Question

What are the important relationships among Caterpillar’s value-chain activities? What are the important interdependencies? For each activity, identify the relationships and interdependencies.

Inbound Logistics Operations Outbound Logistics Marketing and Sales Service Procurement Technology Development Human Resource Management General Admin Inbound Logistics Operations Outbound Logistics Marketing and Sales Service Procurement Technology Development Human Resource Management General Admin

Answer 1

Important relationships between Caterpillar's value - chain activities Inbound logistics, operations and outbound logistics, Marketing and Sales, Service, Procurement, Technology development, Human Resources Management, General Admin can be described citing the importance of inbound and outbound logistics for operations. Supply chain is the linkage between inbound, outbound logistics and operations and procurement. The marketing and sales determine the level of service which can be improved using technology and human resources managemet. General Admin has a role in customer services and works along with Human Resources management for ensuring the smooth running of organization dealing with issues like billings, payments, record maintenance and infrastructure management.

The interdependencies exist as timely procurement and inbound logistics is important for operations. Technology is a factor on which the operations, admin , marketing and services and logistics are dependent for enabling communication, machinery, processes, quality standards check, which are essential for success of all the value chain activities.

Inbound logistics is related to operations and procurement and general admin for timely availability, documentation and records of material for manufacturing operations.

Outbound logistics is related to marketing and sales and operations. Depending on the order volume of sales and operations activities, the outbound logistics will work.

Operations is related to inbound logistics, procurement and technology as it needs raw materials and automated operations for manufactuing goods and equipments.

Admin is responsible for providing support to all functions by maintaining infrastructural facilities and keeping up with the requirements.

Marketing and Sales with Service determines the volume and sales and orders booked which leads to procurement, inbound and outbound logistics, operations load .

Human Resources Management and Admin provide support to all activities and determine the resource availability, skills, performance, training, facilities and compensation for the activities involved and aligning the resources with business strategy.

Technology development is essential for all the functions as it enables accuracy and timeliness in activities, coordination and communication, improving the efficiency.