The Different Business Practices of Andrew Carnegie and John D. Rockefeller
Michael Callicutt
Dr. Claude Black
HY 273
15th November 2011
The Different Business Practices of Andrew Carnegie & John D. Rockefeller
Two of the most well-known and successful companies of the Industrial Revolution were the Standard Oil Company, and the Carnegie Steel Company. Both were exceedingly successful in virtually removing all competition in their respective fields of business and controlling almost all of the production capacity of their respective products in the United States. Their founders, John D. Rockefeller of the Standard Oil Co., and Andrew Carnegie of the Carnegie Steel Co. conducted business practices that were different from one another in how they dealt with competition as seen in the undercutting or cheap type buyout employed by Carnegie in comparison to the forced buyout by Rockefeller, how they consolidated wealth as seen where Carnegie horizontally integrated other steel mills to grow his wealth while Standard Oil later on in their history vertically integrated, how they managed public relations as seen where Carnegie attempted to suppressed any negative press while Rockefeller would balance it's negative publicity by showing his philanthropic side, and how they treated their workers as seen by how Carnegie disregarded collective bargaining and safety for efficiency while Rockefeller valued worker loyalty through good wages, treated them fairly, and commonly rewarded them with bonuses. The first immediate difference that is seen between the two men and their business practices is how they dealt with competition. Andrew Carnegie's company would force the other steel mills in the Pennsylvania area to be bought out due to the cheap prices of the Carnegie steel. The other, smaller competitors could not sell their steel for such as low price and still make a profit, and therefore had to allow Carnegie to buyout their mills. In opposite to Carnegie, Rockefeller would sometimes be known to hire thugs, or engage in compacts with other
Dr. Claude Black
HY 273
15th November 2011
The Different Business Practices of Andrew Carnegie & John D. Rockefeller
Two of the most well-known and successful companies of the Industrial Revolution were the Standard Oil Company, and the Carnegie Steel Company. Both were exceedingly successful in virtually removing all competition in their respective fields of business and controlling almost all of the production capacity of their respective products in the United States. Their founders, John D. Rockefeller of the Standard Oil Co., and Andrew Carnegie of the Carnegie Steel Co. conducted business practices that were different from one another in how they dealt with competition as seen in the undercutting or cheap type buyout employed by Carnegie in comparison to the forced buyout by Rockefeller, how they consolidated wealth as seen where Carnegie horizontally integrated other steel mills to grow his wealth while Standard Oil later on in their history vertically integrated, how they managed public relations as seen where Carnegie attempted to suppressed any negative press while Rockefeller would balance it's negative publicity by showing his philanthropic side, and how they treated their workers as seen by how Carnegie disregarded collective bargaining and safety for efficiency while Rockefeller valued worker loyalty through good wages, treated them fairly, and commonly rewarded them with bonuses. The first immediate difference that is seen between the two men and their business practices is how they dealt with competition. Andrew Carnegie's company would force the other steel mills in the Pennsylvania area to be bought out due to the cheap prices of the Carnegie steel. The other, smaller competitors could not sell their steel for such as low price and still make a profit, and therefore had to allow Carnegie to buyout their mills. In opposite to Carnegie, Rockefeller would sometimes be known to hire thugs, or engage in compacts with other
Cited: McGee, John S. "Predatory Price Cutting: The Standard Oil (N.J.) Case." Journal of Law and Economics. 1. (1958): n. page. Print. . Hotelling, Harold. "Stability in Competition." Economic Journey. 39. (1929): n. page. Print. . Chandler, Alfred D. "The Enduring Logic of Industrial Success." Harvard Business Review. 9. (1990): n. page. Print. . Carnegie, Andrew. The Gospel of Wealth and Other Timely Essays. Rev. ed. New York City: The Century Company, 1900. Print. Tarbell, Ida M., and David Mark. Chalmers. The History of the Standard Oil Company. Mineola, NY: Dover Publications, 2003. Print.