caterpillar model bpsm

20
PRESENTED BY : Neha Parekh (13301) Madhuri Kudekar (13309) Shraddha T emgire (13320) Vijay K Bokde (13338) Apoorva Daydar (13341) Shantanu T upe (13349) Lt.Col. Mangesh Wankhede (13361) Lt.Col. Vijay Khedekar (13362)

Upload: abhijeet-arvind

Post on 02-Jun-2018

218 views

Category:

Documents


0 download

TRANSCRIPT

Page 1: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 1/20

PRESENTED BY:

Neha Parekh (13301)

Madhuri Kudekar (13309)

Shraddha Temgire (13320)

Vijay K Bokde (13338)

Apoorva Daydar (13341)

Shantanu Tupe (13349)

Lt.Col. Mangesh Wankhede (13361)Lt.Col. Vijay Khedekar (13362)

Page 2: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 2/20

World EME Industry in 1981

About CAT CAT’s strategy till 1980s 

Competition

Need for new strategy

PESTEL Analysis Michael Porter’s Five Forces Model 

SWOT Analysis

Suggestions and Key Learning

AGENDA

Page 3: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 3/20

1981, the construction industry along with EME usage

represented nearly 70% of the total dollar sales Excavators, bulldozers, graders, loaders of highway

tractors and haulers

EME demand was doubling throughout 1973-1980s

Mining/ construction industry – 60% of EME market

Low cost labour method created competition

EME industry focussed on improvements to existingproducts

WORLD EME INDUSTRY IN 1981

Page 4: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 4/20

Based in Peoria, Illinois

Two divisions

1) Earth moving and construction machinery and

related equipments

2) Engines for construction and power generating

systems.

Largest manufacturer of EME- Large geographical base

and broad product line

Great success due to world war II – triple sales

ABOUT CAT

Page 5: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 5/20

Extending its market globally – plants in over 8

countries Providing high quality extensive product line backed by

efficient service

Self-sustaining Dealership Network

100 % ownership of its subsidiaries Recognizing post-war opportunities

Manufacturing excellence & Quality Control

Uniform pricing strategy

Hired employees mostly from the US

CAT’S STRATEGY TILL 1980s 

Page 6: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 6/20

53%

15%

10%

6%7%

5% 4%

Market Share (%)

Caterpillar

Komatsu

J.I. CASE

FIAT-ALLIS

JOHN DEERE

INTERNATIONAL HARVESTER

CLARK EQUIPMENT

COMPETITION

TOTAL ACCOUNTED FOR MORE THAN 90% OF THE SALES.

Page 7: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 7/20

Worldwide demand had doubled

Intensity of competition increased

LDCs increased their rate of construction activity

Saturation in domestic market

World contractors were becoming better placed than

US contractors to perform contract

Hardships due to enormous labour union strikes

NEED FOR NEW STRATEGIES

Page 8: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 8/20

Healthy environment in home country, USA

World War 2 provided heavy growth opportunities for EME

Industry.

Entry in Japan was under strict constraints: Caterpillar -

Mitsubishi alliance was delayed till Komatsu was in strategic

alliance with Cummins over licensing.

Governments of Countries like India, African nations stressedon partial manufacturing within national borders.

Joint Ventures: Caterpillar established subsidiaries in host

countries to get best deals with Governments to reduce their

tax liabilities.

Political

Page 9: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 9/20

Joint Ventures and Risk Reduction – Subsidiaries with

100% or maximum possible ownership

Higher wages of Employees and Workers in developed

markets reduced the Profit margins for Organization,

further pushing organizations to raise premium in

Pricing. Excessive Inventory Storage had associated carrying cost

which further pushed price higher.

Economical Environment

Page 10: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 10/20

Depleting market in Middle East. Softening of Oil Prices

led to low construction activity.

Global Debt Crisis of 1981. LDCs Mexico, brazil,

Argentina, Nigeria facing liquidity crunch.

Fed Reserve Policy leading to higher interest rates

affected the Construction industry.

Strengthening USD, adverse for Exports from US.

Economical Environment

Page 11: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 11/20

Developing Countries and specifically the African

nations were more Labor oriented.

Organizations stressed high on loyalty were consideredConventional in operations.

Ghetto creations( Clubbing housing and workinglocalities) observed.

Management- Labor Relations in Organizations werechallenged.

Social Environment

Page 12: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 12/20

During War, US military standardized usage of CAT

equipments.

Technology development and increase in Automation -

Result: electronically controlled equipment.

Post war, US military left heavy machinery in countries

while their return. This led to locals learning usage andmaintenance of Cat machinery.

However Caterpillar was mocked to have laid back

Technology as compared to Komatsu.

Technological Environment

Page 13: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 13/20

Opportunities seen in ASEAN, Australia, Japanese

markets.

LDCs required extensive infrastructure however faced

financing problems.

Other MNCs ready to take dealership of CAT in and

outside US. Ex: Unilever in Africa.

Ecological Environment

Page 14: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 14/20

USFCPA: US Foreign Corrupt Practices Act- Prohibited

Caterpillar from unethical activities like Bribery.

Different Nations varied on the Legal standards adopted

for Business. Joint Ventures with percentage of

Ownership was point of focus.

Tax policies depended on ownership and Investments.

Legal Environment

Page 15: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 15/20

MICHAEL PORTER’S FIVE FORCES

MODEL

Rivalry

High

Threat ofnew

entrants

Low

Bargainingpower of

buyers

Moderate

Threat ofsubstituteproducts

Low

Bargainingpower ofsuppliers

Moderate

Page 16: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 16/20

SWOT ANALYSIS

STRENGTHS

Dealership network

Broad product line

Large Geographic

BaseOperational efficiency

High quality products

WEAKNESS

Fewer markets

Few global managers

High Overheads andsetup cost

Labour Relations

OPPORTUNITIES

Emergingmarkets

Diversification

THREATS

CompetitionUncertain Economic

environment

Currencyfluctuation

Page 17: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 17/20

Page 18: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 18/20

Hire local employees with local knowledge to work in a

particular country.

Concentrate on growing markets – far east, Australia,

ASEAN countries, South Korea, Japan and Taiwan

Full capacity utilization of existing plants to reduce

overheads

SUGGESTIONS

Page 19: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 19/20

Page 20: Caterpillar Model Bpsm

8/11/2019 Caterpillar Model Bpsm

http://slidepdf.com/reader/full/caterpillar-model-bpsm 20/20

THANK YOU!