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."
Response:
The argument that the Apogee Company should only operate out of a single location above is flawed. Although the Apogee Company opened up other locations, it does not mean that those locations were placed best, nor does it mean better supervision guarantees an increase in profitability. Other external factors may have influenced the decrease in profitability.
The Apogee Company has multiple locations and the company is less profitable. This argument provides no basis of whether the field offices are in locations that are near their customers. For example, if a company that sells doors and windows was in an extremely low populated area, the cost of running that location may not be justifiable based on the income for that location. Location is important to whether an office can be profitable.
The argument above also implies that better supervision would improve profitability. There is no evidence for this statement. The term `better supervision` may mean a few different things: stricter supervision or more proactive supervison. Although some workers may produce a better result when they are under strict supervision, other workers may produce a better result when they have less direct supervision. This argument provides no evidence of a correlation between better supervision and a profitability increase.
When the Apogee Company had one location, the company may have had a monopoly in the industry. It is possible that when the Apogee Company started expanding its operation and opening more field offices other companies also started up. It is also possible that there was a decline in the need or want for the goods that the Apogee Company provides. These are a few examples of other factors that may have influence the decrease of the profitability that could have coincided with the expansion.
The above argument could be strengthened if evidence was presented to show that the external locations are the cause of the decreased profitability. With no evidence to show that the expansion of locations was the cause of the decreased profit, it is difficult to conclude that the Apogee Company should close the field offices. If a definition of `better supervision` was provided, it would be easier to determine if this plays a main role in the output of employees.
As the argument is currently, it can not be concluded that closing the field offices would increase profitability. There no information about whether the field offices are in profitable locations, what better supervision means or the correlation to employee output, or if there were any external factors to influence the decreased profitability. If more information was provided about the external locations profitability or the correlation between employee output and better supervision, the conclusion would be easier to evaluate.
"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."
Response:
The argument that the Apogee Company should only operate out of a single location above is flawed. Although the Apogee Company opened up other locations, it does not mean that those locations were placed best, nor does it mean better supervision guarantees an increase in profitability. Other external factors may have influenced the decrease in profitability.
The Apogee Company has multiple locations and the company is less profitable. This argument provides no basis of whether the field offices are in locations that are near their customers. For example, if a company that sells doors and windows was in an extremely low populated area, the cost of running that location may not be justifiable based on the income for that location. Location is important to whether an office can be profitable.
The argument above also implies that better supervision would improve profitability. There is no evidence for this statement. The term `better supervision` may mean a few different things: stricter supervision or more proactive supervison. Although some workers may produce a better result when they are under strict supervision, other workers may produce a better result when they have less direct supervision. This argument provides no evidence of a correlation between better supervision and a profitability increase.
When the Apogee Company had one location, the company may have had a monopoly in the industry. It is possible that when the Apogee Company started expanding its operation and opening more field offices other companies also started up. It is also possible that there was a decline in the need or want for the goods that the Apogee Company provides. These are a few examples of other factors that may have influence the decrease of the profitability that could have coincided with the expansion.
The above argument could be strengthened if evidence was presented to show that the external locations are the cause of the decreased profitability. With no evidence to show that the expansion of locations was the cause of the decreased profit, it is difficult to conclude that the Apogee Company should close the field offices. If a definition of `better supervision` was provided, it would be easier to determine if this plays a main role in the output of employees.
As the argument is currently, it can not be concluded that closing the field offices would increase profitability. There no information about whether the field offices are in profitable locations, what better supervision means or the correlation to employee output, or if there were any external factors to influence the decreased profitability. If more information was provided about the external locations profitability or the correlation between employee output and better supervision, the conclusion would be easier to evaluate.
