 billion return on investment (Chou 2013). Table of contents 1.0 Introduction 2.0 Part One 2.1 Caterpillar New Division 2.2 Vision 2.3 Mission Statement 2.4 Values Proposition 2.5 Commitment to Social Responsibility 3.0 Part Two 3.1 SWOT Analysis of the New Division 3.1.1 Internal Environment Analysis 3.1.2 External Environment Analysis 4.0 Part Three 4.1 Assumption 4.1 Change Management Strategy 4.2 Summary of Strategic Objectives 4.4 Communication Plan 1.0 Introduction Caterpillar Inc. remains a competitive dealer in engine and machinery in the United States. In the wake of increased enterprises in innovation and technology, the company hopes to create a new division. The new division will create a new model of customer delivery division that serves to enhance customer service efficiency. Through creation of this new division, the company will achieve tremendous competitive advantage within this competitive industry. In addition, in any machinery and engine company the primary area of enhancing competitiveness is through innovation. Innovation not only enhances competitiveness of a business but also help to improve the image of the business. 2.0 Part One 2.1 Caterpillar New Business Division The creation of order-to-delivery technology presents a new approach in integrating technology in the distribution and purchases of goods. The company new division would be an independent department that together would create a sustained economic growth and improve customer service to unprecedented levels. As a constituent department of the Caterpillar Production System (CPS), the innovation would provide a new organizational department that would link manufacturing processes to the customer service center. In addition, the new division would significantly enhance quick customer-service delivery speed and thus putting the company to the competition level (Bouchard 2014). 2.2 Vision. To create a leading and vibrant customer-centered technological advancement in machine industry that would ensure integrated manufacturing and delivery systems. This new division vision provides a function-specific approach of the overall organizational vision. In the company, the vision is to enhance profitability and grow the business that would benefit the current and coming generation of customers, employees, owners and community. In line with this visionary statement, the new division would focus to enhance customer and community service. 2.3 Mission Statement The division will strive to provide an exemplary, innovative center that will focus on increased customers satisfaction and facilitate a technology-enabled customer service. To develop employees personal and professional growth in order to enable them acquire the competitiveness within and outside organization. Besides, to enhance division performance and create customer-friendly approach that would yield beneficial relationship. The new division mission statement in agreement with the overall company mission of providing quality products and superior support to the market. With innovation and exemplary customer service, this new division would be a new front of guiding the division and the entire organization to prosperity. 2.4 Values Proposition At the division, the values of integrity, transparency and accountability would drive the operations and service expansion. In addition, honesty, creativity and responsibility are key issues that would help these new division employees build vibrant and customer-sensitive services. The values are critical components of this division since they together form the entire organization operation values. In align to organization values of integrity, excellence, family and teamwork, this new division introduces transparency and honest. It will ensure that employees of this new division remain faithful to the need to ensure that customer are not compromised or defrauded. Besides, in order to consistently be among the highest performers, the values of teamwork would form the primary component in the new division operation as envisaged in the companys values. 2.5 Commitment to Social Responsibility The division will create environmentally secure strategies in waste disposal as a social responsibility role. Besides, the division annual returns will, hopefully, help secure companys position in the competitive market and cater for the less-fortunate members of society. The focus on improving drainage and sewerage facilities within its premises will be the primary social responsibility of the division operations. 3.0 Part Two 3.1 SWOT Analysis of the New Division 3.1.1 Internal Environment Analysis Within the new division, there are areas of strengths that would give the new division a recipe to grow. Firstly, the division would build on the already strong product portfolio. The service will only serve to offer a diversity of delivering the product to customers premises. Secondly, the company has over 150,000 thousand employees who are trained with high technological expertise (Rosenbloom 2013). As an area of internal organizational strength, the integration of service would be easily achieved. In addition, Caterpillar Inc. acquired Bucyrus, EMD and MWM these companies have rich technology that would jump-start operation in the new division. However, the new division has few areas of weakness that includes technology system failure may cause erroneous delivery that would create acrimony from the customers. Besides, the system works best for the schooled consumers; placing orders may be complicated and cumbersome for people with limited knowledge. In addition, the customers should have access to the internet and thus the system may not benefit low-income earners thus limiting the market niche. Opportunities of the new division include the increase in mining and exploration markets in both U.S and the globe. Secondly, acquisition of Bucyrus has increased the range of products that would be integrated with the order-to-service new organizational division. In addition, the increase in construction machines orders in 2012 would offer an opportunity to put this division to practice (Zamon 2012). However, there are threats facing this new division. Firstly, the sky-rocketing prices of machinery products. 3.1.2 External Environment Analysis Strengths within the external environment include the company has superior product channels within and outside the U.S market and top-notch services that are the trademark for the organization. Besides, the government support on innovation will spur this new division to greater heights through rewards of government tenders and logistics subsidies. In addition, the technology orientation approach within the construction and building industry presents uncountable opportunity for business growth. Weaknesses on the reduction of Europe market demands in the wake of increased competition. In addition, the new division has no integration policy framework, and this may slow down its operation onset. In addition, the United States Real Estates Market is significantly underperforming and thus the timing of this innovation may not be appropriate. However, the new division has open opportunities to innovation prosperity. The government investment on the natural gas exploration with the internal tender policy presents an opportunity for the company to expand this divisional growth and operational capacity. In addition, the fall in delivery operational capabilities of CNH Global and Komatsu as key competitors presents a monumental opportunity for growth (Chou 2013). The biggest threat to this division is stiff competition that the entire company faces from the Joy Global machinery company within the United States. In addition, the biggest area of operation is mining the industry that is politically determined. In addition, the fluctuation and the high prices of machinery raw materials will pose high risks to profitability of the new division. 4.0 Part Three 4.1 Assumptions The creation of this customer service delivery system works on the assumption that the company would invest on the initial infrastructural requirement. Secondly, the new division would be operational if there is management joint decision. While the benefits of this division appear that it would pave the way to greater opportunities of growth, the management team would wish to inquire the facts and see practicality of the operation. In addition, there is an assumption that there will be a continued operation logistic in place throughout the operation. Failure to incorporate logistic and procurement function into this innovation would lead to enormous losses. 4.2 Change Management Strategy As a new division unleashes a new customer delivery service using integrated order and delivery operations, there would be companys change in procurement and logistics. Firstly, the change will be achieved through provision of training of staff on the operations of the new division. Besides, the change in customer delivery would require policy change on sales and products, delivery to the customers. When the risks of change appear imminent, this new division management will undertake deliberate consultative meetings with technology expert. The adjustment guidelines would be written down as per technology experts in order to avoid customers complains when the system fails. The back-up alternatives on delivery of products would be put in place. 4.3 Summary of Strategic Objective The new division envisions branding of service and product delivery as a key element in putting the company in a competitive advantage position. In addition, the division strategic objectives pay attention to the internal and external determinants as highlighted by SWOT analysis. The important strategy of this division is to employ technology that is reliable, efficient and economical to serve the companys customers better and efficient. In addition, order-to-service innovation would achieve the company strategic objective through creating affordable technology that would respond to the customers inquiries. In addition, through communication strategy, the division will achieve organization integration of managers and employees and gearing their efforts towards profit realization and excellent customer service (Murphy & Laczniak 2013). 4.4 Communication Plan Murphy & Laczniak (2012) states that the new division will create an online consumer inquiry platform that would strive to provide automated answers to each customer. Secondly, the office interoperability systems would link the employees within the division and the entire organization management. In addition, the communication plan would have both downward and upward lines that would develop and nurture two-way communication within and outside the division. References Bouchard, C. T. (2014). The Caterpillar way: lessons in leadership, growth, and shareholder value. New York, NY.: National Academy Press. Chou, D. (2013). Creating a corporate strategy for utilizing supply chain simulation, optimization and visualization. New Jersey: National Bureau of Economic Research. Murphy, P. E., & Laczniak, E. R. (2012). Ethics in marketing: international cases and perspectives. Abingdon, Oxon: Routledge. Rosenbloom, B. (2013). Marketing channels: A management view.. Cincinnati: South-western. Zamon, C. (2012). The lone arranger: succeeding in a small repository. Chicago: Society of American Archivists. . Read More