Analysis of an Issue still possible AWA question?

Thank you Brent, Rich, and David for your responses.

I just took another practice AWA and I would be really curious about a score approximation. I have seen that most requests for AWA rating are not replied to here in the forum, however, I will see if I get lucky today

You would help me a lot by providing me with some brief feedback.

Thanks a lot - here is the essay:

The following appeared as part of an annual report sent to stockholders by Olympic Foods, a processor of frozen foods:

"Over time, the costs of processing go down because as organizations learn how to do things better, they become more efficient. In color film processing, for example, the cost of a 3-by-5-inch print fell from 50 cents for five-day service in 1970 to 20 cents for one-day service in 1984. The same principle applies to the processing of food. And since Olympic Foods will soon celebrate its 25th birthday, we can expect that our long experience will enable us to minimize costs and thus maximize profits."
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The argument presented above is concerned with the theory of the learning curve effect on an organization's process efficiency. The author claims that as an organization learns how to improve processes over time. He uses the example of increased efficiency in the color film processing industry to come to the conclusion that the learning curve principle must also apply to food processing. He predicts that the company Olympic Foods will be able to reduce its costs to a minimum and increase profits based on the fact, that the company has been around for almost 25 years. However, this argument is significantly flawed, as it fails to provide sufficient evidence for the claims made by the author.

First, the argument is based on the assumption that the learning curve effects observed in the color film processing industry also apply in the same manner to the food processing industry. Without further evidence, however, the reader does not have any information in support of this assumption. In fact, the characteristics of food are quite different from those of color films. For example, food can not be stored the same way that color films can, as food is perishable and requires certain temperatures, so that it does not go bad. Since such differences are not addressed in the argument, it remains questionable whether the principles applying to color film processing also apply to food processing.

Second, the author claims that the 25 years of experience of Olympic Foods will enable the company to minimize costs while maximizing profits. On the one hand, this claim is based on the assumption that 25 years of experience is sufficient to lead to significant learning curve effects and that those effects have not already been realized. The author fails to provide any evidence in support for this assumption, which is therefore not convincing. For example, efficiency increases due to learning curve effects may be most significant in the early years of a company and decrease as the company matures. If this was true, then the above mentioned company would not be able to see significant further efficiency effects after 25 years. On the other hand, we do not know whether efficiency increases leading to cost reductions would also translate into maximized profits. When considering the example of color film processing, there is no evidence that the reduced costs were accompanied by higher profits. The author would have to provide additional information on the development of sales prices in order to evaluate whether the described effects would lead to higher profits.

In sum, the argument as stated is not convincing, as it fails to provide sufficient evidence for its claims. The author could, however, significantly strengthen the argument by supporting his assumptions with relevant data. For example, he could provide information proving the comparability of the two mentioned industries with regard to the applicability of the learning curve effect. Furthermore, information on the development of sales prices and, consequently, profits would be necessary to evaluate his conclusion about Olympic Foods. If such additional evidence was provided, the author would be able to convince readers much better than is now the case.

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