Industry on the Move

1. Industry on the Move

2. Rapid Advances • 1870-1900 a BOOM in industrial growth • Coal, oil, electricity, steel and railroads • Inventions happening like wildfire • Bessemer process key • Process of making steel, quicker and more efficient • Started in England, had to have it in US

3. Research and Development • Explosion of inventive activity • Goal to harness this and control it • Invention factories established • Thomas Edison key in this movement • Organize system • Control R&D • Produce ideas in a efficient and profitable way

4. Communication and Transportation • Concept was key to success • Scrambling to better communicate and transport goods • Telegraph: 1844, by 1861 lines covered 76,000 miles • Soon outdone • Telephone: 1876 Alexander Graham Bell • Proved to be a great invention

5. Changes to Business Practices • The Corporation • Advantages of the corporation: raise large sums of money, outlive its owners, limited liability, separated owners from day-to-day management • By the turn of the century, corporations were making two-thirds of all manufactured products in the U.S. • An International Pool of Labor • Global labor network • Migration chains • Domestic sources

6. Cont….. • Hiccups in Railroad industry • Railroads saddled with enormous fixed costs: equipment, payroll, high debts • Pooling: informal agreements among competing companies to act together • The Challenge of Finance • New ways of raising money; stocks • Investment bankers advised companies about their business affairs

7. Strategies • Horizontal combination • Eliminate competition by buying others out • Vertical combination • Controlling all stages of production • Trusts • Way to get around state regulations, did not actually “own” business

8. Cost of Growth • Early on evidence of environmental concerns • Labor concerns arising • Unions on the rise • Big business in the hands of a few • People fearing the worst • Regulation limited