HR Organizational Excellence Howard H. Gibson Intellectual Capital Director CIS

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1 HR Organizational Excellence Howard H. Gibson Intellectual Capital Director CIS

2 Caterpillar is The world s largest manufacturer of construction and mining equipment, diesel and natural gas engines & industrial gas turbines The technology leader in construction, transportation, forestry, mining, energy, logistics & electric power generation Number 44 in the Fortune 500 list More than $67 billion in assets Turnover 2009 $32,4 billion Number one in stockholder returns for the Dow 30 Companies for the last 5 years CIS presence for 35+ years

3 CIS Dealer Geography 16 Dealers

4 How do we recruit employees? How to we train & develop employees? How to we keep our employees?

5 ATTRACT DEVELOP RETAIN

6 CIS Intellectual Capital Department Safety Dealership HR Organisational Development CIS HR Shared Services (Operational & Strategic) CIS Training & Development Shared Services Dealer Training & Development Building Services Graduate, Internship & Apprentice Programmes CIS IT Shared Services Reception & Auxiliary Staff

7 Cat CIS People Strategy HR ORGANISATIONAL EXCELLENCE RETAIN TALENT MANAGEMENT DEVELOP DEVELOPMENT & TRAINING PERFORMANCE EVALUATION ATTRACT TOTAL REWARDS JOB EVALUATION RECRUITMENT

8 ATTRACT Total Rewards & Job Evaluation Annual Market Salary Survey Employee Opinion Surveys Fixed + Variable + Fringe Benefits Adaptable Training & Career Development Culture Empowerment Culture Recruitment Professional Internal Recruitment Consultants Internal & External Recruitment Process = Objective Ownership Career Planning vs. Succession Planning Options Transparent Functional Growth Based on Objective Performance Evaluation

9 DEVELOP Career Planning Employee-led Process Focus on People Key aim: to identify the best possible career path for employees based potential Key drivers: employee motivation, flexibility, talent and opportunity Key tools: Talent Management System, Annual Appraisal System, Skill Gap Analysis & Competency Evaluations Succession Planning Corporate-led Process Focus on Functions Key aim: Manage the Caterpillar pipeline for position backfill Key drivers: function tenure, organizational change, job evaluation (hard and soft skills), skill-gap analysis with identified candidates Key tools: Appropriate use of the TMS and rigueur in the internal recruitment process

10 Vision Innovative Thinking Strategic Achievement Customer and Market Insight Develop: 12 Leadership Competencies at Caterpillar Vision Execute Legacy Execute Influencing Others Leading Change Building Organizational Capability Self-Confidence Enterprise Focus Legacy Developing Others Managing Performance Interpersonal Understanding Leveraging Differences

11

12 Develop: Dealership Development: University Relationship Management Caterpillar Training Center at the Admiral S.O. Makarov Maritime Academy, St.-Petersburg Caterpillar Engine Training Center at the State Maritime University Vladivostok

13 Develop: University Courses Proposed

14 Retain: Talent Management Career Management Employee Motivation Appraisal Process Internship, graduate and traineeship programmes Internal & External Recruitment TALENT MANAGEMENT Expatriate Selection Corporate Diversity Training & Development Succession Management Knowledge / Know- How Transfer & CRM Essentials

15 Retain: Talent Management Career Management Employee Motivation Appraisal Process Internship, graduate and traineeship programmes Internal & External Recruitment TALENT MANAGEMENT Expatriate Selection Corporate Diversity Training & Development Succession Management Knowledge / Know- How Transfer & CRM Essentials

16 Career Management 8+ Years of Cat / Industry Experience SG: 25 Salary Grade SG: 26 SG: 27 SG: 28 Black Belt Commercial Senior Field Assignment Senior Staff / Black Belt 2 nd Field Assignment Staff Assignment SG: 29 Industry Supervisor 1 st Field Assignment SG: 30 Industry Corporate Accounts Developmental Assignment SG: 31 Depart / Region District Marketing Marketing & Sales Department Marketing Support Business Intelligence Supervisor Black Belt Marketing Support Product Groups SG: 31 Product Regional Product NPI Supervisor SG: 30 SG: 29 SG: 28 Commercial Black Belt Product SG: 27 Service Center SG: 26 Base Skills & Competencies Leadership - Technical Cultural Diversity Commercial Marketing Dealer Operations 6Sigma - Application Segment Groups Product Support SG: 25 Power Systems Marketing Training Class - Transfer to Marketing - External Hire Staff & Field Support 75% Leadership 25%

17 Career Management 8+ Years of Cat / Industry Experience SG: 25 Salary Grade SG: 26 SG: 27 SG: 28 Black Belt Commercial Senior Field Assignment Senior Staff / Black Belt 2 nd Field Assignment Staff Assignment SG: 29 Industry Supervisor 1 st Field Assignment SG: 30 Industry Corporate Accounts Developmental Assignment SG: 31 Depart / Region District Marketing Department Marketing Support Business Intelligence Supervisor Black Belt Marketing Support Product Groups SG: 31 Product Regional Product NPI Supervisor SG: 30 SG: 29 SG: 28 Commercial Black Belt Product SG: 27 Service Center SG: 26 Base Skills & Competencies Leadership - Technical Cultural Diversity Commercial Marketing Dealer Operations 6Sigma - Application Marketing & Sales Segment Groups Product Support SG: 25 Power Systems Marketing Training Class - Transfer to Marketing - External Hire Staff & Field Support 75% Leadership 25%

18 Employee Motivation: One theory is that motivation is based on 4 relationships WHEN ALL 4 OF THESE RELATIONSHIPS ARE STRONG, EMPLOYEES TEND TO BE MOTIVATED AND WILL STAY IF ANY ONE, OR MORE OF THESE RELATIONSHIPS ARE WEAK, EMPLOYEE EFFORT IS LIKELY TO SUFFER

19 Employee Motivation: EFFORT : APPRAISAL APPRAISAL : REWARD REWARD : REQUEST SATISFACTION : PRODUCTIVITY

20 HR Organizational Excellence Is Essentially About Taking a Holistic View of People Management AND Removing the Obstacles To Employee Productivity

21 Thank you for your attention Caterpillar CIS LLC Howard H. Gibson

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