MPM701A Business Process Management

In this assignmnet task you need to do these three points.

1. Micro environmental influence : company , customer, collaborators and competitors ( separately) , identity the stakeholders of the company.

2. Importance of stakeholders in decision making for the company

3. Swot analysis of the company .

Case Study: Caterpillar

The case study relates to the concept of foreign direct investment (FDI) and its implications on the modern international business ecosystem in terms of both economic and individual human impact. Key concepts that are covered include offshoring, reshoring, international product life cycle theory, globalization, organizational sustainability and human value assessment. Theoretical implications are provided to explain historical context and the development of the modern international economic ecosystem. All of these concepts are viewed through a lens of “fairness” and “justice” in an attempt to determine how Multinational Enterprises (MNEs) FDI strategies impact on the various stakeholders. The case study highlights issues that arise from companies solely pursuing the reduction of production-cost strategies. The key learning’s from this case study are provided in the business implications section that outlines recommendations for MNEs on establishing a more ethical international business practice.

The Industry challenge - Ethical Dilemma in International Business

As result of globalization, improved methods of communication and adjusting to new economic challenges Multinational Enterprises (MNEs), to maximize profits, seek out and develop markets that have lower labour costs, whilst the significance of human capital and organizational sustainability appear to have become back burner issues. With an international economic ecosystem that appears to be increasingly intertwined and fragile, the effects of domestic economy related decisions appear more likely to make an impact at an international level. For example the Global Financial Crisis (GFC) that originated in the United States quickly spread to the entire world.

Company Overview

Caterpillar was originally founded in 1928 and was the result of two different companies joining together, Holt Manufacturing Company and the C.L. Tractor Company. At the time of the merger both companies had pioneered the engineering of gas powered tractors. Both World War I and World War II positively influenced the growth of the company as many of their products were in use during the wars, an example of this is the M4 tanks used by many of the allied countries used motor graders, generator sets and diesel engines manufactured by the Caterpillar company. By 1950, Caterpillar had taken its first move towards offshoring by setting up a production plant in Great Britain. This offshoring effort was an attempt by Caterpillar to avoid the tariffs and import taxes associated with selling into many European markets. As such, Caterpillar continued to expand its operations to strategic locations around the world in an attempt to better serve and capitalize on the international market.

1. Micro-environmental influence

• The company Caterpillar, was founded in the year 1928, as a result of two companies joined to work together. The two companies were Holt Manufacturing company and the C.L. tractor company. Caterpillar serves the customers around the world, include the building contractors from the European and Chinese markets. The customers include landscape, construction, and agricultural markets.

• Caterpillar has built strong relationships with their customers. The building construction groups helped the company to create buyers personas for the customers of their impact.

• The company believed that their success was their customers, as they established healthy and emotional connection with them. Thus, Caterpillar made strategic decision to sharpen their customer-centric focus (Caterpillar, 2018) .

• The Caterpillar major collaborators included, the construction companies in the European and Japanese markets. The company acquired many other firms or assets such as Trackson, Rolls-Royce UTC, Lotus, Jaguar and others. One of the major competitor of the company was Komatsu, a firm in the Japan.

• The competitive firms include from the countries like Japan and Netherlands. Important stakeholders included construction and mining suppliers, customers, distributors,  and the firms providing raw materials to the company (Schaefer,Walker and Flynn, 2017).

2.

The company caterpillar, was effective in carrying their operations smoothly and building strong relationships with their collaborators such as NASA for technology advancements. Thus, the major stakeholders such as suppliers, government, customers, and the other dealers company play a major role in effective decision- making of the company. As the company provide value to their customers, and encourage profit -making, therefore, it represents that they affect the decision-making of the company. Stakeholders contribute in strategic decision making, as their interest and values determine their commitment towards organisational practices. Therefore, their involvement in decision-making activities is essential and beneficial to the organisation in long-term (Williams, 2018) .

3. SWOT Analysis

• To discuss strengths of the Caterpillar, it can be stated that the company has strong brand image, and large-scale assets, and wide distribution network in the market (Gaurav and Shainesh, 2017) .

• Weaknesses of the company includes slow pace of innovation, and limited connections in business markets, decreasing revenue. For an instance, Caterpillar though operates in Chinese market, lacks in terms of an extensive network of distributors (Shrestha, and Bawa, 2015) .

• Growth and expansion states the opportunities to increase revenue and profits, especially in Asia.

• Chinese manufacturers, imitates the Caterpillar’s strategies. Imitation has become as the serious issue in the advent of local and regional firms copying the original designs of the global firms in the industry.

• The threats also include the aggressive competition from the Japanese companies, could integrate robotics into their products posing threat to the company (Hutzel and Lippert, 2014).

References

• Caterpillar (2018) History of  Customer focus. [online] Available from: https://www.caterpillar.com/en/news/caterpillarNews/history/ahistoryofcustomerfocus.html [Accessed 24/10/18].

• Gaurav, R. and Shainesh, G. (2017) The changing face of customer centricity. In The PalgraveHandbook of Managing Continuous Business Transformation (pp. 175-187). United Kingdom: Palgrave Macmillan.

• Hutzel, T. and Lippert, D. (2014) Bringing jobs back to the USA: Rebuilding America’s manufacturing through reshoring. United States: Productivity Press.

• Schaefer, D., Walker, J. and Flynn, J. (2017) August. A Data-Driven Business Model Framework for Value Capture in Industry 4.0. In Advances in Manufacturing Technology XXXI: Proceedingsof the 15th International Conference on Manufacturing Research, Incorporating the 32nd National Conference on Manufacturing Research, September 5–7, 2017, University of Greenwich, (Vol. 6, p. 245). United Kingdom: IOS Press.

• Shrestha, U.B. and Bawa, K.S. (2015) Harvesters’ perceptions of population status and conservation of Chinese caterpillar fungus in the Dolpa region of Nepal. Regional environmentalchange, 15(8), pp. 1731-1741.

• Williams, K.B. (2018) The Caterpillar Way: Lessons in Leadership, Growth and Shareholder Value and Demographics and the Demand for Higher Education. Collegeand University, 93(3), p.55.