Supply Chain Management for Caterpillar: Operations Strategies and Lean Management

Running head: SUPPLY CHAIN MANAGEMENT
Supply Chain Management
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Introduction
Caterpillar is one of the leading firms that exercise its operational functions in the field of
manufacturing and production of equipments, engines and locomotives that are associated with
mining, construction, diesel and natural gas. The firm manufactures diesel electric locomotives,
turbines and other machineries and equipments that are associated with mining. Besides these
products, the firm has also recently taken up the business of providing financial services
(cat.com, 2018). As the company has a long history and record of innovation in terms of
technology and customer solutions, operations strategies governing supply chain is very
important and crucial for the firm. This report tends to analyze and evaluate the various
operations strategies that the firm can use to align the supply chain with the marketing functions
existing.
Resources Required
As the firm manufactures equipments and machinery that are used for agricultural and
mining purposes, the resources required by the firm include the most updated forms of
technology in addition to the large infrastructural requirements (Brewster 2017). Apart from
these the other resources required by the firm include a meticulous network of distributors and
logistics that will help in maintenance of proper relations with the suppliers as well as other
stakeholders.
Marketing Functions
The marketing functions that are used by Caterpillar include the market research and
other promotional activities and initiatives that help the firm to figure the array of products that

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will help it to gain and capture a larger share of the market and hence increase its cohort of target
customers.
Operations Strategy Integrating the Resources and the Marketing Functions
The operations strategy used by a firm in its functioning are primarily involved with
reaching the set objectives and goals for the quarters or for that financial year. The two main
types of operations strategies used by the firm in reaching its objectives of higher revenue
generation as well as capturing a higher customer base include both corporate strategies and
customer driven strategies. The other most important strategy used by the firm includes
development of newer products and services. These strategies help in the amalgamation and
integration of resources utilized by the firm along with marketing functions. The corporate
strategies used by the firm help in efficient and easy networking and cohesion between all the
departments and additional resource relations present within the firm. The firm is also actively
involved in utilizing and implementing corporate strategies that help in capturing higher sections
of the target market by use of disruptive business models that help in catering to the needs and
demands of customers and the changing trends of the market. The last set of operations strategy
used to cater to the changing technological innovations taking place in the firm as well as in the
market include, manufacturing and providing increased research and development of goods and
services that are new and will help in capturing higher share of the market as the firm makes sure
that they are the only firm in the market producing the newest variety and quality of goods.
Managerial Skills Required
The managerial skills that is required for efficient working of the supply chain amidst the
rapidly occurring changes in the spheres of technology and commerce include the skills that are

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needed to be present in the new era of management supply (Jacobs, Chase and Lummus 2014).
Some of these skills include concepts of project management, accounting costs efficiently, and
technical viability. In this context the ability to understand financial statements and work on the
same is also very important. The other set of management skills include understanding of e-
business plans and e-procurement plans. The duties of supply chain managers are varied and also
include the responsibilities of trouble shooting and problem solving on an everyday basis
(Christopher 2016). Especially in the context of the functioning of Caterpillar, the
responsibilities of the supply chain managers include understanding and evaluating global issues
or situations that affect the smooth functioning of the already existing branches or that affect the
expansion of the firm into other countries (Schönsleben 2016). Essentially as Caterpillar is
concerned and involved with machinery and equipments for earth moving and agriculture, the
core responsibilities of the managers demand more than just logistics handling and inventory
purchasing. As the firm is currently facing issues of emissions from the vehicles produced from
the customer feedbacks obtained, the complete set of responsibilities and accountabilities facing
the supply chain managers are enlisted and described as follows:
 Ensuring the production quality is maintained and ensured with the new products and
services that the company is now producing or planning to produce. It is one of the most
crucial responsibility for the managers to propose and monitor both research and product
designs for any new services or products that the firm is planning to launch for the first
time in the target market.
 Ensuring that issues of leakage and other disruptions do not happen in the context of
inventory or other raw materials storage