AWA MGMAT Mock 6

[steve.tan.chee.wei]

hi,

this is the first time i've encountered such essay topic and was honestly just stabbing in the dark.

kindly help to review!

thanks



Read the statement(s) and the instructions that follow, and then make any notes that will help you plan your response. Begin typing your response in the box at the bottom of the screen.
The following appeared in a memo to executives at a company that manufactures industrial equipment:

"We are spending too much on free customer service after a sale has been made; we need to limit our warranty to two years in order to improve our profit margins. The current lifetime warranty can lead to costs decades into a product's life cycle. Also, we pay our customer service employees a premium because they must possess expert skills across the entirety of our very diverse product line, including products we no longer sell."

Discuss how well reasoned you find this argument. Point out flaws in the argument's logic and analyze the argument's underlying assumptions. In addition, evaluate how supporting evidence is used and what evidence might counter the argument's conclusion. You may also discuss what additional evidence could be used to strengthen the argument or what changes would make the argument more logically sound.

The memo informs the company executives of a plan to change the warranty period in order to improve their company's profit margin. The reasoning given is flawed and some concerns needs to be addressed before we can accept the argument.

Firstly, the memo highlighted that there the cost of the free customer service is already too large and that they can improve the profit margin by cutting down the warranty period from a lifetime to two years. However, the number of warranty claims for the first two years of the equipments sold is not given. It could be the case that most of the equipments that they sold encounter issues in the first two years of usage.

Secondly, the memo continue by expounding that the cost of the current lifetime warranty continues into decades of a product's life cycle. This claim is lacking supportive data that shows the typical life cycle duration of the equipment used by their customer. For example, the customer may not experienced much issues at all with the equipment or the customer could have some policy which replaces or upgrades their equipment in lesser time that the memo stipulated.

Thirdly, the memo also mentions that their current customer service demands a premium over the market rate because of their expert knowledge on this company's diverse range of products. However the data to show the overall cost for customer service across this industry is not provided. It is possible that although this company pays a premium for their customer service but due to the highly qualified staff, they do not need to hire a very large number of customer service staff.

So overall the points raised in the memo needs to be strengthen to address the points mentioned in the above before we can better evaluate the correctness of the memo.

[NelsonP219]

Nice post.