A Summary Of Andrew Carnegie And J. P. Morgan

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During the time of the American Industrial Revolution famous names like Andrew Carnegie and J.P. Morgan were investing their money in the Steel and Financial industry to strike it big and become even richer. Both Carnegie and Morgan, being the brilliant investors that they were, had two very similar, but different strategies to make the most money possible and rule their markets. While Morgan believed in horizontal integration, Carnegie invented a system that was much more interesting and complex, which would be appellated vertical integration. Morgans method of horizontal integration is defined as, “the acquisition of additional business activities that are at the same level of the value chain in similar” (Staff, April 2015). Morgan was buying all the smaller steel mills and railroad companies to allow him to rule the whole market, which worked, but had several downfalls. Even though Morgan owned a large amount of factories and percentage of the industry, it didn’t mean that he was going to make more money easier. Carnegie, on the other hand, used his method of vertical integration, which would allow him to ultimately defeat J.P. Morgan's threat on the market. Vertical integration is “a strategy where a company expands its business operations into different steps on the same production path, such as when a manufacturer owns its supplier and/or distributor” (Staff, December 2015). So, in Carnegie's instance, he was buying all the smaller companies that he orders

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