Autobiography of Andrew Carnegie
erected. Repeated additions to the Union Iron Mills had made them the
leading mills in the United States for all sorts of structural shapes.
Business was promising and all the surplus earnings I was making in
other fields were required to expand the iron business. I had become
interested, with my friends of the Pennsylvania Railroad Company, in
building some railways in the Western States, but gradually withdrew
from all such enterprises and made up my mind to go entirely contrary
to the adage not to put all one's eggs in one basket. I determined
that the proper policy was "to put all good eggs in one basket and
then watch that basket."
I believe the true road to preeminent success in any line is to make
yourself master in that line. I have no faith in the policy of
scattering one's resources, and in my experience I have rarely if ever
met a man who achieved preeminence in money-making--certainly never
one in manufacturing--who was interested in many concerns. The men who
have succeeded are men who have chosen one line and stuck to it. It is
surprising how few men appreciate the enormous dividends derivable
from investment in their own business. There is scarcely a
manufacturer in the world who has not in his works some machinery that
should be thrown out and replaced by improved appliances; or who does
not for the want of additional machinery or new methods lose more than
sufficient to pay the largest dividend obtainable by investment beyond
his own domain. And yet most business men whom I have known invest in
bank shares and in far-away enterprises, while the true gold mine lies
right in their own factories.
I have tried always to hold fast to this important fact. It has been
with me a cardinal doctrine that I could manage my own capital better
than any other person, much better than any board of directors. The
losses men encounter during a business life which seriously embarrass
them are rarely in their own business, but in enterprises of which the
investor is not master. My advice to young men would be not only to
concentrate their whole time and attention on the one business in life
in which they engage, but to put every dollar of their capital into
it. If there be any business that will not bear extension, the true
policy is to invest the surplus in first-class securities which will
yield a moderate but certain revenue if some other growing business
cannot be found. As for myself my decision was taken early. I would
concentrate upon the manufacture of iron and steel and be master in
that.
My visits to Britain gave me excellent opportunities to renew and make
acquaintance with those prominent in the iron and steel
business--Bessemer in the front, Sir Lothian Bell, Sir Bernard
Samuelson, Sir Windsor Richards, Edward Martin, Bingley, Evans, and
the whole host of captains in that industry. My election to the
council, and finally to the presidency of the British Iron and Steel
Institute soon followed, I being the first president who was not a
British subject. That honor was highly appreciated, although at first
declined, because I feared that I could not give sufficient time to
its duties, owing to my residence in America.
As we had been compelled to engage in the manufacture of wrought-iron
in order to make bridges and other structures, so now we thought it
desirable to manufacture our own pig iron. And this led to the
erection of the Lucy Furnace in the year 1870--a venture which would
have been postponed had we fully appreciated its magnitude. We heard
from time to time the ominous predictions made by our older brethren
in the manufacturing business with regard to the rapid growth and
extension of our young concern, but we were not deterred. We thought
we had sufficient capital and credit to justify the building of one
blast furnace.
The estimates made of its cost, however, did not cover more than half
the expenditure. It was an experiment with us. Mr. Kloman knew nothing
about blast-furnace operations. But even without exact knowledge no
serious blunder was made. The yield of the Lucy Furnace (named after
my bright sister-in-law) exceeded our most sanguine expectations and
the then unprecedented output of a hundred tons per day was made from
one blast furnace, for one week--an output that the world had never
heard of before. We held the record and many visitors came to marvel
at the marvel.
It was not, however, all smooth sailing with our iron business. Years
of panic came at intervals. We had passed safely through the fall in
values following the war, when iron from nine cents per pound dropped
to three. Many failures occurred and our financial manager had his
time fully occupied in providing funds to meet emergencies. Among many
wrecks our firm stood with credit unimpaired. But the manufacture of
pig iron gave us more anxiety than any other department of our
business so far. The greatest service rendered us in this branch of
manufacturing was by Mr. Whitwell, of the celebrated Whitwell Brothers
of England, whose blast-furnace stoves were so generally used. Mr.
Whitwell was one of the best-known of the visitors who came to marvel
at the Lucy Furnace, and I laid the difficulty we then were
experiencing before him. He said immediately:
"That comes from the angle of the bell being wrong."
He explained how it should be changed. Our Mr. Kloman was slow to
believe this, but I urged that a small glass-model furnace and two
bells be made, one as the Lucy was and the other as Mr. Whitwell
advised it should be. This was done, and upon my next visit
experiments were made with each, the result being just as Mr. Whitwell
had foretold. Our bell distributed the large pieces to the sides of
the furnace, leaving the center a dense mass through which the blast
could only partially penetrate. The Whitwell bell threw the pieces to
the center leaving the circumference dense. This made all the
difference in the world. The Lucy's troubles were over.
What a kind, big, broad man was Mr. Whitwell, with no narrow jealousy,
no withholding his knowledge! We had in some departments learned new
things and were able to be of service to his firm in return. At all
events, after that everything we had was open to the Whitwells.
[To-day, as I write, I rejoice that one of the two still is with us
and that our friendship is still warm. He was my predecessor in the
presidency of the British Iron and Steel Institute.]
CHAPTER XIII
THE AGE OF STEEL
Looking back to-day it seems incredible that only forty years ago
(1870) chemistry in the United States was an almost unknown agent in
connection with the manufacture of pig iron. It was the agency, above
all others, most needful in the manufacture of iron and steel. The
blast-furnace manager of that day was usually a rude bully, generally
a foreigner, who in addition to his other acquirements was able to
knock down a man now and then as a lesson to the other unruly spirits
under him. He was supposed to diagnose the condition of the furnace by
instinct, to possess some almost supernatural power of divination,
like his congener in the country districts who was reputed to be able
to locate an oil well or water supply by means of a hazel rod. He was
a veritable quack doctor who applied whatever remedies occurred to him
for the troubles of his patient.
The Lucy Furnace was out of one trouble and into another, owing to the
great variety of ores, limestone, and coke which were then supplied
with little or no regard to their component parts. This state of
affairs became intolerable to us. We finally decided to dispense with
the rule-of-thumb-and-intuition manager, and to place a young man in
charge of the furnace. We had a young shipping clerk, Henry M. Curry,
who had distinguished himself, and it was resolved to make him
manager.
Mr. Phipps had the Lucy Furnace under his special charge. His daily
visits to it saved us from failure there. Not that the furnace was not
doing as well as other furnaces in the West as to money-making, but
being so much larger than other furnaces its variations entailed much
more serious results. I am afraid my partner had something to answer
for in his Sunday morning visits to the Lucy Furnace when his good
father and sister left the house for more devotional duties. But even
if he had gone with them his real earnest prayer could not but have
had reference at times to the precarious condition of the Lucy Furnace
then absorbing his thoughts.
The next step taken was to find a chemist as Mr. Curry's assistant and
guide. We found the man in a learned German, Dr. Fricke, and great
secrets did the doctor open up to us. Iron stone from mines that had a
high reputation was now found to contain ten, fifteen, and even twenty
per cent less iron than it had been credited with. Mines that hitherto
had a poor reputation we found to be now yielding superior ore. The
good was bad and the bad was good, and everything was topsy-turvy.
Nine tenths of all the uncertainties of pig-iron making were dispelled
under the burning sun of chemical knowledge.
At a most critical period when it was necessary for the credit of the
firm that the blast furnace should make its best product, it had been
stopped because an exceedingly rich and pure ore had been substituted
for an inferior ore--an ore which did not yield more than two thirds
of the quantity of iron of the other. The furnace had met with
disaster because too much lime had been used to flux this
exceptionally pure ironstone. The very superiority of the materials
had involved us in serious losses.
What fools we had been! But then there was this consolation: we were
not as great fools as our competitors. It was years after we had taken
chemistry to guide us that it was said by the proprietors of some
other furnaces that they could not afford to employ a chemist. Had
they known the truth then, they would have known that they could not
afford to be without one. Looking back it seems pardonable to record
that we were the first to employ a chemist at blast
furnaces--something our competitors pronounced extravagant.
The Lucy Furnace became the most profitable branch of our business,
because we had almost the entire monopoly of scientific management.
Having discovered the secret, it was not long (1872) before we decided
to erect an additional furnace. This was done with great economy as
compared with our first experiment. The mines which had no reputation
and the products of which many firms would not permit to be used in
their blast furnaces found a purchaser in us. Those mines which were
able to obtain an enormous price for their products, owing to a
reputation for quality, we quietly ignored. A curious illustration of
this was the celebrated Pilot Knob mine in Missouri. Its product was,
so to speak, under a cloud. A small portion of it only could be used,
it was said, without obstructing the furnace. Chemistry told us that
it was low in phosphorus, but very high in silicon. There was no
better ore and scarcely any as rich, if it were properly fluxed. We
therefore bought heavily of this and received the thanks of the
proprietors for rendering their property valuable.
It is hardly believable that for several years we were able to dispose
of the highly phosphoric cinder from the puddling furnaces at a higher
price than we had to pay for the pure cinder from the heating furnaces
of our competitors--a cinder which was richer in iron than the puddled
cinder and much freer from phosphorus. Upon some occasion a blast
furnace had attempted to smelt the flue cinder, and from its greater
purity the furnace did not work well with a mixture intended for an
impurer article; hence for years it was thrown over the banks of the
river at Pittsburgh by our competitors as worthless. In some cases we