Argument - Profit and new employees

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Argument - Profit and new employees

by jerryragland » Fri Mar 26, 2010 4:40 pm
Please review this argument and score. Also, take a look and score my other essays as well. Also give comments and suggestions.

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The following appeared in a memorandum from the CEO of a consumer electronics manufacturing firm to the head of the company's human resources department, who is responsible for hiring new employees:

"Eight years ago, our firm's profits were increasing with each new employee we added. We discovered that each employee had the skills and motivation to generate more revenue for the firm than his or her salary cost us. However, for the past two years, our profit margin has been falling, even though we have continued to add employees. Thus, our newer employees are not generating enough revenue to justify their salaries. We must not be hiring new employees with the same level of skills and motivation as those we used to attract. Clearly, then, failures in the human resources department account for our falling profits."

Discuss how well reasoned . . .etc.


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In the preceding statement, the author claims that the decrease in profit is due to the newer employees and their salaries and compares the employees in the past to justify the conclusion. The author presents a poorly reasoned argument is based on several questionable premises and assumptions, hence makes conclusion derived is illogical.

The primary issue with the author's reasoning lies in his unsubstantiated premises. There are two major flaws in the argument. First, the author correlates the revenue with the salary of each employee in a questionable manner. Author's point suggest that employees' salary and the revenue generated by the employee are the only two parameters in determining a firm's profit, which is incorrect. A firm's profit depends on lots of other parameters like inventory, machinery, marketing and management etc. and they all should be taken in to consideration when analysing profit or loss. Secondly, author falsely assumes that the newer employees are the cause for the decline in the profit and there is no logical reasoning behind it to prove so. If the issue has to be looked just from the employee perspective, there could be a possibility that over all employees' skills and/or motivation could have be declined over a period of time and might have caused the declince. So, in that case blaming just the new employees is not logically convincing and will not help in deriving conclusions from it.

The author makes two conclusions based on his/her assumptions. Both of them of are derived based from the above presented illogical assumptions which targets the just the new employees, their skill and/or motivation level. This also makes the second and final conclusion in blaming the HR department for the profit decline invalid. To determine the cause for profit decline in the firm the author should come up with a thorough analysis on all levels of the firm, include statistically evidences and only then a logical conclusion can be derived.
Source: — GMAT Essays (AWA) |

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