experiential exercise
Caterpillar is a leading firm in the construction and
mining equipment industry with extensive global
operations. It has approximately 130,000 employees,
and its revenues were $67 billion in 2012. In addition to
its manufacturing and logistics operations, Caterpillar is
1.
well-known for its superb service and parts supply, and it
provides retail financing for its equipment.
Below, we address several questions that focus on
Caterpillar’s value-chain activities and the interrelationships
among them as well as whether or not the firm is able to
attain sustainable competitive advantage(s).
Where in Caterpillar’s value chain are they creating value for their customer?
Value-Chain Activity
Yes/No
How Does Caterpillar Create Value for the Customer?
Primary:
Inbound logistics
Operations
Outbound logistics
Marketing and sales
Service
Support:
Procurement
Technology development
Human resource management
General administration
General
administration
Human
resource
management
Technology
development
Procurement
Service
Marketing
and sales
Outbound
logistics
Operations
What are the important relationships among Caterpillar’s value-chain activities? What are the important
interdependencies? For each activity, identify the relationships and interdependencies.
Inbound
logistics
2.
Inbound logistics
Operations
Outbound logistics
Marketing and sales
Service
Procurement
Technology development
Human resource management
General administration
3.
What resources, activities, and relationships enable Caterpillar to achieve a sustainable competitive advantage?
Resource/Activity
Is It Valuable?
Is It Rare?
Are There Few Substitutes?
Is It Difficult to Make?
Inbound logistics
Operations
Outbound logistics
Marketing and sales
Service
Procurement
Technology development
Human resource management
General administration
CHAPTER 3 :: ASSESSING THE INTERNAL ENVIRONMENT OF THE FIRM 99