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12 Apr 2018, 17:11
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"The falling revenues that the company is experiencing coincide with delays in manufacturing. These delays, in turn, are due in large part to poor planning in purchasing in metals. Consider further that the manager of the department that handles purchasing of raw materials has an excellent background in general business, psychology, and sociology, but knows little about the properties of metals. The company should, therefore, move the purchasing manager to the sales department and bring in a scientist from the research division to be manager of the purchasing department."
A recent report to the directors of a heavy machine manufacturing company claims that replacing a purchasing manager will solve delays in manufacturing, and the coincidental fall of revenues. The report's argument, while attempting to establish a reasonable causation between the purchasing manager and falling revenue, ignores crucial considerations that dramatically weaken its argument.
The first consideration that the report ignores involves supporting facts that connect falling revenues with delays in manufacturing and poor planning in raw material purchases. Without citing explicit evidence that connects the the two premises: that delays in manufacturing causes falling revenues and that poor planning has led to manufacturing delays. For the reader, there are a multitude of exogenous factors that could be affecting the falling of revenues outside of manufacturing or raw material purchases. There could be massive bankruptcies across large outlet stores that sell the company's heavy machinery, effectively cutting off a substantial amount of sales. Because the argument does not delve into direct confirmation that delays in manufacturing is the sole reason behind falling revenue, the basis of and the conclusion itself is subsequently weakened.
The second consideration that the report does not investigate further is the assumption that knowing the properties of metals is equivalent to being good at planning raw material purchases. The report does not take into account any other required skills needed for purchases raw materials, skills such as sales, coordination, and supply chain management. The manager of the manufacturing department - who is said to have a poor understanding of metal properties - could have extensive knowledge in supply chain logistics, and the delays in manufacturing could be because of a miner strike or a factory union walk-out. Because the report does not conclusively show that only the manager's poor understanding of metals is the cause of poor raw materials purchasing - and thus causing delays in manufacturing - the argument cannot assume that only having metallurgic knowledge will improve planning purchases of raw materials.
The final consideration that the report oversteps is the fact that bringing in a new hire into the company will immediately fix all of the revenue problems. There are hiring and training costs that must be assessed before the new scientist begins planning metal purchases, all the while the company should be losing money as there is no active metal purchaser. Furthermore, the new scientist, while knowledgable in metals, will not necessarily know about non-metal raw materials, and can lead the company into a disastrous investment in subpar raw materials. Because the scientist has the one qualification that the previous manager did not, the argument cannot assume that the scientist will automatically perform better at supply chain logistics.
Because the report fails to consider these points, its argument is seriously flawed. If the report was more thorough and careful about its considerations and conclusions, then it would have been more persuasive in pushing for a new raw materials planner.
A recent report to the directors of a heavy machine manufacturing company claims that replacing a purchasing manager will solve delays in manufacturing, and the coincidental fall of revenues. The report's argument, while attempting to establish a reasonable causation between the purchasing manager and falling revenue, ignores crucial considerations that dramatically weaken its argument.
The first consideration that the report ignores involves supporting facts that connect falling revenues with delays in manufacturing and poor planning in raw material purchases. Without citing explicit evidence that connects the the two premises: that delays in manufacturing causes falling revenues and that poor planning has led to manufacturing delays. For the reader, there are a multitude of exogenous factors that could be affecting the falling of revenues outside of manufacturing or raw material purchases. There could be massive bankruptcies across large outlet stores that sell the company's heavy machinery, effectively cutting off a substantial amount of sales. Because the argument does not delve into direct confirmation that delays in manufacturing is the sole reason behind falling revenue, the basis of and the conclusion itself is subsequently weakened.
The second consideration that the report does not investigate further is the assumption that knowing the properties of metals is equivalent to being good at planning raw material purchases. The report does not take into account any other required skills needed for purchases raw materials, skills such as sales, coordination, and supply chain management. The manager of the manufacturing department - who is said to have a poor understanding of metal properties - could have extensive knowledge in supply chain logistics, and the delays in manufacturing could be because of a miner strike or a factory union walk-out. Because the report does not conclusively show that only the manager's poor understanding of metals is the cause of poor raw materials purchasing - and thus causing delays in manufacturing - the argument cannot assume that only having metallurgic knowledge will improve planning purchases of raw materials.
The final consideration that the report oversteps is the fact that bringing in a new hire into the company will immediately fix all of the revenue problems. There are hiring and training costs that must be assessed before the new scientist begins planning metal purchases, all the while the company should be losing money as there is no active metal purchaser. Furthermore, the new scientist, while knowledgable in metals, will not necessarily know about non-metal raw materials, and can lead the company into a disastrous investment in subpar raw materials. Because the scientist has the one qualification that the previous manager did not, the argument cannot assume that the scientist will automatically perform better at supply chain logistics.
Because the report fails to consider these points, its argument is seriously flawed. If the report was more thorough and careful about its considerations and conclusions, then it would have been more persuasive in pushing for a new raw materials planner.
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