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13 Feb 2017, 02:25
Kudos
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a part of an annual report sent to stockholders by Olympic Foods, a processor of frozen foods -
"Over time, the costs of processing go down because as organizations learn how to do things better, they become efficient. In color film processing, e.g, the cost of 3 X 5 inch print fell from 50 cents for 5 day service in 1970 to 20 cents for 1 day service in 1984. The same principle applies to the processing of food. And since Olympic foods will soon celebrate its 25th birthday, we can expect that our long experience will enable us to minimize costs and thus maximize profits"
ANSWER
-The argument claims that the time period is inversely proportional to the cost of processing since organizations become smart to do things in an efficient manner. As a matter of example, Olympic foods is expecting minimizing cost and maximizing profits relying on its 25 years of experience in the food processing field. Stated in this way the argument reveals examples of poor reasoning and ill defined evidence. The conclusion of argument relies on assumptions for which there is no clear evidence and hence the argument is unconvincing.
First, the argument readily assumes that different industries share a common principle of cost reduction. For example, in the argument the author has given example of color film processing industry explaining the cost reduction over a period of 14 years in processing the color films. The author effortlessly assumes that the same principle applies to food industry. Since the modus operandi of both the industries is different, there processes or methods, equipments, capability of processing are indeed very different. Clearly, the author fails to mention a suitable example to support his/her claim. The argument could have been much clearer if the author would have mentioned an example of food industry in processing frozen foods.
Second, the argument claims that ‘over time, the costs of processing go down’ which is again a very weak claim. The author fails to mention exact time frame and states a generalized statement with no clear idea. To illustrate the claim in his/her support, the author gives the example of color film processing industry and states the fact that the cost of film processing reduced in 14 years time frame. This fact is unsuccessfully compared with Olympic foods experience of 25 years in food industry. The author also assumes the fact that the technology of frozen food processing will remain constant for more than 25 years and Olympic foods will apply the lessons learnt for next few years to maximize the profits. This seems rather the wishful thinking of author than the substantive evidence.
In conclusion, the argument is flawed for the above mentioned reasons and is therefore unconvincing. It could be considerably strengthened if the author clearly mentioned about exact time frame for learning efficient operations for organizations, comparison among same industries and accounting for changes in technology with time. Without these information the argument remains unsubstantiated and open to debate.
"Over time, the costs of processing go down because as organizations learn how to do things better, they become efficient. In color film processing, e.g, the cost of 3 X 5 inch print fell from 50 cents for 5 day service in 1970 to 20 cents for 1 day service in 1984. The same principle applies to the processing of food. And since Olympic foods will soon celebrate its 25th birthday, we can expect that our long experience will enable us to minimize costs and thus maximize profits"
ANSWER
-The argument claims that the time period is inversely proportional to the cost of processing since organizations become smart to do things in an efficient manner. As a matter of example, Olympic foods is expecting minimizing cost and maximizing profits relying on its 25 years of experience in the food processing field. Stated in this way the argument reveals examples of poor reasoning and ill defined evidence. The conclusion of argument relies on assumptions for which there is no clear evidence and hence the argument is unconvincing.
First, the argument readily assumes that different industries share a common principle of cost reduction. For example, in the argument the author has given example of color film processing industry explaining the cost reduction over a period of 14 years in processing the color films. The author effortlessly assumes that the same principle applies to food industry. Since the modus operandi of both the industries is different, there processes or methods, equipments, capability of processing are indeed very different. Clearly, the author fails to mention a suitable example to support his/her claim. The argument could have been much clearer if the author would have mentioned an example of food industry in processing frozen foods.
Second, the argument claims that ‘over time, the costs of processing go down’ which is again a very weak claim. The author fails to mention exact time frame and states a generalized statement with no clear idea. To illustrate the claim in his/her support, the author gives the example of color film processing industry and states the fact that the cost of film processing reduced in 14 years time frame. This fact is unsuccessfully compared with Olympic foods experience of 25 years in food industry. The author also assumes the fact that the technology of frozen food processing will remain constant for more than 25 years and Olympic foods will apply the lessons learnt for next few years to maximize the profits. This seems rather the wishful thinking of author than the substantive evidence.
In conclusion, the argument is flawed for the above mentioned reasons and is therefore unconvincing. It could be considerably strengthened if the author clearly mentioned about exact time frame for learning efficient operations for organizations, comparison among same industries and accounting for changes in technology with time. Without these information the argument remains unsubstantiated and open to debate.
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