The Standard Oil Company founded by John D. Rockefeller and the U.S. Steel
Company founded by Andrew Carnegie. The Standard Oil Company and U.S. Steel
Company were made successful in different ways due to the actions of their
different owners. The companies differed in their labor relations, market
control, and structural organization.
In the steel industry, Carnegie developed a system known as vertical integration.
This means that he cut out the middle man. Carnegie bought his own iron and
coal mines because using independent companies cost too much and were
inefficient. By doing this he was able to undersell his competetors because
they had to pay the competitors they went through to get the raw materials.
Unlike Andrew Carnegie, John D. Rockefeller integrated his oil business from
top to bottom, his distinctive innovation in movement of American industry was
horizontal. This meant he followed one product through all its stages. For
example, rockrfeller controlled the oil when it was drilled, through the
refining stage, and he maintained control over the refining process turning it
into gasoline. Although these two powerful men used two different methods of
management their businesses were still very successful (Conlin, 425-426).
Tycoons like Andrew Carnegie, "the steel king," and John D. Rockefeller, "the
oil baron," exercised their genius in devising ways to circument competition.
Although, Carnegie inclined to be tough-fisted in business, he was not a
monopolist and disliked monopolistic trusts. John D. Rockefeller came to
dominate the oil industry. With one upward stride after another he organized
the Standard Oil Company, which was the nucleus of the great trust that was
formed. Rockefeller showed little mercy. He believed primitive savagery
prevailed in the jungle world of business, where only the fittest survived. He
persued the policy of "ruin or rule."... [continues]
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(1999, 10). Corporate Development During the Industrial Revolution. StudyMode.com. Retrieved 10, 1999, from http://www.studymode.com/essays/Corporate-Development-During-Industrial-Revolution-1130.html
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