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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 (n. 外地办事处) 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.” The author attributes the decline in profitability to the variation from operation in one location to operation in several field offices besides headquarters. He argues that by closing down field offices, costs will go down and supervision over employees will be enforced. Therefore, he suggest that the company should close down field offices and go back to singe-location model in order to improve profitability. However, his argument is not compelling since there are three primary flaws. First, single-location model may not be more profitable that the multiple one. The decline in profitability can result from other reasons as well. The economy overall might experience a severe fallback during the same period when the company lost its profit. It is also probable that management’s wrong judgment on the market trend led to a loss in market share. Second, closing down field offices do not necessarily result in fewer costs. The profitability depends on what industry the company is in. In delivery industry, it is highly essential for companies to set up field offices and warehouses across the country or even the world since transportation costs take up a major proportion in their total costs, by building those offices and warehouses, they can reduces their costs on transportation to a large extent and maximize profits as many as possible. Finally, enforced supervision might not happen through aggregating all the staff in single place. By doing so, the headquarter must be a gigantic institution where multiple layers of management are needed, which in turn, make the distance between employers and employees even larger longer than before. And Corruption is common in such a institution. Furthermore, such thing can harm the innovation of employees because their efforts are less able to be seen and rewarded. A deeper analysis into what actually caused the fall in profitability is necessary to enhance the validity of this argument. For instance, by comparing costs with those in a similar company which operates at just one location during the same period, a more substantiated conclusion could be reached. Besides, pointing out what industry is in and analyzing how the cost changes before and after affect the profitability would be helpful. If it is verified that the costs of maintaining the operation of field offices are indeed unnecessary and account for a large part of total expenses, the argument would be more convincing.
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发表于 2016-10-4 11:20:33
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