Final answer:
Andrew Carnegie practiced vertical integration, owning all factors of production in the steel industry to cut costs and ensure quality, giving his business partner room to operate.
Step-by-step explanation:
Andrew Carnegie, having risen to prominence as a leading steel magnate, practiced vertical integration to maintain control over the steel production process. This business strategy involved the direct ownership of all factors of production, such as mines, foundries, and railroads. By owning these components, Carnegie eliminated the need for middlemen, which allowed his business partner to have "room to operate" by cutting costs and ensuring a consistent quality of the steel produced. The consolidation of the steel industry under Carnegie's leadership demonstrates his ability to capitalize on smart business decisions, such as employing up-to-date machinery, embracing innovation, and seizing opportunities to expand during economic recessions by using saved profits to buy out competitors.