“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 maintains better supervision of all employees.”
The argument from a memorandum claims that conducting all operations in one single location can increase a company’s profitability. Stated in this way the argument is inconclusive and fails to mention several key factors on the basis of which it could be evaluated, and reveals examples of a leap of faith and poor reasoning. The conclusion of the argument relies on assumptions for which there is no clear evidence. Hence, the argument is unconvincing and has several flaws.
First, the argument readily assumes that things that happened in the past will actually reflect on all forms in the future. The statement is a stretch and not substantiated in any way, because there could be several marketing indicators that led to Apogee creating new locations as profitable ventures in the business.
For example, it could be possible that the company had hit the ceiling in a particular geography and the only way to continue expanding was through building new offices in different areas. Clearly, solely relying on the past is not a good indicator of how things will turn out in the future. The argument could be much clearer if it explicitly stated Apogee’s size, revenue, and staff while making this claim.
Second, the argument claims that centralizing the workforce by cutting down on regional and field offices would improve profitability. This is again a very weak and unsupported claim as the argument does not demonstrate the correlation between centralizing and profitability. To illustrate, often centralizing instead of expanding could save a lot of upfront fixed cost at the very beginning, but after running for a while it starts to gain a hefty amount of money and greatly offset the cost. So centralizing and profitability might actually not toward in the same direction. Further, cutting off regional and field offices might also lead to harmful employee sentiments at the best and costly layoffs at the worst that the company may never recover from. If the argument had provided evidence that expanding is never going to turn profitable, then the argument would have been a lot more convincing.
Finally, the argument should answer questions such as: Why are the new offices not profitable? What are some of the financial projections for expanding new offices? What are the contributions of the field and regional offices to the company’s overall financial status? Without convincing answers to these questions, one is left with the impression that the claim is more to wishful thinking rather than 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 mentioned all the relevant facts. In order to assess the merits of a certain situation, it is essential to have full knowledge of all contributing factors. Without that information, the argument remains indefensible and open to debate.