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ram2811
Joined: 26 May 2016
Last visit: 25 May 2017
Posts: 1
Location: Greece
Schools: LBS MIF '19 (A)
GMAT 1: 650 Q46 V34
GPA: 3.54
WE:Information Technology (Finance: Investment Banking)
26 May 2016, 10:28
Kudos
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Argument
The following appreared in a report presented for discussion at a meeting of the directors of a company that manufactures parts of heavy machinery
"The falling revenues that the company is experiencing coincide with delays in manufacturing. These delays, in turn, are due in large part to poor planing in purchasing metals. Consider further that the manager of the department that handles purchasing of raw materials has an excellent background in general business, psychology, and socialogy, 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"
Analysis
The argument states that a heavy machinery parts manufacturer is facing falling revenues due to delays in manufacturing. This is further attributed to poor planning of purchase of metals. The poor planing in blamed on the manager of the purchase department who has a good background in skills more attuned to sales but little knowledge about metals. The way to overcome this is to replace the purchase manager with a scientist who knowledgeable in metals. The current purchase manager should be moved to sales where his experience and skills are more useful.
There are certain glaring points which might have been overlooked in arriving at the argument's conclusion, lack of knowledge about metals of the purchase manager. The delay in purchasing raw material could be due to other factors which cannot be controlled by anybody in the company. First, the metals might be in shortage in the market causing delays in delivery not just for this company but to everyone else. Second, the company might be short on cash or credit as a result of which suppliers are holding up or delaying delivery.
The manager's experience in general business, psychology and sociology could be beneficial in the purchase department as well. These skills would enable the manager to maintain a good relationship with suppliers and also negotiate better prices of raw materials. Replacing the purchase manager with a scientist is not an appropriate solution to the underlying problem. Though the scientist's knowledge might enable the company to get better quality metals it is not enough to explain the delays causing loss in revenue.
My conclusion is that the argument is weak since it does not elaborate or delve into other factors that could be the root cause of the problem. A more sound argument would have given supporting evidence about why the delays are solely the lack of metals knowledge on the purchasing manager's part and not external factors.
The following appreared in a report presented for discussion at a meeting of the directors of a company that manufactures parts of heavy machinery
"The falling revenues that the company is experiencing coincide with delays in manufacturing. These delays, in turn, are due in large part to poor planing in purchasing metals. Consider further that the manager of the department that handles purchasing of raw materials has an excellent background in general business, psychology, and socialogy, 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"
Analysis
The argument states that a heavy machinery parts manufacturer is facing falling revenues due to delays in manufacturing. This is further attributed to poor planning of purchase of metals. The poor planing in blamed on the manager of the purchase department who has a good background in skills more attuned to sales but little knowledge about metals. The way to overcome this is to replace the purchase manager with a scientist who knowledgeable in metals. The current purchase manager should be moved to sales where his experience and skills are more useful.
There are certain glaring points which might have been overlooked in arriving at the argument's conclusion, lack of knowledge about metals of the purchase manager. The delay in purchasing raw material could be due to other factors which cannot be controlled by anybody in the company. First, the metals might be in shortage in the market causing delays in delivery not just for this company but to everyone else. Second, the company might be short on cash or credit as a result of which suppliers are holding up or delaying delivery.
The manager's experience in general business, psychology and sociology could be beneficial in the purchase department as well. These skills would enable the manager to maintain a good relationship with suppliers and also negotiate better prices of raw materials. Replacing the purchase manager with a scientist is not an appropriate solution to the underlying problem. Though the scientist's knowledge might enable the company to get better quality metals it is not enough to explain the delays causing loss in revenue.
My conclusion is that the argument is weak since it does not elaborate or delve into other factors that could be the root cause of the problem. A more sound argument would have given supporting evidence about why the delays are solely the lack of metals knowledge on the purchasing manager's part and not external factors.
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