Signature Assignment: Strategic Management Research Project Presentation

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Running Head: STRATEGIC MANAGEMENT RESEARCH JOURNAL PART 3

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STRATEGIC MANAGEMENT RESEARCH JOURNAL PART 3

Strategic Management Research Journal 3

Assess whether Caterpillar Inc. is using the appropriate measures to verify its strategic effectiveness.

Caterpillar Inc. uses appropriate criteria to evaluate its strategic effectiveness. The company is the leading manufacturer of quarrying, engineering improvement machinery, and both turbines and petroleum-driven engines. Caterpillar Inc uses an approach that mainly involves providing their esteemed customers appropriate solutions to their problems. The main focus of the company is the quality of its product rather than being money-oriented. This has relatively played a significant role in ensuring the company is ranked one of the best worldwide. Quality being the driving force of the company, it provides the all procedures are managed effectively, and at the same time, the company achieves its profit. Also, the use of quality as a driving force has ensured that the company's loyal customers achieve higher satisfaction rates (Lysak et al., 2020).

The company has a unit known as resource utilization and management in charge of three primary functions. The first function is managing the economic growth through quality and market research. The second function is to expand the company's market operation to reach more consumers. Lastly, the unit focus on laying a concrete market ground so that they may increase the loyalty of their customers towards their products. The company's success lies in the establishment of a scaled economy, cost-effective products, provision of quality, and incredible products. These factors have continuously given the company its competitive advantage in both local and global markets.

Summarize Caterpillar Inc.’s organizational structures

The company uses a simple but effective organizational structure. The structure is more of a hierarchical one that oversees the company sales of products and operational procedures run smoothly. The structure has also contributed to the success of the management focusing on one production line making the company operation easier and effective.

Determine whether Caterpillar Inc.’s organizational structure is considered a traditional organizational structure or a Holacracy

The organizational structure of caterpillar Inc. is holacracy. This is because the company uses new technological advancements and methods to make changes to its management structure. The company's governing body consists of the board of directors who are selected in a completely autonomous and free process. The governing body is composed of outsiders who are not stakeholders in the company. This body consists of a chief executive officer who governs presidents distributed in the company's five operating regions. The five presidents oversee their vice presidents, who are tasked with managing the company offices and showcasing sites.

The company also depends on short-chain management apart from its hierarchical management to innovate new business ideas and manage the company operations in mismanagement by the hierarchical managers. This is known as decentralized leadership that is aimed to attract more consumers and come up with innovative ideas. The mining department has undergone some changes where it has been reconstructed to focus on all global ideas by uniting its departments such as operations, marketing, and the resource globally (Lynch and Haskins., 2019). Decentralization management makes the company organization structure considered holocracy, which is vividly seen by the circulation of the leadership positions rather than traditional administrative which restrict the circulation of authority.

Justify why Caterpillar Inc.'s leadership needs to study and understand the company internal and external environment

The importance of this is that it will ensure better performance and sound management of the company. Understanding both internal and external environment managers will be in an appropriate position to make informed prospects and decisions. Managers will be able to plan for future operations of the company, identify areas that need improvements and the company's weakness. Understanding these environmental factors will help in ensuring the company achieves reliability and sustainability in its operation market. This can be achieved by conducting a SWOT analysis, creating individual and company goals, and utilizing the company resources.

Evaluate Caterpillar Inc.’s competitive position and how they have responded to shifts in the external and internal environments

The main competitive advantage of the company is its quality products and services. This has made them attract a significant number of customers who have remained loyal to the company. The company has responded to shifts in the external and internal environment through value creation to ensure the company remains relevant to the global and local markets. The company has reliable and appropriate strategies to ensure it stays functional when a calamity strike.

Recommend strategies in operational changes to support Caterpillar's strategic plan, future business decisions, and business performance improvement.

The company should stop depending on the United States market and focus on shifting its market operations to other parts of the world. Second, the company should adopt and implement current technological advancements in its operations and manufacturing processes. This will help the company to have a competitive advantage and, at the same time, achieve customer satisfaction.

References

Lynch, L. J., & Haskins, M. E. (2019). Caterpillar Inc. Taps the Chinese Bond Market. Darden Case No. UVA-C-2418.

Lysak, A., Marmon, R., & Schoen, E. J. (2020). Whistleblowing and Caterpillar Inc.’s Swiss Tax Strategy. Journal of Business Ethics Education, 17, 237-250.