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"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."
Analysis of an argument:
The World is going global; with the world are the companies. There are both risks and benefits while expanding a business to other locations. The argument above discusses one such situation. Though the argument compares profitability with operations it fails to provide data to substantiate the reason.
The argument assumes that the decrease in profits is because the company is operating in multi-locations. It also assumes that field offices are not profitable. It seems that the author blindly believes in centralization to improve profits. The argument also assumes that centralization would cut costs and maintain better supervision.
There could be some businesses like online Ticket booking system, where centralization could improve profits. But the author without any data in hand simply assumes that decrease in profits is because of company multi-location strategy, which is a flaw. There could be other factors such as Economy recession, Inflation etc which could have affected the profits. The author also didn't consider the investment on establishing field offices. The profits could have gone because of this. There is no data or analysis on how centralization would help in cutting costs and maintain better supervision. If Apogee is a manufacturing company there could be transportation, labor costs etc which could, in a long run affect profits more than establishing field offices. A decentralized small staff can be better supervised than a single big centralized staff.
The argument could have been better if there is a proper study on how field offices are performing and how are profits across all the locations. There should be many factors that are to be considered while establishing a field office. There is many MNC's operating in many locations primarily to interact better with the people of the location, understand them and perform better. There are also many companies which are operating with very limited offices by using different technologies like VOIP, Tele-conference, Video conference etc.The reason could be there are able to meet the needs of the customer by using those technology. So a wise decision of establishing a field office or not depends on the kind of business and the amount of business.
"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."
Analysis of an argument:
The World is going global; with the world are the companies. There are both risks and benefits while expanding a business to other locations. The argument above discusses one such situation. Though the argument compares profitability with operations it fails to provide data to substantiate the reason.
The argument assumes that the decrease in profits is because the company is operating in multi-locations. It also assumes that field offices are not profitable. It seems that the author blindly believes in centralization to improve profits. The argument also assumes that centralization would cut costs and maintain better supervision.
There could be some businesses like online Ticket booking system, where centralization could improve profits. But the author without any data in hand simply assumes that decrease in profits is because of company multi-location strategy, which is a flaw. There could be other factors such as Economy recession, Inflation etc which could have affected the profits. The author also didn't consider the investment on establishing field offices. The profits could have gone because of this. There is no data or analysis on how centralization would help in cutting costs and maintain better supervision. If Apogee is a manufacturing company there could be transportation, labor costs etc which could, in a long run affect profits more than establishing field offices. A decentralized small staff can be better supervised than a single big centralized staff.
The argument could have been better if there is a proper study on how field offices are performing and how are profits across all the locations. There should be many factors that are to be considered while establishing a field office. There is many MNC's operating in many locations primarily to interact better with the people of the location, understand them and perform better. There are also many companies which are operating with very limited offices by using different technologies like VOIP, Tele-conference, Video conference etc.The reason could be there are able to meet the needs of the customer by using those technology. So a wise decision of establishing a field office or not depends on the kind of business and the amount of business.
