Joined: 08 Jun 2010
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19 May 2011, 06:46
The following appeared in a memorandum from the business department of the Apogee Company:
“When the Apogee Company had all its operations in one location, it was more profitable than it is today. Therefore,
the Apogee Company should close down its field offices and conduct all its operations from a single location. Such
centralization would improve profitability by cutting costs and helping the company maintain better supervision of all
Discuss how well reasoned . . . etc.
The argument claims that Apogee company was more profitable in past than today ,when it had one location operation.And such act would improve profitability by cutting costs and helping the company maintain better supervision of all employees; therefore,
to increase the profitability company should closed it’s all other field offices and back on one location. stated in this way .The argument fail to mention several key points ,on the basis of which it could be evaluated .the conclusion relies on assumption ,for which there is no clear evidence.
Therefore, The argument is rather weak ,unconvincing and has several flaws.
First ,The argument readily assumes that Apogee company was more profitable in past than today ,when it had one location operation; Therefore ,
to increase the profitability company should closed it’s all other field offices and back on one location. This statement is a stretch and not substantiated in any way. apart from one location There can be other reason ,from which we can infer that profitability in old time was due to other factor apart from the only location. Such as, competition ,availability of commodity in that part etc.. for example When Wal-Mart entered in U.S. market in 1960s That time competition was concentrated only in urban area and Wal-Mart gained huge profit from their rural oriented strategy ,but after some time when competition increased Wal-Mart have to expand and decentralized their operation .it increased their customer base as well profits.
Clearly, The effect on location on profitability is indeed a flaw. The argument could have much clear if it explicitly stated that there is strong effect of one location rather than multi location.
Second, The argument claims that such act would improve profitability by cutting costs and helping the company maintain better supervision of all employees ; therefore,
to increase the profitability company should closed it’s all other field offices and back on one location. This is again a weal premises ,on which the conclusion relies. To illustrate this premises missing several crucial points ,on which the conclusion heavily depends.; such as , geographical density ,customer base, availability of raw material etc.
while we halt the operation cost and take strict supervision on employees but this could not increase the profitability; however without take those points in back of mind The result will be disastrous for the company .In fact company lost several it’s customers and potential markets . If the argument had provided that those points also taken in consideration before making the decision then The argument could have been more a lot more convincing
Finally, There are several untouched questions ;such as, What if company adopted this plan ,then would the profitability be same the old time? what if the other costs would risen ,because of this plan? what if company limited itself in less potential market and miss the bigger part of the world ,due the centralization? without providing the answer these question ,one is left with the impression that the clam is more of a wish full thinking rather than substantive evidence.
In conclusion , t he argument is flawed for the above mentioned reason and is therefore unconvincing .It could be considerable strengthened if the author clearly mentioned above all relevant facts .
In order to asses the merits of a certain situation ,it is essential to have full knowledge f all contributing factors. in this particular case without his information. the argument remain weak .
will be glad.if u point out flaws in my answer..........