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Author Message
Intern
Joined: 15 Feb 2017
Posts: 3

### Show Tags

10 Jan 2018, 11:09
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 employees.”

Discuss how well reasoned … etc.

---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The argument is about a company (the Apogee Company) that was more profitable when all its operations were in one location than today.
The author suggests that to improve profitability, Apogee Company should close its field offices and conduct all its operations from
a single location, cutting costs and helping the company maintain better supervision of all employees. The argument is superficial and
presents flaws in different points; it doesn't analyze the reason why the profitability of the company is declined with a less centralized structure,
and moreover presents the centralization as the solution for all the company's problems.

First, from the first line of the argument is possible to notice how the author attribute the decline in profitability to the decentralization
of the company without providing further information; in fact, a decline in profitability could depends on a decrease in revenues or on an increase
in costs, in either cases not necessary related to the decentralization of the company. Could be possible that the economy today is down due to a recession,
or that a new competitor entered the market steeling clients from the company. Different could be the reasons why the company lost profits,

Second, the argument describes the centralization as the solution to all the problems,
but instead could be possible that a distributed structure of the operations can help to improve the name of the company locally, attracting more
clients and in long term gaining more profits. Another reason on the fact that the centralization is wrongly considered the solution to the lost profits,
could be the fact that to re-centralize the operations the company must spend a lot in relocate people, lowering even more the profits.

As mentioned the argument is superficial, and a better analysis of the market today and before the decentralization is needed to better understand the causes
of the lost in profits, which could be caused by the decentralization, as the argument said, or there could be other factors that changed the profitability of the company.

In conclusion the argument is limited and presents different flaws that can be solved with a deep analysis of the context in which the company is and was.
Board of Directors
Joined: 01 Sep 2010
Posts: 3278

### Show Tags

10 Jan 2018, 11:50
Top Contributor
it is good but I would stretch it more, giving examples for instance.

here is a guide how to develop a 6.0 AWA https://gmatclub.com/forum/gmatclub-gui ... 36251.html

regards
_________________
Current Student
Joined: 27 May 2014
Posts: 524
GMAT 1: 730 Q49 V41

### Show Tags

10 Jan 2018, 12:36
sharp1989 wrote:
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 employees.”

Discuss how well reasoned … etc.

---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The argument is about a company (the Apogee Company) that was more profitable when all its operations were in one location than today.
The author suggests that to improve profitability, Apogee Company should close its field offices and conduct all its operations from
a single location, cutting costs and helping the company maintain better supervision of all employees. The argument is superficial and
presents flaws in different points; it doesn't analyze the reason why the profitability of the company is declined with a less centralized structure,
and moreover presents the centralization as the solution for all the company's problems.

First, from the first line of the argument is possible to notice how the author attribute the decline in profitability to the decentralization
of the company without providing further information; in fact, a decline in profitability could depends on a decrease in revenues or on an increase
in costs, in either cases not necessary related to the decentralization of the company. Could be possible that the economy today is down due to a recession,
or that a new competitor entered the market steeling clients from the company. Different could be the reasons why the company lost profits,

Second, the argument describes the centralization as the solution to all the problems,
but instead could be possible that a distributed structure of the operations can help to improve the name of the company locally, attracting more
clients and in long term gaining more profits. Another reason on the fact that the centralization is wrongly considered the solution to the lost profits,
could be the fact that to re-centralize the operations the company must spend a lot in relocate people, lowering even more the profits.

As mentioned the argument is superficial, and a better analysis of the market today and before the decentralization is needed to better understand the causes
of the lost in profits, which could be caused by the decentralization, as the argument said, or there could be other factors that changed the profitability of the company.

In conclusion the argument is limited and presents different flaws that can be solved with a deep analysis of the context in which the company is and was.

http://www.gmatawa.com/
_________________
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