Youth
Born 25 November 1835 in Dunfermline, Scotland. His father, William Carnegie was a master handloom weaver like his father and grandfather before him. He was a weaver who made fine damask linen with elaborate designs. {Aside damask linen means a linen fabric with a woven design. Linen thread comes from the fiber of the Flax plant.} By 1835 the invention of the Cotton Gin in 1793 which made cotton cheap and a readily available alternative to both linen and wool — and the development of power looms meant that the days of the master handloom weaver were numbered. Carnegie s mother, Margaret, was frugal, neat, hard-working, with a strong and determined personality. Emotionally, she was a stronger person than her husband, William.
Andrew Carnegie did not go to school until the age of 8. Indulged by his parents, they had foolishly told him that he did not have to go to school until he decided to do so. At age 8 the local schoolmaster persuaded Andrew that schooling was a good thing. By the time the Carnegie family emigrated to America in 1848 Andrew had had only 5 years of formal education (and this in a classroom with up to 180 children in it!).
He could read, write, perform basic arithmetic, and knew a little Latin and a few poems.
By Andrew s birth in 1835 there were already over 100,000 power looms in the British cotton textile industry and the technology was rapidly spreading to the other textiles. The amount of work done by the hand weavers slowly declined until nearly all were out of work by the mid 1840s. Carnegie s family had to move to a smaller house and his Mother began running a little shop in the house where she sold food and sewed shoes on consignment in the evenings. Finally, in 1847 a large steam power weaving factory opened in Dunfermline ending for good the handloom weaving business. This, coupled with the potato blight, only worsened conditions in Scotland.
The Term Paper on Power Factor Correction
It gives us an immense pleasure to write an acknowledgement to this project report, a contribution of all people who helped us realize it. We take this opportunity to express our respectful regards to our beloved principal Dr. N. C. Hiremath for permitting us to do this project. We express our deep sense of gratitude and appreciation to our beloved HOD Prof. S. B. Patil for this enthusiastic ...
Margaret Carnegie decided during the winter of 1847 that the family must migrate to America. Two of her sisters had migrated to Pennsylvania in 1840 and, after writing discouraging letters for several years, began encouraging the Carnegie family to migrate. They sold all their possessions (the loom at a considerable loss as it was no longer valuable) and with a loan from a friend of Margaret s, sailed for New York City from Glasgow on 17 May 1848. From New York City, the Carnegie family went by boat up the Hudson river to the Erie Canal, traveled up the canal to Buffalo, by lake steamer to Cleveland, down the Ohio canal to the Ohio River, down the Ohio River to Beaver, PA, and finally by steamboat from Beaver to Pittsburgh. They settled in Allegheny, PA (now part of Pittsburgh s “north side”).
Early Business Career: 1848-1852
At the age of 13 Carnegie went to work as a bobbin boy in a local textile mill owned by a fellow Scot. He made $1.20 a week. Shortly thereafter he got a better paying job in a bobbin factory of yet another expatriate Scot. His job was dipping the bobbins into an oil bath and firing the factory boiler. He also got to work in the Company office on occasion where he decided he needed to learn double-entry bookkeeping. Consequently, in addition to working 12 hour days, he went to night school across the river in Pittsburgh.
Carnegie s big break came in 1849 when he got a job at the O Reilly telegraph company as a messenger boy (his Uncle knew the owner, yet another expatriate Scot).
{Aside Carnegie s experience was fairly typical. The more daring emigrated to America first. They would send letters home recounting their experiences. The more timid would then emigrate and rely upon the informal networks of fellow countrymen Scots, Irish, German, etc. for help in finding housing and work. The consequence was ethnic concentration especially in the eastern cities.} Carnegie delivered messages to all the important businesses in the city and soon knew a great deal about Pittsburgh s commercial affairs. He also came to appreciate the importance of the telegraph to the new economy that was then emerging. He worked long hours and learned telegraphy on his own time. In 1851 he became a full time telegraph operator and picked up the talent of being able to read a message in his head. {Aside The early telegraph used the opening and closing of “relays” to send the Morse Code all you heard were these “clacks” the spacing of which determined whether it was a dot or dash.}
The Essay on Andrew Carnegie Steel Company Pittsburgh
... over Mr. Scott's position as Superintendent of the Pittsburgh division of the Pennsylvania Railroad. After spending 12 years with the railroad company Carnegie invested in ... Finally, realizing that the future of Pittsburgh may rely on steel, Carnegie left the railroad company and built the J. Edgar ... took a job as a messenger boy for a telegraph service. While in this job, he taught himself telegraphy ...
The Pennsylvania Railroad: 1852-1865
Carnegie s big break in life came at the age of 17 when Tom Scott of the Pennsylvania Railroad hired him. Carnegie had come to Scott s attention because of his reputation as being the best telegraph operator in town and Scott needed a personal telegrapher and secretary.
Thomas A. Scott (1823 – 1881)
Scott had just been placed in charge of the Pittsburgh division of the Pennsylvania Railroad. The Pennsylvania, arguably the best managed railroad in the country (“the standard railroad of the world”), was at that time applying telegraph control pioneered by Daniel McCallum of the Erie to the movement of trains. (This was particularly important for the Pennsylvania given that it was a mountain railroad and had to run numerous smaller trains.) Carnegie soon became Scott s right hand man and was awarded with greater and greater responsibilities. One day he even issued orders using Scott s name to get traffic on the railroad moving again after a derailment. In 1855 while on a 10 day trip Scott even left the 20 year old Carnegie in charge of the Division.
Pittsburgh Division Pennsylvania Railroad
Carnegie happened to come onto the scene just as J. Edgar Thomson was perfecting a cost accounting system for the railroad based on highly detailed statistics. Implementing this system was Scott s job who was promoted to General Superintendent in 1855. Scott took Carnegie to the Altoona headquarters where Carnegie helped Scott perfect the system.
The Essay on The Southern Pacific Railroad sprr Was A Company With Many
The Southern Pacific Railroad (SPRR) was a company with many far-flung field offices. Rather than relying on the Bell System to provide communication between offices, they ran their own communications cabling along their right-of-way (trackside)creating their own internal nationwide communications network. Recently however, they have explored sending information via emails. This required them to ...
John Edgar Thomson (1808 – 1874)
In 1859 Carnegie was appointed Superintendent of the Pittsburgh Division at the age of 24! This was the most important and difficult Division of the railroad and Carnegie did an outstanding job. Indeed, Carnegie was so good that if he had chosen to make a career of it he would have been an important Railroad President in his own right. Carnegie showed his abilities by perfecting the system of statistical control even further and introducing management innovations. He ordered the telegraph stations be kept open 24 hours a day and appointed night time dispatchers thereby greatly increasing the efficiency of 24 hour movements of traffic. To clear away wrecks more quickly he ordered the cars blocking the track to be burned and he even had temporary tracks laid around wrecks to put the railroad back in service more quickly.
At the beginning of the Civil War in 1861 he helped Scott open the railways into the Capital. He also helped organize the Telegraphers Corps for the Union Army.
Summary: Some of the qualities that were to mark his later career had emerged by 1865.
1) Hard working (at least when he was young this would change by the 1870s)
2) ability to master the details of a business very quickly
3) daring and forceful not afraid to make decisions and follow through.
Financier: 1863-1872
In 1856 Scott persuaded Carnegie to buy some stock and even loaned him the money to do so. Carnegie bought the stock primarily because he admired Scott and regarded him as a father figure. The experience of receiving dividends changed Carnegie s attitude and he became an enthusiastic investor.
Carnegie s investments were primarily with Scott and Thomson and were in firms that did business with the Pennsylvania railroad. At this time business practices which today would be unethical and illegal were quite common. In particular, they often invested in firms that they could then contract with in their roles as managers of the Pennsylvania railroad to do business with the railroad. For example, they invested in a sleeping car company and then contracted with the company to run its sleeping cars over Pennsylvania track. Often these investments required little up-front cash because the subscription could be paid off by the dividends.
The Term Paper on Andrew Carnegie Iron Steel Business
... in 1865. In 1862 Carnegie joined a number of Pennsylvania Railroad managers to start the Keystone Bridge Company. Carnegie had been convinced that ... good his iron ore was and how to improve the charge in the furnace. Steel Business: In 1872, Andrew Carnegie was ... own blast furnace to guarantee supplies of pig iron that he controlled... The furnace went into blast in 1872 and Carnegie was determined ...
In 1861 Carnegie and William Coleman a wealthy Pittsburgh iron maker founded the Columbia Oil Company to get in on the oil drilling boom in the Oil Regions north of Pittsburgh. They made a substantial amount of money but Carnegie grew tired of the messy and chaotic state of the oil business and sold out in 1865.
In 1862 Carnegie, Scott, and Thomson and a number of other Pennyslvania Railroad managers started the Keystone Bridge Company. Carnegie had been convinced that the trend in railroading was towards heavier locomotives and cars and longer trains in order to increase productivity (this is also why he got into steel railroad rail manufacturing a few years later).
Consequently, the wooden bridges used by railroads, in addition to being a fire hazard, would eventually have to be replaced by sturdier, iron and steel bridges. Not surprisingly, the Pennsylvania Railroad could be counted upon to turn to the Keystone bridge company for its iron bridges.
Carnegie quit the Pennsylvania Railroad in 1865 both to concentrate on the bridge business which he was confident would boom after the War (the transcontinentals and rebuilding the railroads in the South) and to pursue investments. Keystone landed several major contracts to build bridges across the Mississippi and Missouri Rivers. Typically, major bridges were built by independent companies that floated stock to pay for the construction and then the bridge itself would be leased to a railroad. In addition, sometimes the bridge company contracted with a separate construction company to actually build the bridge. This opened even more avenues for profitability in securities transactions as the construction company usually was paid in stock at an inflated rate. This paved the way for multiple commissions for Carnegie in his role as securities salesman.
In 1867 Carnegie moved from Pittsburgh to New York City and began travelling regularly to Europe to sell bonds. By 1869 Carnegie and his perennial partners Scott and Thomson had made small fortunes by starting up their own telegraph company (which conveniently used the PARR right-of-way and had contracts with the PARR) which Carnegie was later able to quietly sell at a big profit. The trio also made an alliance with Pullman to provide the Union Pacific Railroad with sleeping cars. In 1871 the same group arranged a $600,000 loan to the Union Pacific in exchange for UP stock. The stock promptly rose because investors thought Thomson who ran “the standard railroad of the world” would take over the UP management. Instead, Carnegie began selling their “cheap” UP stock at a substantial profit.
The Term Paper on Golden Gate Bridge 2
The Golden Gate Bridge is a well-recognized landmark in the United States. This report provides you numerous information about one of the most astonishing suspension bridges in the world, it as well enlighten you with the history, design and the way that they have managed how to maintain the safety while construction was going on. The idea of a bridge linking the city with its neighbouring ...
In 1869 Carnegie met Junius Morgan (J. P. Morgan s father) in London. Junius Morgan was one of the leading investment bankers in London and his word “was as good as gold”. If Morgan endorsed a bond issue, it would be easily placed. Carnegie made substantial fees (typically 2.5%) selling bonds in Europe. He placed issues for various bridge construction projects and several railroads. By 1872 he was a rich man.
Iron: 1861 – 1872
Carnegie had gone into the iron business as early as 1861 when he and Thomas Miller had made an investment in a local iron company. Carnegie and Miller and two other partners later founded the Cyclops Iron Works in Pittsburgh in October of 1864. This firm was later merged with another firm in 1865 to form the Union Iron Works. After buying Miller out (at Miller s request), Carnegie s partners were his brother Tom, Henry Phipps, and Andrew and Anthony Kloman.
Henry Phipps (1839 – 1930)
Carnegie s aim was to ensure his Keystone Bridge Company a reliable and cheap supply of iron beams and plates — in short, vertical integration. This was something new in the iron business. Before Carnegie the business was highly specialized one mill produced the pig iron; another converted the pig iron to bars and slabs; other mills then rolled railroad iron, manufactured plates, nails, and so on. Transferring the iron from one establishment to another significantly slowed down the production of finished goods and added to the costs because of all the middlemen. His training on the Pennsylvania railroad was crucial. With the high fixed costs of railroading, to make money it was essential to: 1) have a good cost accounting system; and 2) once the costs were known, speed the flow of traffic through the system and increase its volume. His great innovation was applying these principles to the iron and steel business.
The Term Paper on Hard Times The Theme Of The Utilitarianism
H2>Historical Background The late 18th and early 19th centuries were an era of great change in Europe. The Industrial revolution happened in many countries, but was initially focused on Britain. The Industrial Revolution centered on the production of iron and the steam engine. Later, railways and increasingly mechanized forms of manufacturing would develop. The urban population increased ...
After some initial resistance, Carnegie was able to impose a rigorous cost accounting system which including installing weighing scales at all points in the mills to see where material was saved or not saved, and every man in a particular job was compared with all other men in that job. Cost accounting was the most important factor thereafter in personnel, marketing, and investment decisions.
In terms of speeding up the flow and increasing the volume, combining the production of iron beams and plates with the bridge company, he drastically cut the time and labor required to move material from operation to operation.
When Carnegie felt that he had successfully blended the two businesses he moved to expand further. In 1870 he built his own blast furnace (called the “Lucy” after Tom Carnegie s wife) to guarantee supplies of pig iron that he controlled. The furnace went into blast in 1872 and Carnegie was determined to increase its efficiency. He was amazed when he first went into the iron business that the owners of blast furnaces knew very little about what went on inside the furnace. It was literally a “seat-of-the pants” “rule-of-thumb” operation.
Now that he owned his own blast furnace Carnegie hired a German chemist to find out what was going on within the furnace. His chemist was able to tell him how good his iron ore was and how to improve the charge in the furnace. Andrew Kloman figured out a way to remove the slag from the furnace more rapidly thereby increasing the output. With the cost accounting system, Carnegie and his associates soon realized that they could hard drive the furnace. Hard Driving (increasing the flow of hot air through the bottom of the furnace at high pressure) wore out the furnace lining very rapidly, but the increased output more than justified the relining costs and the reduced life of the furnace. Indeed, Peter Berck (“Hard Driving and Efficiency: Iron Production in 1890”) shows that in 1890 “the pure profits of a hard-driven furnace would be enough to pay for the furnace in two years!” An American style hard driven furnace had to be relined every 3 years as opposed to 12 years for a British style furnace. Even with the cheaper capital available in Britain, the increased output of an American style hard driven furnace produced capital savings if output exceeded the (low) figure of 45,000 tons a year. Carnegie s men eventually got the Lucy to produce 100,000 tons a year!