Rockefeller

When John D. Rockefeller was a young boy, he said that his two greatest ambitions were to make
$100,000 and to live to be 100 years old. He died on May 23, 1937, just 26 months shy of his 100th
birthday and with a net worth of $1.4 billion.

Over a forty-year career that was mired in controversy, Rockefeller made a name for himself in
America’s budding oil industry. He built Standard Oil into the largest company in the world and
eventually also became the richest man in the world. Adjusting for inflation, some experts suggest that
Rockefeller was the richest human being ever to have lived.

Born November 13, 1810 in Richford, New York, John Davison Rockefeller was the second of six
children to parents William and Eliza. William was a traveling salesman in the business of selling such
suspect things as cancer cures. While he was away, it was left to Eliza to take care of the home. The
family moved around, first to Moravia and later, Owego, where Rockefeller attended Owego
Academy.

In 1853, the family moved to Strongsville, Ohio, where Rockefeller went to Central High School. At
19, he became a deacon at the Euclid Avenue Baptist Church and a trustee at 21. In 1855, Rockefeller
dropped out of high school to take a business course at Folsom Mercantile College. A six-month
course, Rockefeller had completed it in just three.

After searching for six weeks, Rockefeller found his first job as an apprentice bookkeeper at Hewitt &
Tuttle, a commission merchant and produce shipping company. He started off earning 50 cents per day,
a salary that would gradually increase over the next two years due to his increasing responsibilities and
improving performance. In 1859, Rockefeller felt that he was no longer making the amount of money
he deserved and so he left Hewitt & Tuttle. With a partner, Maurice Clark, Rockefeller decided to
create his own produce commission company.

That year, Cleveland-based Clark & Rockefeller was launched and it became an instant success. It
wasn’t long before their new company had accumulated enough capital to be able to invest in other
businesses. Along with chemist Samuel Andrews, Clark & Rockefeller invested in an oil refinery.
Rockefeller was confident in the bright future of the oil business and over the next five years delved
wholeheartedly into making his company a success.

So confident was Rockefeller in the oil business that in 1865, he decided to sell his share of Clark &
Rockefeller to his partner. Far from giving up, Rockefeller wanted to branch out on his own. He used
the proceeds from the sale of his shares to invest in another refinery, which soon became Rockefeller &
Andrews. Two years later, they bought out the refinery that had been started by Rockefeller’s brother,
William. They also joined with Henry Flagler in creating Rockefeller, Andrews & Flagler.

By 1868, this new partnership had become the largest petroleum refiner in the world. Recognizing their
potential, the Rockefeller brothers, Andrews, Flagler and another silent partner began absorbing their
competition. Together, in 1870, the five businessmen launched Standard Oil. With Rockefeller as its
new president, the company would soon find itself at the forefront of a booming industry, achieving
unprecedented success.
By the time Standard Oil was in business, Cleveland had become one of the five major refining centres
in the country. By getting secret rebates from the railroads and supporting a new cartel aimed at
stabilizing freight railroad rates in return for preferential treatment, Rockefeller was able to give his
company an edge.

Rockefeller also began a campaign to buy out as many as possible of his competing refiners. In just six
weeks in 1872, Rockefeller had overtaken 22 of his 26 competitors in Cleveland. Standard Oil was
becoming so large that even the most ardent of competitors had little choice but to capitulate. If a
competitor refused his offer, Rockefeller promised to run them into bankruptcy.

By buying out his competition, improving his company’s own efficiency, and continuing to fight for
discounts from the railroads, Rockefeller was able to grow Standard Oil into one of the most powerful
corporations in the country. In little time, the company had become one of the largest shippers of oil
and kerosene in the U.S.

From Cleveland to the rest of the country, Standard Oil had attained a complete monopoly over oil
production in less than ten years. In order to consolidate his cross-country holdings, Rockefeller created
the Standard Oil Trust in 1882. It was at this point that Rockefeller began attracting much attention.
The Trust’s immense size was worrying for many observers.

Under Rockefeller, the price of kerosene dropped almost 80%, making it more widely available. But,
the Trust’s strong monopoly was a cause for concern amongst journalists, activists, and politicians
alike. Rockefeller himself became the target for much public criticism. In 1892, anti-trust laws in Ohio
even forced the separation of Standard Oil of Ohio from the rest of the company.

From 1896 to 1911, Rockefeller’s involvement in the company he had created gradually decreased.
While he maintained his presidential title as well as his stock, he disengaged himself in the daily
running of the company and its policy decisions. It was in 1911 that the company was dealt a huge
blow. While not as powerful as it was at its peak, Standard Oil by that point still controlled 64% of the
market. The U.S. Supreme Court then decided that because the company had originated from illegal
monopolistic practices, it had to be dismantled in 34 smaller companies. The remnants of these new
companies can still be found today in the likes of Chevron, Exxon, and Mobil.

Throughout his career, Rockefeller was also committed to certain charitable causes that were close to
his heart. He gave 10% of every paycheck to his church. As his wealth grew, he increased his giving to
educational and health causes, including $80 million to the University of Chicago, and creating
Rockefeller University and the Rockefeller Foundation. In total, Rockefeller gave away over $550
million of his $1.4 billion fortune.

Rockefeller’s legacy lives on today. No other American – including Bill Gates – has ever achieved a
similar level of wealth as a percentage of the nation’s economy.

“The secret of success is to do the common things uncommonly well,” said Rockefeller. “According as
you put something in, the greater will be your dividends of salvation.”

What perhaps most set Rockefeller apart from his competitors was his precision. Whereas others might
have left things to chance, Rockefeller believed that nothing was out of his control. No aspect of
Standard Oil’s operations was guessed at nor was anything left uncounted or unmeasured. Down to the
smallest detail, Rockefeller was obsessed with efficiency and economy. The precision and foresight
with which he worked would become two of the cornerstones of his success.

In order to ensure that Standard Oil was acting at the most efficient level possible, Rockefeller took
control over every aspect of its operations. He built refineries of higher quality and better planning than
did his competitors, using only the best materials available. He owned his own barrel-making plant as
well as drying facilities and hoop iron, which resulted in the reduced cost of a barrel by over $1.50. He
also ensured that Standard Oil produced its own sulfuric acid for the purification process and created
technology to recover it for re-use.

“I believe that thrift is essential to well-ordered living,” said Rockefeller. Wherever possible,
Rockefeller made sure that the company had complete control over its operations in order to reduce
costs. Standard Oil owned its own warehouses in New York City, its own boats on the Hudson and East
Rivers, its own fleet of tank cars, and its own cart transportation service. They also built their own
holding tanks near their refineries in order to efficiently store the oil and their equipment.

Whereas other refiners often dumped the waste products from their operations into rivers, Rockefeller
was insistent on trying to reuse them for his operations. He began creating from the waste a lubricating
oil that soon became the industry standard for lubricating machinery, replacing lard oil. He
manufactured Benzine as a cleaning fluid, paraffin for candles, and Petrolatum for ointments (white
petrolatum would later be marketed as Vaseline). He created Naphtha as a fuel for motors and shipped
it to other gas plants and also began using gasoline as a fuel.

Rockefeller knew that the oil business was at times chaotic, but he did his best to ensure that he
managed whatever he could. “Competition is a sin,” he said. In an industry with such low entry costs,
Rockefeller saw the market as being filled with a high level of waste. He viewed free competition as
inefficient and thus sought to buy out weaker firms. While his attempt to create a monopoly was
questioned by many, Rockefeller saw it as simply another step in his quest for efficiency.

Standard Oil grew to the scale that it did not by chance, but by Rockefeller’s design. It was the result of
a carefully formulated plan focused on efficiency and precision. By taking control over every aspect of
the company’s operations, and trying to reduce wasteful practices in not only his own company but
industry-wide, Rockefeller ensured his company would be an industry leader.

“If you want to succeed you should strike out on new paths, rather than travel the worn paths of
accepted success,” said Rockefeller.

Before Rockefeller entered the oil industry, he saw it as a vulgar environment. Oil workers were
typically rowdy and uncouth and the atmosphere was filled with prostitution, gambling and alcohol.
With low technological methods for refining and transporting oil, he also had difficulty seeing the
industry’s profitable possibilities.

Rockefeller knew that the industry was one of instability. Fires were regular occurrences that would
cause the prices of oil per barrel to sharply rise. Conversely, when new reserves of oil were discovered,
prices would fall dramatically. For a man who prized order and control, the oil industry was the last
place Rockefeller had planned on making his fortune.

But, rather than shy away from the difficulties that the industry posed, Rockefeller embraced them as
challenges. He was determined to set the industry straight, convinced that he could make a profit doing
things his own way. Thus, with determination and resolve, Rockefeller set out to not only reform the
industry but also to control it. It was with this intention that Rockefeller decided to create Standard Oil
in the first place. He needed an entity which could generate enough capital to begin acquiring his
competitors.

When Rockefeller first established Standard Oil, he also wanted to give it a different structure than
most other corporations of the day. Instead of giving his staff a regular salary, Rockefeller took the
unprecedented step of granting stock to his officers. He believed that giving his workers a stake in the
company would encourage hard work and make them prize the success of the company over individual
bonuses.

Instead of purchasing barrels from someone else, Rockefeller decided to make his own at a cheaper
cost. In doing so, Rockefeller noticed that 40 soldered rivets were being used to hold the wood
together. He proceeded to ask the welder why 40 were being used. The welder replied that this was
how he was trained. Rockefeller told the welder to try using just 38 rivets. When these new barrels
burst upon being filled, Rockefeller suggested trying 39 rivets. That time, the barrels managed to
sustain the oil. Not only did using one less rivet in his barrels save Rockefeller a small fortune over the
years, but it also demonstrates his willingness to take chances and try the road less traveled.

“Don't be afraid to give up the good to go for the great,” said Rockefeller. For Rockefeller, running his
business in the most efficient and profitable manner was more important than maintaining the status
quo. It was of no concern to him how his competitors were doing things, unless he could improve upon
them. From his equipment and technology to his secret deals with the railroads, Rockefeller wasn’t
afraid to strike out on his own path. Indeed, this was what set him apart from his competitors and why
he rose to the top when others were struggling to stay afloat.

“The road to happiness lies in two simple principles,” said Rockefeller. “Find what interests you and
that you can do well, and put your whole soul into it – every bit of energy and ambition and natural
ability you have.”

It was no accident that Rockefeller became one of the richest individuals in the history of the world.
While his initial stated goal was simply to live to be 100 years old and earn $100,000, Rockefeller had
the ambition to achieve much, much more. “I had no ambition to make a fortune,” he said. “Mere
moneymaking has never been my goal. “I had an ambition to build.”

Rockefeller began as a humble bookkeeper in Cleveland, Ohio. In less than seven years, he had risen to
control one tenth of the entire U.S. oil business. He was all business and rarely let personal feelings get
in the way of his business ambitions. In fact, Rockefeller’s favourite personal maxim was, “Don't let
good fellowship get the least hold of you.”

For Rockefeller, no detail was too small to neglect. In a similar vein, no task was too big to undertake.
In the late 19th century, Rockefeller faced one of his biggest challenges when Thomas Edison
discovered the light bulb. The invention of electricity severely threatened Rockefeller’s growing
empire – almost overnight the need for kerosene lamps was eliminated. Safer and more cost effective
than kerosene, electricity was threatening to destroy Rockefeller’s dynasty.

Amidst the potential ruin of his company, Rockefeller could have easily given in to the latest
technological revolution. Personally, he could have walked away and still have been able to survive
and live a more than comfortable life. But, it was not in Rockefeller’s nature to give up and walk away.
“The person who starts out simply with the idea of getting rich won’t succeed,” said Rockefeller. “You
must have a larger ambition.”

Instead of giving up on his business plans, Rockefeller decided to take advantage of another
burgeoning technology – the automobile. With the invention of the internal combustion engine for
individual transportation, Rockefeller could now not only distill oil into kerosene but also refine it into
gasoline. Rockefeller hedged his bets on the promise of the automobile and it paid off. Demand for the
automobile, and thus gasoline, exploded. Rockefeller had been saved in large part due to luck but also
in part to his ambition and his refusal to give up even in the face of disaster.

Rockefeller’s ambition stemmed from his upbringing. His mother, Eliza, made sure to give her children
a sense of encouragement in whatever they wanted to pursue. Even as a young boy, Rockefeller would
purchase candy by the pound, divide it up, and sell it to his siblings for a profit. He once also found a
turkey nest, stole the baby turkeys and raised them for later sale. Any money that Rockefeller made
was then put into a small blue china bowl on the family’s mantel to help assist them.

Whether he had a family who depended on him or he was simply supporting himself, Rockefeller
pursued his work with ambition, determined never to give up on his goals.

“The ability to deal with people is as purchasable a commodity as sugar or coffee and I will pay more
for that ability than for any other under the sun,” said Rockefeller.

In his decades of business, one of the key characteristics that propelled Rockefeller to success was his
strong leadership. It wasn’t his status, nor his age that made Rockefeller a great leader. Instead, it was
his influence. People around him wanted to follow him; they were inspired by him to do more than they
ever thought they were capable of. It was his ability to create a strong sense of teamwork and his own
energy and passion that drove his workers and thus his company.

“I would rather earn 1% off of 100 people's efforts than 100% of my own efforts,” said Rockefeller.
With this attitude, it would be necessary for Rockefeller to instill within his workers the same sense of
desire to succeed that he had, and indeed, he did. He was a hands-on leader who valued the interaction
he would have with his workers on a daily basis. He never believed to be above any of his staff, even
going down to the refineries on a regular basis to sweep up so that workers could continue their efforts
without any interruptions.

“Good leadership consists of showing average people how to do the work of superior people,” he said.
Indeed, Rockefeller knew that he, too, was just an average person trying to do above-average work. He
knew that there would be times when he too, as the leader, would make mistakes. However,
Rockefeller took full responsibility for his actions, whether they were failures or success. “Don't blame
the marketing department,” he once said. “The buck stops with the chief executive.” It was this
accountability that earned him the respect of many of his colleagues.

“I believe in the dignity of labor, whether with head or hand,” said Rockefeller. “That the world owes
no man a living but that it owes every man an opportunity to make a living.” Rockefeller’s own dignity
was questioned many a time, including a particularly brutal series of attacks by journalist Ida Tarbell.

In a series of articles for McClure Magazine in 1902, Tarbell began exposing Standard Oil and
Rockefeller as two of the greatest evils in America for their monopolistic and ruthless business
practices. While Tarbell was in no way impartial – her father had been put out of business by
Rockefeller years before – her articles went a long way in demonizing Rockefeller in the eyes of the
American people.

But, in a demonstration of maturity and strong leadership, Rockefeller’s response to Tarbell and his
other critics was silence. “Let the world wag,” he used to love to say. While many saw Rockefeller’s
silence as an admission of his guilt, Rockefeller preferred to carry on with his business and not get
distracted by media attacks, as he knew that as he continued to grow in size and power, public scrutiny
over his activities would only increase.

Rockefeller was a strong leader who used his personal charisma and passion to inspire those around
him. No matter how far he pushed the envelopes, he ensured himself a loyal staff behind him.

“God gave me my money,” said Rockefeller. “I believe the power to make money is a gift from God to
be developed and used to the best of our ability for the good of mankind.”

Rockefeller could have left his legacy at the enormous fortune he had amassed throughout his career.
He would have undoubtedly been remembered as one of the shrewdest and most successful
entrepreneurs in history. But, a deeply religious man, Rockefeller was unsatisfied with that.

“The only question with wealth is, what do you do with it,” said Rockefeller. Applying the same focus
and shrewdness to his charitable vision as he did with his company, Rockefeller decided early on in life
to devote much of his wealth and energy to benevolent efforts. From establishing Spelman College in
Atlanta and Spelman Seminary to teach freed female slaves to endowing the University of Chicago,
Rockefeller decided to listen to his conscience in deciding how to best use his wealth.

“Having been endowed with the gift I possess, I believe it is my duty to make money and still more
money and to use the money I make for the good of my fellow man according to the dictates of my
conscience,” said Rockefeller. “I was trained from the beginning to work and to save. I have always
regarded it as a religious duty to get all I could honorably and to give all I could. I was taught that way
by the minister when I was a boy.”

Rockefeller also established the Rockefeller University, the Rockefeller Institute for Medical Research,
the General Education Board, the Rockefeller Sanitation Commission, and the Rockefeller Foundation.
“I believe that every right implies a responsibility; every opportunity an obligation; every possession a
duty,” he said. Rockefeller’s work with the University of Chicago even almost led to a nervous
breakdown; much of his hair would fall out and he would experience frequent digestive problems. But,
he would continue in his quest to respond to appeals for funds from various sources believing it was his
duty to do so.

“It is wrong to assume that men of immense wealth are always happy,” said Rockefeller. He
understood that wealth did not equal happiness and while he was appreciative of the fortune he had
amassed, he believed that only in giving it away would he understand true happiness. His religious
upbringing and his conscience both dictated his duty to do so.

But, Rockefeller’s business aptitude and his keen eye for efficiency were not lost in his charitable
vision. “Charity is injurious unless it helps the recipient to become independent of it,” he believed. It
was only after much careful study and the assistance of expert advisers that Rockefeller made his
decisions as to who to donate funds to. He wanted his money to be used as effectively as possible,
much like he ran his business.

Rockefeller listened to his conscience and wound up giving away more of his fortune than he kept,
which was the second half of the great legacy which he created.

Rockefeller's Quote :

If you want to succeed you should strike out on new paths, rather than travel the worn paths of accepted
success.

I do not think there is any other quality so essential to success of any kind as the quality of
perseverance. It overcomes almost everything, even nature.

Good leadership consists of showing average people how to do the work of superior people.

I would rather earn 1% off a 100 people's efforts than 100% of my own efforts.

The person who starts out simply with the idea of getting rich won’t succeed; you must have a larger
ambition.

God gave me my money. I believe the power to make money is a gift from God . to be developed and
used to the best of our ability for the good of mankind. Having been endowed with the gift I possess, I
believe it is my duty to make money and still more money and to use the money I make for the good of
my fellow man according to the dictates of my conscience.

I always tried to turn every disaster into an opportunity.

Don't be afraid to give up the good to go for the great.

I believe that every right implies a responsibility; every opportunity an obligation; every possession a
duty.

The most important thing for a young man is to establish credit - a reputation and character.

The way to make money is to buy when blood is running in the streets.

I believe in the dignity of labor, whether with head or hand; that the world owes no man a living but
that it owes every man an opportunity to make a living.

The only question with wealth is, what do you do with it?

If your only goal is to become rich, you will never achieve it.

I have ways of making money that you know nothing of.

I believe that thrift is essential to well-ordered living.

Charity is injurious unless it helps the recipient to become independent of it.

I can think of nothing less pleasurable than a life devoted to pleasure.

Do you know the only thing that gives me pleasure? It's to see my dividends coming in.

The ability to deal with people is as purchasable a commodity as sugar or coffee and I will pay more
for that ability than for any other under the sun.

Competition is a sin.

Singleness of purpose is one of the chief essentials for success in life, no matter what may be one's aim.

Next to doing the right thing, the most important thing is to let people know you are doing the right
thing.

It is wrong to assume that men of immense wealth are always happy.

The person who starts out simply with the idea of getting rich won't succeed; you must have a larger
ambition. There is no mystery in business success. If you do each day's task successfully, and stay
faithfully within these natural operations of commercial laws which I talk so much about, and keep
your head clear, you will come out all right.

I believe in the supreme worth of the individual and in his right to life, liberty, and the pursuit of
happiness.

Don't blame the marketing department. The buck stops with the chief executive.

A friendship founded on business is a good deal better than a business founded on friendship.

The secret of success is to do the common things uncommonly well.

According as you put something in, the greater will be your dividends of salvation!