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vineetbatra · Mon Oct 05, 2009 1:00 pm

Question - If I cannot think of an example then what is the best course of action, can I just make up something, or give a personal example

The following appeared in a report presented for discussion at a meeting of the directors of a company that manufactures parts for 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 planning in purchasing metals. Consider further that the manager of the department thathandles 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 thesales department and bring in a scientist from the research division to be manager of the purchasing department.”
Discuss how well reasoned . . . etc.

The decision by the Board of Directors of the company to replace the existing manager of the Purchase Department with Scientist from the resarch division lacks any credible evidence to be able to justify the decison, moreover the premise on which this decison is taken does not contain any statistical information to substantiate the claim that the reduced purchases is due to the purchase manager. The argument above does not consider the demand of the parts, the availability of the metals and even the qualifiation of the scientist to manage the purchase department.

The argument mentions that the reduced sales of the parts coincide with the reduced manufacturing, and inadverantly assumes that the reduced sales is due to reduced manufacturing, no where the argument mentions the demand of the parts and whether increased manufacturing would be consumed by the existing demand. Maybe the reduced manufacturing is due to the reduced sales and not other way around.

Further, the argument does not even mention anything about the availabilty of the raw material and solely put the blame on the planning of purchasing material, without any clear insight on how the lack in planning caused problems with the procurement. Also, the argument mentions that the the manager has a good understanding of the business but lacks any knowledge on properties of metals, but it does not mention that knowing the properties of metal is important for procurement.

Finally, the decison to make the scientist to manage the purchase department is not substantiated with any qualification requirement for the manager of purchase departement. In a recent article in I came accross a term "Technolgy Orgasm", which means that it is usually not a very good idea to make a technical person manager of a division because being a technology person he would like to bring the best in technology without considering the business viability of that technology, similalry without doing through anaysis of the of the job requirement it might be counter productive to bring a scientist to manage the purchase division.

To conclude the decsion lacks the strength to be justified, if the argument would have considered the points mentioned above then it would have had a stronger case to rplace the existing purchase manager with the scientist.

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