Caterpillar’s Values and Leadership Guide

A list of the company’s values, and a description of what it means to be a leader at the company.

May 2, 2003

Listed below are 1) each of Caterpillar’s values and the company’sdescription of what they mean, and 2) the company’s seven key leadershipresponsibilities and an explanation of each.

Trust--We believe everyone embracing the values of the division will do whatis best for the customer, each other, and the enterprise.

  • Acts consistently to reinforce our values.

  • Expects people to perform their mission and be accountable.

  • Demonstrates openness and honesty in business relationships.

  • Eliminates the fear of breaking away from familiar ways of thinking andacting.

  • Shares information freely in all directions, both good news and bad news.

  • Does not look for or assume motives beyond those stated by others.

  • Respects and honors matters of confidentiality.

Mutual Respect--We treat everyone with dignity and courtesy.

  • Makes everyone feel important and able to make a contribution.

  • Listens without interruption when someone is speaking.

  • Makes no distinction based on position.

  • Accepts or gives apologies when appropriate.

  • Recognizes the uniqueness of individuals.

Teamwork--We recognize the potential for teams to produce superior resultsover what team members could achieve as individuals.

  • Believes that teaming is the balanced involvement of all relevant functions.

  • Aligns personal work and team activities to optimize contribution to thedivision.

  • Accepts and supports team decisions after individual views have beenexpressed.

  • Resolves disagreements within and between work teams by doing what is bestfor the enterprise.

  • Contributes to the success of others by helping others solve problems, meetdeadlines, and work effectively.

  • Openly shares relevant information.

Empowerment--We believe people must work in an environment where they feelenabled to make decisions that contribute to customer satisfaction andperformance of the division.

  • Defines the boundaries of accountability and freedom to act, but remainsflexible to meet changing business needs.

  • Balances decision-making authority and responsibility.

  • Drives decision-making authority and responsibility to the lowest level ofcompetency.

  • Seeks and shares information with others on decisions that affect them.

  • Provides opportunities for employees to develop new skills, expertise, andperspective.

  • Understands how individual work impacts the division’s success.

  • Develops the capability of others through active mentoring and coaching.

  • Risk Taking--We accept and encourage informed risk taking.

  • Nutures risk taking in the workplace.

  • Recognizes failures associated with reasonable risk taking should not bepunished but used as an opportunity for improvement to the underlying processes.

  • Demonstrates the courage to speak freely and challenges the status quo tostimulate change and make decisions to move us forward.

  • Challenges prescribed methods and procedures to better serve the customer.

  • Recognizes the real risk to business success lies in not challenging andimproving processes.

  • Offers recognition for informed risk taking.

Sense of Urgency--We recognize time as competitive advantage.

  • Places a high priority on time. Delivers work on time to both internal andexternal customers.

  • Works to reduce time required to perform assigned tasks. Removes needlesssteps.

  • Errs in the direction of moving too fast rather than moving too slow.

  • Acts quickly to accomplish our goals and meet our commitments.

  • Assesses the situation and acts accordingly.

  • Responds to questions and issues immediately or as soon as appropriateinformation is collected.

Continuous Improvement--We recognize everything we do as a process that canbe eliminated, simplified, or improved.

  • Asks "How can it be improved?" rather than "Does it need to beimproved?"

  • Recognizes the value of change for improvement.

  • Focuses on problem prevention rather than problem resolution.

  • Evaluates changing technology and optimizes its use.

  • Recognizes redundancy and waste must be eliminated.

  • Eliminates unneeded processes (practices/systems) without concern for impacton specific job assignments.

  • Accepts self-development as a process that needs continuous improvement.

  • Recognizes processes as the key to performance improvement.

  • Makes decisions based on need or opportunity, not precedent.

Commitment--We deliver what we promise to each other and to our customers.

  • Recognizes action rather than rhetoric as the true measure of commitment.

  • Promises only what can be delivered.

  • Demonstrates personal commitment to continued learning and upgrading ofskills.

  • Communicates the impact of change to base assumptions used to makecommitments.

  • Accepts obligation to continuous improvement.

Customer Satisfaction--We delight our internal and external customers byexceeding their expectations.

  • Listens to customers.

  • Actively solicits input from customers for important decisions. Alwaysassumes the customer has something to contribute.

  • Always asks, "How can I better serve the customer?"

  • Responds with urgency to customers’ feedback, including both complaints andsuggestions.

  • Delights the customer with quality and service that exceeds competition.Increases customer loyalty to our products by always providing support.

  • Effectively represents the interests of the customers. Is willing to "go tobat" for customers.

Seven key leadership responsibilities and how we carry them out in a mannerthat supports our common values.

1. Develop people to their fullest capacity

  • I have a clear vision of what constitutes growth for the people I serve.

  • I work with employees to create written development plans.

  • I help employees master the skills they need to succeed on the job.

  • I give people freedom to handle work their own way.

  • I take time to show employees new ways of doing work.

  • I delegate assignments to help people stretch or broaden their skills.

  • I accept mistakes as part of the development process and help people avoidrepeating mistakes in the future.

  • I discuss career goals with each employee.

  • I provide honest, realistic answers to career questions and never makepromises I cannot keep.

  • I help people understand the skill requirements and selection criteria forother jobs.

  • I encourage employees to take advantage of internal and external educationand training opportunities.

  • I encourage people to make lateral moves to broaden their knowledge of theorganization.

  • I reward and celebrate developmental achievements.

  • I set an example for others by visibly pursuing a self-development plan.

2. Foster a positive work environment

  • I have a positive outlook.
  • I believe it is my job to help people succeed.
  • I believe that people want to work hard, do their best, and make a usefulcontribution.
  • I am friendly and courteous to everyone.
  • I say "thank you" to employees throughout the day.
  • I look people in the eye when I talk to them.
  • I call employees by their names.
  • I keep my promises.
  • I accept criticism.
  • I admit when I’m wrong.
  • I ask for help.
  • I give credit for good ideas.
  • I listen more than I talk.
  • I maintain a harassment-free work area.
  • I set high standards for quality, performance, and behaviors, and hold peopleaccountable to these standards.
  • I provide people with as much information as I can about our company, ourdivision, Cat products, competition, and other vital issues.
  • I help employees understand the value of the contributions they make. I talkwith employees about their families, hobbies, interests, and outside activities.
  • I encourage people to have fun at work.

3. Adjust leadership style to meet the needs of those whom we serve

  • I understand the four basic leadership styles: directing, coaching,supporting, and delegating.

  • I assess the competency level of each employee on my team.

  • I assess the commitment level of each employee on my team.

  • I use different leadership styles with different people.

  • I use different leadership styles with the same person, depending on theircompetency and commitment to a given task.

  • I change leadership styles as an employee’s or team’s competency andcommitment levels change.

4. Build and support committed and effective teams

  • I understand the goals of our company, our division, and our work group, andI have communicated them clearly to employees.

  • I appreciate the unique background, skills, and perspective each employeecontributes to the team.

  • I use the collective talent and expertise of the people on my team.

  • I help all employees understand their respective roles on our team.

  • I remind employees of our team goals.

  • I explain how our team’s results affect the entire division.

  • I work at building positive relationships among team members.

  • I encourage open communication on the team.

  • I encourage team members to share responsibility for team leadership.

  • I praise individual and team accomplishments and celebrate successes.

  • I share responsibility for winning and losing.

  • I support my team whether we are winning or losing.

  • I discourage behavior that weakens team morale and performance.

  • I encourage employees to serve on multifunctional teams.

  • I set an example for others by serving on multifunctional teams.

5. Empower others to serve internal and external customers

  • I keep people informed about the issues that affect the work group.

  • I solicit input from employees on decisions that affect them.

  • I provide as much information as I can about the work group, the division,and the company.

  • I explain how every individual’s work affects the organization’s success.

  • I challenge people to learn continuously.

  • I ask for ideas and advice.

  • I remove roadblocks.

  • I provide appropriate resources to get a job done.

  • I expect and encourage people to manage their own responsibilities and findtheir own solutions.

  • I trust people to make good decisions without my help.

  • I accept and support team decisions that are not made the way I would havemade them.

  • I allow people to fail, but assure that the failure is not devastating to theperson or the organization.

  • I provide adequate and appropriate training.

6. Provide feedback that helps people grow

  • Developmental feedback

  • I work with every employee to create a development plan.

  • I give positive feedback when employees show developmental progress.

  • I modify employees’ development plans as they reach their goals.

  • I give developmental feedback and performance appraisals at separate times.

  • I give developmental feedback more than once a year.

  • I ask for employee input in my personal development plan.

    Informal feedback
  • I say something positive to every employee in my group every day

  • I identify attitudes or behaviors that I would like to perpetuate.

  • I look for opportunities to reward behavior and performance consistent withOur Common Values.

  • I strive to reinforce positive behavior immediately after it happens.

  • I praise employees for specific behaviors or achievements.

  • I give positive reinforcement for everyday work effort--not just exceptionalperformances.

    Disciplinary feedback

  • I apply discipline consistently.

  • I meet privately with employees to discuss problems.

  • I try to resolve problems before they enter the formal disciplinary process.

  • I explain to employees what constitutes reasonable performance and behavior.

  • I tell employees why expected levels of performance and behavior areessential to our team.

  • I let people know when their performance or behavior is not meetingexpectations.

  • I explain what needs to be done to bring performance or behavior toacceptable levels.

  • I try to get employees to accept responsibility for changing their behavior.

  • I seek the employee’s agreement to resolve the problem.

  • I work with the employee to create an action plan for resolving the problem.

  • I clearly state the consequences of failing to meet expectations.

7. Pursue self-development

  • I have a written plan for self-development.

  • I discuss personal developmental issues with coworkers at all levels of theorganization.

  • I meet regularly with my supervisor to talk about developmental opportunitiesand progress.

  • I seek out new responsibilities and new approaches to problem solving.

  • I take advantage of internal and external education and training activities.

  • I accept lateral moves and cross-training assignments.

  • I use the 360-Degree Values Feedback Process to guide my development plans.

  • I take advantage of the Division Leadership Upward Feedback Process.

Reprinted from courtesy of Caterpillar Inc. Also with permissionfrom....AndDignity For All: Unlocking Greatness with Values-Based Leadership, Despain, J.and J.B. Converse, 2003. Upper Saddle River, NJ: Financial Times PrenticeHall.

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