Vertical integration, moving forward or backward in the input-throughput-output stream, would be an example of:
A) Chandler's Phase 1, resource accumulation
B) Carnegie's strategy in the steel industry
C) McCallum's method of organization
D) both a and b above
E) both b and c above

Question

Quizplus · Accepted Answer

Vertical integration is a strategy in which a company owns and controls multiple stages of the production process, from raw materials to finished goods. This can be done by moving forward in the input-throughput-output stream (e.g., a steel company acquiring a coal mine) or backward (e.g., a car manufacturer acquiring a parts supplier). Chandler's Phase 1, resource accumulation, and Carnegie's strategy in the steel industry are both examples of vertical integration.

Vertical Integration, Moving Forward or Backward in the Input-Throughput-Output Stream