Enterprise Strategy

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Operating &
Execution
Model

We’ll run our company using the O&E Model — sharpening our focus on execution by changing both our metrics and governance. 

- Jim Umpleby,
Caterpillar CEO

At the heart of our enterprise strategy is the Operating & Execution (O&E) Model, a strategic framework to identify areas of the business that either create or consume the most value. Using the O&E Model as a guide, we gain a deeper understanding of where we have a competitive advantage, which is key to generating high returns. As a result, we allocate resources to those areas of our business that create or have the potential to create the most growth or improvement. This allows us to make swift, strategic choices so that we prioritize business opportunities with the greatest value.

Our Values
In Action

Though our strategy evolves with a changing marketplace, Our Values in Action are timeless and constant — guiding our conduct with customers, partners and one another around the world. We live Our Values in Action everyday, defining not only what we do, but how we do it. Our Values go beyond compliance to create a work environment in which we take pride, making the world better not only through our solutions, but also through our actions.

Integrity

We align our words with our actions and
deliver what we promise.

Excellence

We set—and achieve—ambitious goals to make the world a better place.

Teamwork

We believe diverse opinions, experiences and backgrounds make us a stronger team.

Commitment

We accept responsibility for each other, our customers and our communities.

Sustainability

We help build a future in which all people’s
basic needs are met.

People

The diversity and commitment of our people have always been the heartbeat behind our success – what enables us to fulfill our purpose of helping our customers build a better world. An aspirational Caterpillar Experience defines what it’s like to work here every day. This helps us attract and retain the best talent and ensure a positive and inclusive employee experience.

Learn more at caterpillar.com/careers

The Caterpillar Experience

Winning
Culture

High-performing teams and leaders make for a winning global business.

Meaningful
Work

Work that matters—and recognition for a
job well done.

Personal
Growth

A chance to grow skills
and competencies that
define careers.

Empowered
Environment

A belief that diverse
ideas lead to
deeper understanding.

Partners

Caterpillar has long maintained a collaborative working relationship with our dealers, distributors and suppliers. Our distribution partners’ expertise and capabilities have made our network the best in the world – a competitive advantage and differentiator for our products and services. We work closely with our partners on everything from product development to aftermarket solutions. We’re further strengthening relationships through better prioritization, integrated planning and quality execution to create more value for our customers.

Numbers from Year-end 2016

Customers

Our customers are the reason we’re in business. They use our products to build a better world. Focusing on the end customer has always been and will always be our highest priority to ensure they are more successful working with Caterpillar than with our competitors. Now, we’re intensifying that focus around a rapidly evolving set of customer needs, working to provide different products for different application needs. By investing in areas such as an e-commerce platform and capturing more data to generate insights, we aim to increase customer value and loyalty over the life of our relationship.

Operational
Excellence

Operational Excellence has always been a part of our foundation. Over the years, we continue to build upon core capabilities—a safety-first culture, product reliability and durability, efficient and Lean operations and a competitive, flexible cost structure—so we're positioned to consistently deliver strong operational performance through business cycles. These foundational strengths are what many have come to expect when they think of Caterpillar.

Safety

Our industry-leading safety levels reflect our commitment to ensure every employee, everywhere, returns home safely every day.

Quality

High quality levels are key to our CAT® Brand Promise, and what our customers expect.

Lean Manufacturing

A strong foundation built on 6 Sigma and the Caterpillar Production System (CPS), translates into Lean execution to eliminate waste and drive efficiencies.

Expanded
Offerings

Understanding our customers begins with knowing where and how they use our products and services, including the applications, attributes and performance capabilities that matter most to them. Our focus on expanded offerings includes how we develop and deploy new technologies, our growth in emerging markets and investments in products targeted to distinct customer segments. Using the O&E Model as our guide will help us identify which expanded offerings provide the best opportunities for profitable growth.

Three Emerging Market Opportunities

Africa and Middle East

Nearly 300 construction projects valued at US$50 million or more are underway in Africa.

India

India’s national railway is laying 9.5 kilometers of tracks—every single day.

China

By 2020, China plans to build up to 60 new airports.

Services

Today, digital technologies are expanding the solutions we can offer customers beyond our traditional products, parts and services. These technologies also are transforming how we deliver our traditional offerings. The growth of services is a core focus area of our strategy and speaks to the support we can provide to customers associated with our products — from aftermarket parts to analytics to machine rentals and beyond. Through a more integrated services philosophy, we provide a more holistic customer experience and drive customer loyalty.

Profitable
Growth

This is a tremendous time to be a part of Caterpillar. It’s our opportunity to unlock the value within our current businesses and profitably grow. I’m confident our best days lie ahead. 

- Jim Umpleby
Caterpillar CEO

When it comes to our success, profitability and growth go hand in hand – both are necessary for our long-term success. To maintain our competitive position, we need not only growth from increased sales and revenues, but also growth from selling products and services that generate higher earnings. This is why profitable growth is at the center of our strategy. Using the Operating & Execution Model as our guide to understanding where and why we’re profitable, we allocate our resources and make strategic investments to enable profitable growth. With profitable growth, we invest in our company and improve our position as a global leader — providing better solutions to customers, more opportunities for our dealers to expand in new markets and the ability to reward and develop our people more. When our business wins and we grow profitably, it benefits our customers, our partners, our people and our shareholders.

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