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# My AWA, topic #1 from 12th Review

Author Message
Manager
Joined: 12 Dec 2012
Posts: 160
Location: Poland
Followers: 5

Kudos [?]: 187 [0], given: 67

My AWA, topic #1 from 12th Review [#permalink]

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24 Mar 2013, 11:45
Hello, this is my AWA on the topic #1 from the 12th Review.
I can see a few great reviewers here, I suppose that many of you know the topic by heart already.
I would be grateful if you could assess my AWA, too.

Here it is:
Quote:

1. The following appeared as 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 more efficient. In color film processing, for example, the cost of a 3-by-5-inch print fell from 50 cents for five-day service in 1970 to 20 cents for one-day service in 1984. The same principle applies to the processing of food. And since Olympic Foods will soon celebrate its twenty-fifth birthday, we can expect that our long experience will enable us to minimize costs and thus maximize profits.”

Discuss how well reasoned you find this argument. In your discussion be sure to analyze the line of reasoning and the use of evidence in the argument. For example, you may need to consider what questionable assumptions underlie the thinking and what alternative explanations or counterexamples might weaken the conclusion. You can also discuss what sort of evidence would strengthen or refute the argument, what changes in the argument would make it more logically sound, and what, if anything, would help you better evaluate its conclusion.

The author of the argument contends that the costs of processing get lower over time because organizations learn more effective ways to operate. Basing on that idea, the author concludes that Olympic Foods should maximize profits due to its twenty-fifth birthday this year.

The logic of this argument is flawed in several ways. First, the author assumes that organizations do actually learn over time. Second, basing on the previous assumption, the author makes another assumption that the better ways of doing things always result in higher profits. Third, the example given is not precise and not adequate to food processing. Let me elaborate my points.

First of all, the contention that organizations learn over time how to operate more efficient is a pure assumption. It is true that the technology advances in general, but this does not mean that all organizations implement and draw on new technologies. A company would need a lot of capital and well-educated staff to apply new technologies, and not every firm has them.

Secondly, the author equals higher efficiency with higher profits. What if improvement in technology is just necessary to stay on market? This could be rationalized by competitiveness on market alone. Or if it is required by the State or by the Working Unions? In such circumstances, higher efficiency could assure further existence of the company or better working conditions, but not at all higher profits.

Finally, the author’s example is imprecise: 50 cents per 5 days in 1970 equal 10 cents per day, which is 100% more than 20 cents per day in 1984. This is a good example of improvement in speed, but not in cost effectiveness. Moreover, color film processing is a completely different thing than food processing and it essentially doesn’t provide a sound comparison.

In conclusion, after pointing the three most visible flaws of the argument, it is clear that it is just not convincing. One thing that would strengthen the argument would be to mention an actual means to improve the cost effectiveness. The main assumption could be buttressed also through a better related example, say from the history of the company. A conclusion contingent just upon assumption such as in this case is not logical.

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Manager
Joined: 12 Dec 2012
Posts: 160
Location: Poland
Followers: 5

Kudos [?]: 187 [0], given: 67

Re: My AWA, topic #1 from 12th Review [#permalink]

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02 Apr 2013, 06:04
Please guys, give me a few words on that one. Whether you consider it good or rather mediocre, I don't ask for scrutiny .
_________________

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Re: My AWA, topic #1 from 12th Review   [#permalink] 02 Apr 2013, 06:04
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