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Caterpillar's External Environment

Remote Environment

Social- I believe society looks at caterpillar positively. "Caterpillar was recently named to the Dow Jones Sustainability World Index, which recognizes companies that lead their industries in corporate social responsibility, for the third consecutive year. Caterpillar maintains there social responsibility very well. They have programs such as Kids Explore cat equipment in which visually impaired pre-schoolers get hands-on lesson with heavy equipment. The Caterpillar Foundation provides funding and support from a corporate perspective. Formed in 1952, the Foundation has distributed almost $200 million to support education, health and human services, and civic, cultural, and environmental causes.

Technology- Technology is something that definitely helps the caterpillar industry. Caterpillar is the worldwide leader in engine technology. There are always technological advances to be made such as engine design, fuel systems, electronics, and hydraulics, manufacturing processes, chemical products, logistical operations, R&D methods and even business processes. Caterpillar has proven technology of representing over 7,000 patens. ACERT Technology is an example of why Caterpillar continues to be the leader in on-highway engines. Truck engines with ACERT Technology accumulate more than 43 million miles each day. Caterpillar factories ship more than 16,000 of those engines each month. That on-highway record, coupled with Caterpillar's decades of experience in the off-road business, means customers will continue to receive the ultimate in engine performance and machine production.

Industry Environment

Entry Barriers- Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The entry barriers in earthmoving equipment are low. I believe everyone who tries to enter the market in large earthmoving equipment is very inferior to Caterpillar. Caterpillar is caught up on all of the latest technology. I think it would be very hard to enter into this market unless you already have a business that has been in it on a smaller scale. For example John Deere could probably be pretty successful if they entered into the market of large earthmoving equipment. The have been in the tracker business for a long time. Most people have heard of John Deere. John Deere is known for making smaller Earthmoving Equipment that is very reliable. re the world's leading manufacturer of construction an

Competitive Rivalry- Rivalry in earthmoving equipment is pretty intense. Caterpillar's real competitive rivalries are Komatsu, New Holland, Volvo and Cummins Engines. Caterpillar is competitive in many aspects such as Financing, Maintenance & Support, Logistics, Insurance,