Building Better

Digging Deeper

2016 Annual Report

Whether paving roads, mining essential commodities or extracting the fuels to satisfy global energy demand, Caterpillar’s products are helping to build a better world.

And we’re doing the same for our business.

Though we operate in cyclical markets, we’re on a journey of continuous improvement in critical areas such as quality, safety and digital technology – working to build better and grow stronger every day. At Caterpillar, we’re building better every day.

Building a Better Caterpillar

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In 2016, we spent almost
$2 Billion
on R&D


We live in an age that demands smart iron. An era in which entire work sites are connected through a single network. Where data produced from machines, engines and entire fleets provide key analytics that save money, time and lives. That’s why we continue to expand and enhance our Cat® Connect Technology and Services. Through hardware, software, electronics and sensors, our technologies supply state-of-the-art information uniquely tailored to improve our customers’ operations. By combining technology with our services that bring information to life, our customers are gaining a competitive edge.


We’re four years into our Lean journey. That means four years of striving for zero defects at every stage of our processes, four years of safer work environments and more efficient production flows, and four years of improved execution in non-manufacturing areas such as engineering, purchasing, accounting and human resources. Lean is the disciplined execution Caterpillar needs to eliminate waste and drive efficiencies, and it is a never-ending journey. We’ll continue applying it to deliver a better, more competitive Caterpillar.


2016 variable
cost reduction

Building Quality

Caterpillar is committed to providing products and services that enable our customers to be more profitable using our products than those of our competition. We are committed to product quality and reliability. For our customers, this means confidence in availability, in avoiding unexpected downtime and in the longevity of the product. Customers can be confident that they can start a job, that the product will be working, and that its residual value will minimize total cost of ownership.

committed to
product quality
and reliability


Our safety improvement metrics continue to reach record levels. To us, that’s a solid indication of sound operational management — of trust between employees and leadership. Sound management also means we’re minimizing our environmental footprint. Over the past decade, we’ve made significant improvements in our energy use and output of emissions and waste. Others have taken note and in 2016, we were named to the Dow Jones Sustainability Indices (DJSI) for the
17th year.

reduced GHG emissions by
from 2015 to 2016
of electrical Energy from alternative / renewable sources in 2016
reduced Water Consumption Intensity by
from 2006 to 2016
less by-product materials from 2015 to 2016
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Top 25 Noteworthy Companies for Diversity DiversityINC, 2016

Building together

Our global and diverse workforce is at the very heart of Caterpillar’s success. We hold ourselves to high standards of values in the way we carry out our daily work, and we strive to foster an inclusive environment for ourselves and others. Our customer success is the result of a collaborative effort between the Caterpillar workforce and our global independent dealer network. Our dealer network is an important competitive differentiator. Through our Across the Table initiative, we’re raising the foundational capabilities of our entire dealer network, focusing on unmatched service excellence, an efficient and effective parts distribution network, and easy-to-use
eCommerce platforms.

Building Better

Digging Deeper

Explore stories from 2016 about our Technology, Customers and Impact in the world.