Caterpillar Inc. Strategic Management

Caterpillar Inc. Strategic Management

Caterpillar Inc.’s Short-Term and Long-Term Goals

Caterpillar Inc.’s short-term goals are to provide reliable water sources, enhance food production, and create decent housing. The long-term goals are categorized into delivering high-quality results, developing the best team of employees, and becoming the worldwide leader in all the regions it does business. The company intends to provide superior results by increasing earnings per share, cash flow, and operating profit and improving the quality of its products to gain global recognition while implementing a high level of inclusion and safety for its employees to develop the best team. The company also focuses on opening new facilities to expand current operations into the locomotive sector by acquiring Electro-Motive diesel and creating a new product line of mining shovels.

How Mergers and Acquisitions in the Last 3-5 Years Have Contributed to Caterpillar Inc.’s Performance and Affected Its Organizational Goals

Mergers and acquisitions have facilitated Caterpillar Inc.’s growth and expansion in most markets. They have also played a significant role in enabling the company to access credit and bid for large contracts that have boosted its financial performance. The company has also been using mergers and acquisitions to access the resources and finances required to implement its transnational and global strategies. Mergers and acquisitions have also boosted the company’s financial performance by increasing access to raw materials. For instance, the company acquired Weir-Oil $ gas, guaranteeing a constant supply of raw materials required. The main impact of mergers and acquisitions on the company’s organizational goals is limiting future growth prospects because a lot of money has been spent on purchases. Therefore, the company takes time to adjust its financial position after a merger or acquisition, slowing its progress toward achieving financial goals.

The Most Critical Merger or Acquisition That Has Contributed to Caterpillar’s Performance and Success in Achieving Organizational Goals

The most critical merger that has boosted Caterpillar Inc.’s performance is the acquisition of Marble Robot on June 29, 2020. The addition enabled Caterpillar to acquire some of the company’s employees and assets, placing Caterpillar Inc.’ in a better position to leverage technology to help make the required improvements to offer practical solutions to customers (Zacks, 2020). The merger also brought the company closer to achieving its long-term goal of delivering superior quality because applying the technology would help improve the quality of products produced.

The Effectiveness of Caterpillar’s Operational Plan for Global Strategies

The current operational plan for global strategies that Caterpillar Inc. uses is effective for various reasons. To begin with, the program identifies short-term and long-term goals that the company intends to meet to realize the intended planned growth. The plans are vital in guiding the company on what to do to ensure they are completed (Simerson, 2011). This has led to decisions such as forming mergers and acquiring large companies with the resources to actualize the goals. For instance, the acquisition of Marble Robotics has enabled the company to increase its market share by improving the quality of its products, contributing to improved financial performance (Newsfeed, 2021). The operational plan is also practical because it is aligned with the organization’s mission and vision. For instance, the company’s mission of enabling economic growth through energy development and infrastructure is being met through mergers and acquisitions that will allow the company to access high-quality raw materials and get contracts for mega projects focused on economic growth. Mergers and Acquisitions have also facilitated the company’s expansion in different global markets, enabling it to create a world where all the population’s basic needs, such as clean water, shelter, reliable power, food, and sanitation, are met.

References

Newsfeed. (2021, April 9). Caterpillar digs in with the acquisition of marble robotics. Mobile Robot Guide. https://mobilerobotguide.com/2020/06/18/caterpillar-digs-in-with-the-acquisition-of-marble-robotics/

Simerson, B. K. (2011). Strategic planning: A practical guide to strategy formulation and execution. ABC-CLIO.

Zacks. (2020). Caterpillar Acquires Marble Robot, Advances Automation Strategy. Nasdaq. https://www.nasdaq.com/articles/caterpillar-acquires-marble-robot-advances-automation-strategy-2020-06-25

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Review the following terms and concepts discussed this week to prepare for this assignment:

vertical integration
taper integration
backward vertical integration
forward vertical integration
strategic alliances
global strategy
international strategy
innovation

Create a Word doc and title it Strategic Management Research Journal Part 4.

Write a 525- to 700-word response to the following prompts in your journal entry:

Identify Caterpillar Inc.’s short-term and long-term goals.
Evaluate how mergers and acquisitions in the last 3-5 years have affected Caterpillar Inc.’s performance and organizational goals.
Determine the most critical merger or acquisition that has contributed to Caterpillar’s performance and success in achieving organizational goals. Defend your choice.
Evaluate the effectiveness of Caterpillar’s operational plan for global strategies (international, multi-domestic, global-standardization, or transnational). Include supporting research or data.

Include references per APA format.