Please, Please Rate My Analysis of an Argument Essay

[andrewpaulsimmons]

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GMAT Essay Prompt
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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.
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My Essay
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While the conclusion that the human resources department's failure to find skilled and motivated employees has caused the companies profits to fall is conceivably correct, there are many other factors which are disregarded in this argument. To start, both internal and external factors should be considered to evaluate the drop on profitability. The argument does not address how the market has changed over the past eight years. Additionally, the argument does not consider how the company has grown relative to the size of the market. Finally, no tests or other metrics are provided which juxtapose current productivity with previous productivity rates.

First, no information is given regarding how the company has been forced to compete. It is possible that a new similar business is driving down profits. The argument provides no insight to the companies current competitive stance and factors which may be adding to or reducing overall productivity. Another factor that can drive down profits is the overall economic state. The argument would be improved if it demonstrated that the external factors today were similar to the past .

Second, over the past 8 years the company may have grown considerably. It is possible that the company has grown to fill or even exceed the market demand. As more employees came in to the organization the workload became spread too thin. The argument only speaks about the entire employee body. It is possible that there are lot's of lower-level producers and too few sales people. The opposite would could be true. The argument could be strengthened greatly if it demonstrated that the human resource department had hired an unbalanced team. Unfortunately the argument provides no insight into the hiring strategies used by the HR department.

Third, while unskilled or unmotivated employees can be detrimental to the success of any organization, this argument does not share any information which allows the reader to gauge the real overall productivity of current employees in such a way that it can be compared to the overall productivity of employees eight years ago. Nevertheless, even assuming that the employees are less productive this does not mean that they did not start their career with this company as motivated and productive individuals. There could be bad management throughout the organization which demotivate otherwise capable employees. The argument would be strengthened if it addressed the quality of management in general.

In conclusion, the argument does not provide the details which are essential to evaluating the real cause of the downturn in profits currently experienced by this company. This lack of information weakens the argument and makes it difficult to determine whether the human resources department had any part in reduced profit-to-higher ratio. The argument would have been much stronger had it provided statistics on the current state of the market and overall employee productivity for today and the past. In short, the argument is formed on assertions and speculation which are weakly justified or not justified at all.

[grockit_andrea]

I'd give this a 5. You have great organization, and you wrote a lot, which is always good. You make cogent points, too. But there are a few flaws here. First, make time to proof-read your essay at the end. A few errors won't hurt your score, but you had more than a few: subject-verb disagreement, missing or repeated words, and incorrectly formed possessives all caught my eye at different points throughout the essay. And also, in your first two body paragraphs, you did a good job of both opening and closing the paragraph with references to the same idea. However, in your third body paragraph, the concluding sentence isn't closely related to the topic sentence. That confused me a little, and made me go back to read the paragraph again. You don't want your reader to doubt your organization or their understanding of your points, so stick with the same structure you had in the earlier body paragraphs.
Overall, though, this is a really good essay. You seem comfortable with this kind of writing, which is a big step in the right direction.

[SM2010]

Even though I'm no GMAT expert, I got a 6 in the AWA and have always been quite good in these type of essays so I'll give my suggestions.

I think that you've missed out one of the main flaws in the argument, which is that the author assumes that their firm has incurred constant costs throughout the years. The argument says that since profits have been falling, that means that employees have not been adding revenue. This is clearly false because it is possible that the employees could have been earning more revenue while the company has been experiencing falling profits due to increased costs. (Remember profit=revenue-cost).

The second flawed assumption by the author is by implying that the only cost to the firm is the salary it pays out to its workers. The author implies this by saying "Thus, our new employees are not generating enough revenue to justify their salaries" (due to falling profits as mentioned by the preceding sentence). Generally, wages account for roughly 60% of a firm's cost and therefore there are alot of other factors that could have caused the decline in profit. Perhaps throughout the two years the cost of machinery etc has gone up which means that profit levels will fall even though employees may be making enough revenue to justify their salaries.

I would also point out that the author is assuming that the amount of revenue an employee makes is directly related to their level of skill and motivation and as a result concludes that they must not be hiring new employees with the same level of skills and motivation. In reality, economic theory dictates that if there are too many workers in a factory, regardless of his or her skill, "overcrowding" will result which means that their 'marginal productivity' will decline, i.e. the amount that a worker will produce will become less and less. So when the author says "we must not be hiring new employees with the same level of skills and motivation", he is making a flawed assumption about the factors that determine the productivity of an individual. Perhaps the firm needs to stop hiring new workers full stop, and instead concentrate on ways to improve efficiency.

For the reasons mentioned above, claiming that it is because of failures in the human resources department that account for falling profits is ludicrous. Also the author is assuming that human resources department hire individuals based entirely on their 'marginal revenue product' (the contribution to revenue by a worker). It is very clear that human resources departments do not adopt this strategy depending on the type of firm. For example, it is almost impossible to determine the extent by which a secretary generates revenue for a firm, so does this mean that human resources department shouldn't hire secretaries at all in businesses? Clearly there so many factors that human resources take into account when hiring employees that the author hasn't considered.

Alot of the points you've made are similar to the ones I've made but I think it's important to have mentioned the effect of a firm's cost rather than its growth rate relative to the size of the market and the overall economic stance.