Overview of Caterpillar University:

Learning Organization Structure, Governance,

Strategic Learning, Metrics and Evaluation
Corporate University Exchange
CLO Exchange Forum

What have I learned today?

Dave Vance,
President
Caterpillar University
September 23, 2004
1

Outline
Background on Caterpillar
Origin, mission, structure of Caterpillar University
and learning community
Key Cat U initiatives
Enterprise Learning Plan and Division Learning Plan
Learning metrics and Evaluation
Looking ahead

What have I learned today?

Caterpillar Inc.
72,000 Caterpillar Employees
38,000 inside U.S.
34,000 outside U.S.

246 Caterpillar facilities around the

world
90,500 Dealer Employees
34,400 inside U.S.
56,100 outside U.S.

What have I learned today?

Machines Range From

216 Skid Steer Loader:
Manufactured in Sanford, NC
Operating Capacity: 1,400 lbs.

797 Mining Truck:

Manufactured in Decatur, IL

What have I learned today?

Operating capacity: 380-ton nominal

payload
4

Engines Range from

9 horsepower for small machines and
generators
To 600 horsepower for on-highway trucks,
transit buses, fire trucks
To 3000 horsepower for the large Caterpillar
equipment
To turbines with over 18,000
horsepower for oil, gas and
power generation industries

What have I learned today?

And More than Big Yellow Machines

Cat Logisticsone of the worlds largest
contract logistics providers, customers
include Harley Davidson, DaimlerChrysler,
Sprint, and Ford Motor Company
Cat Financialmanages a portfolio of $18
billion, serves nearly 80,000 customers
Cat Power Venturesdevelops, owns, and
operates power plants

What have I learned today?

The Origin of Caterpillar

University
1998
2000

2001

Marketing Distribution Team recommends that

Caterpillar must become a continual learning
organization to succeed
An eight-member Continual Learning Team makes
specific recommendations for continual learning
and creation of Caterpillar University
Cat University to focus on common learning needs,
culture, leadership, knowledge sharing
Transcend 25 autonomous business units
Funding model for ongoing operations not addressed

Economy slowing; recession begins in early 2001

What have I learned today?

Caterpillar University
Established January 2001
__________________
Enterprise Learning Vision
To be recognized as one of the best continual learning
organizations in the world.

__________________
Caterpillar University Mission

Improve the performance of Caterpillar employees, dealers,

suppliers and customers.

In a Shared Beliefs Environment

What have I learned today?

Global Product Manager

for Learning
Working
Workingacross
acrossthe
theenterprise
enterpriseto
toensure
ensurethe
the
investment
investmentin
inlearning
learning isislinked
linkedto
to Caterpillar's
Caterpillar's
strategy
strategyand
andprovides
providesmaximum
maximumvalue.
value.

Enterprise learning strategy

Development of new learning/redesign or
retirement of existing learning
Design control for learning
Enterprise learning budget
Enterprise metrics and measures
What have I learned today?

Learning at Caterpillar
Managing
Managingour
ourintellectual
intellectual
Knowledge Sharing
capital
capitaland
anddevelopment
development
E-learning
Leadership development (coaching, workshops,
facilitation)
Classroom training
Competencies
Career development
Change management
Systems support, such as Learning Management
System and Knowledge Network

What have I learned today?

10

Caterpillar University Governance

Board of Governors, which includes
the CEO and senior executives
- Approve learning budgets and priorities
- Determine policy

Advisory Board for each college,

which includes senior leaders from
user groups
- Members represent different business units

- Geographic and subject matter mix

What have I learned today?

11

Partnership in Developing
Strategic Learning
Lead Learning Managers, one from
each business unit
Dual solid line reporting to Cat U and Business Unit
Monthly teleconferences

Global Teams

Lead Learning Managers and Subject-Matter Experts

Serve as consultants on key initiatives

What have I learned today?

12

Role of the Cat U Managers

Meet common, global learning needs
Meet local and regional needs
Ensure customer satisfaction with
Cat U services
Enable learning partnership
Work with lead learning managers
Work with advisory boards

What have I learned today?

13

Corporate
Governance to
Ensure Alignment

Lead Learning Managers at Business

Units
Immediately established dual solid line
reporting relationship with a Lead Learning
Manager at each of 26 Business Units
Business
Unit
HR Mgr

Caterpillar
University
Manager

Learning Manager
What have I learned today?

14

How Cat U Delivers Learning

E-learning,
Knowledge Sharing,
Leadership development

Enterprise learning
programs for
classroom delivery

OR

Business Units

Learning Managers in
Business Units

What have I learned today?

15

VP Human Services Division

S. C. Banwart

University President
David L. Vance

Adm. Asst.
Mary Jenkins

Dean

Dean
Chris Arvin

Ruud Kronenburg

Leadership
General
Studies

Marketing &
Distribution
Product
Support

Manager
Performance Improvement
Fred Goh

What

Competencies
Career Development
Regional Center Coordination
Vendor Management
Master Scheduling
haveCommunication
I learned today?
Metrics

Dean
Ben Tien
Business
Business
Processes

Dean

Dean

Alice Barbour

Sheryl Tipton
Technology

6 Sigma

Manufacturing
Engineering
IT
Safety

Manager
Tech Enabled Lrng.
Jayne Henneberg
E-learning
Knowledge Sharing
CLMS
Performance Support/Usability

16

Key Strategic Initiatives

College of Leadership
Caterpillar leadership programs

Colleges of Business and Business

Processes
Performance management curriculum
Change management
Business Acumen

What have I learned today?

17

Key Strategic Initiatives

College of Marketing and Distribution
Sales effectiveness and certification program for dealers

College of Technology
Engineering curriculum and guides
Safety curriculum
Ergonomics e-learning
Assembly e-learning
IT curricula

What have I learned today?

18

Key Strategic Initiatives

College of 6 Sigma
Manage 6 Sigma training plan
Develop internal Cat MBBs
Train dealers and suppliers

Performance Improvement
Enterprise and Division Learning Plans
Career Development
Competencies
Learning processes

What have I learned today?

19

Key Strategic Initiatives

Technology-Enabled Learning
Caterpillar Learning Management System
E-Learning More 600 e-learning courses, 175 of which are
available in multiple languages
Knowledge Network
Performance Support and Usability

What have I learned today?

20

Division Learning Plan

Needs assessment initiated at the division level
Lead learning managers identified learning needs within
their respective divisions through discussions with Vice
Presidents and Directors/Managers
Learning needs linked to Division and Corporate Critical
Success Factors
Resource requirements identified to meet needs
Division business leaders consulted in setting priorities

Vice President approves their Division Learning

Plan which is the business plan for learning
that address both strategic and operational
learning.

What have I learned today?

21

Enterprise Learning Plan

Enterprise-wide learning strategy developed based on the

25 divisional learning plans and Senior Management/Board
of Governors input

15 high priority, global learning initiatives identified and

organized by Cat U college or area

Each learning initiative linked to one or more of Caterpillars

business CSFs

The Board of Governors reviewed and approved the

learning strategy and investment requirements

Included discussion of metrics and ROI

What have I learned today?

22

Tie Learning to Business Goals

What have I learned today?

23

Metrics
Enterprise Learning Plan translated into prioritized
goals with volume and level 1-3 targets
Progress against plan measured every month in vital
factor meeting
Year-end forecast updated monthly; focus on
deviations from plan.

What have I learned today?

24

Evaluation
Started in 2002 with need to show value proposition
for learning
162 page Business of Learning was our first effort
Nine detailed ROI studies conducted to date
Dollar benefits, costs, net benefits, ROI
Tried to improve in productivity, quality or reduction in cost

Three state approach to ROI

Estimate ROI at development, forecast after pilot, complete ROI at close
Learn, modify, improve

What have I learned today?

25

Monthly Metrics Review

Process
Owner

Current Year
Business Plan

Learning
Initiatives

YTD
Actuals

Caterpillar

ROI
Forecasts

Cumulative
Metric

Current Year-End Forecast

Caterpillar

THE JOURNEY

True Continual Learning Organization

PROFIT CONTRIBUTION FROM LEARNING

Very high level of knowledge creation and sharing, innovation,

creativity, engagement and risk-taking
Self-perpetuating learning culture
Spending on learning not reduced disproportionately in downturn
Learning embedded in all tactical and strategic plans
Extend learning to
entire value chain

Establish enterprise-wide learning strategies

Systems thinking, change management used
extensively throughout enterprise

2003-2004

Formally tie learning to business goals

Mistakes viewed as opportunities to learn
Begin to tie learning to business goals
Begin to develop metrics and ROIs
Identify and meet common global
learning needs with courses
6 Sigma initiated

Needs-assessments indicate
where learning is needed to
achieve business goals

Leaders champion learning

Commit to become a continual learning organization

Focus on knowledge sharing and e-learning

Focus on leadership

Provide existing training at lower cost

Cat U Established
2000Desire for continuous improvement and continual learning
Training Focus
Courses
Sharing

Caterpillar University 2002

Caterpillar Inc.

Learning viewed as
an indispensable
part of culture

TIME

2001-2002

Learning

Learning Focus
Caterpillar: Confidential Green

Keys to Our Success

Burning platform established by original study
team
Excellent foundation provided by the Continual
Learning Team
Partnership with our independent business units

Lead Learning manager concept

Dual-solid line reporting of business unit learning manager to Cat U

A great team of dedicated individuals committed to

transforming Caterpillar
Knowledgeable resources

Consultant for ROI

Upper management support

What have I learned today?

28

Keys to Our Success (contd.)

Journey chart to convey vision
Extensive use of volume metrics, Level 1
evaluations
Focus on strategic learning
Business of Learning
Enterprise Learning Plan

What have I learned today?

29

Lessons Learned
On-going funding model should have been
established up front
Business of Learning was an excellent
exercise
We learned a lot in writing it
The discipline, alone, was worth the effort
It established the basis for our ongoing metrics and
evaluation work
Established credibility with many
Excited the learning community and sponsors
But did not sway the die hard skeptics

What have I learned today?

30

Desired State
1. Right balance between strategic, operational
and personal learning
2. Greater appreciation for bottom line benefit of
learning
3. Metrics and evaluation embedded in all learning
4. Process owners who plan for and integrate
learning from the beginning and who can work
to ensure sustainability of improved
performance

What have I learned today?

31