essay - GMAT Analysis of Argument2

Question:
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."

Discuss how well reasoned ... etc.

Answer:
Since there are several jumps of logic, the argument doesn't reach the level of convincing people that the proposition will be a good choice for the company.

First, the argument states the correlation between the time when the company had only one location and the fact that the company made good profits at the time, but the correlation cannot be proved in a logical manner. It means that the argument doesn't prove that the profits came from the fact that the company had only one location. Therefore, one can also say that the company generated the profits only because external environment like economic boom contributed to the profitability at the time.

Second, more importantly, although the argument reaches a conclusion that the company will consolidate its branch offices into one location in order to achieve higher profitability and better management carried off by concentrated supervision, but this causal correlation, which is between the action and the result, is not logical enough to make the argument persuasive. It means that even if the company gained high profitability through having only one location, the situation surrounding the company now would be different from one at the time, resulting in the situation that the action will bring a wrong effect like a decrease of its sales.

If the argument has the logical explanations to solve the jumps of logic mentioned above, it will be persuasive enough to convince all stakeholders to agree on and follow the decision. However, if the jumps of logic cannot be wiped out, the conclusion that the argument proposes has a serious flaw that might aggravate the company's condition.