The following appeared as part of a memorandum from the vice president of Nostrum, a large pharmaceutical corporation:
“The proposal to increase the health and retirement benefits that our employees receive should not be implemented at this time. An increase in these benefits is not only financially unjustified, since our last year’s profits were lower than those of the preceding year, but also unnecessary, since our chief competitor, Panacea, offers its employees lower health and retirement benefits than we currently offer. We can assume that our employees are reasonably satisfied with the health and retirement benefits that they now have since a recent survey indicated that two-thirds of the respondents viewed them favorably.”
Discuss how well reasoned you find this argument. In your discussion be sure to analyze the line of reasoning and the use of evidence in the argument. For example, you may need to consider what questionable assumptions underlie the thinking and what alternative explanations or counterexamples might weaken the conclusion. You can also discuss what sort of evidence would strengthen or refute the argument, what changes in the argument would make it more logically sound, and what, if anything, would help you better evaluate its conclusion.
The Vice President of Nostrum, a large pharmaceutical corporation, makes his case for a cost-cutting measure by asserting that the proposed increase in health and retirement benefits is unnecessary. His reasoning is weakened by a lack of supporting evidence, and the article’s conclusion is based on questionable assumptions and insufficient evidence
On the surface, the vice president appears to be correct. Panacea, a competitor, currently provides its employees with fewer benefits than does Nostrum. Furthermore, the vice president’s assertion that his corporation’s profits are lower this year than last year appears to corroborate his claim. However, a closer examination of the facts reveals that Nostrum’s profits this year are considerably higher than last year, and last year’s profits were considerably higher than the year before. Thus, the vice president fails to present a valid argument to justify the proposed cost-cutting measure, and his claim that the employees are satisfied with the current benefits is misleading
The article fails to explain how the employees’ satisfaction with the current benefits was determined. The survey may have asked only a subset of the employees who currently receive benefits, and it is possible that the employees who are dissatisfied with the benefits would not participate in the survey. Furthermore, if the employees who were surveyed felt that they were satisfied with the benefits, then they may simply have stated that they were satisfied with the benefits in an effort to avoid taking further action. Additionally, the fact that the survey indicated that two-thirds of the respondents were satisfied with the benefits indicates that it was flawed, as the responses may have been biased by the respondents’ expectations. The vice president also does not mention any evidence that Panacea is actually losing employees, which could indicate that the employees are not leaving the company because of Panacea’s benefits
The vice president’s argument also fails to consider other alternatives. Nostrum could expand the benefits that it currently offers, or even eliminate the benefits altogether. This would reduce the expenses of the company, which would allow it to increase profits or to reinvest the money in additional research and development. Another option would be to offer better benefits than Panacea does, thus attracting the employees away from Panacea
Another flaw in the vice president’s argument is the assumption that Panacea’s employees are satisfied with their current benefits. If there were dissatisfaction with the benefits, then Panacea would be losing employees to Nostrum. Furthermore, if the employees were dissatisfied with the benefits, then they might leave Panacea and go to Nostrum anyway. If Panacea’s employees were dissatisfied with the benefits, then Nostrum might gain a competitive advantage over Panacea, which could in turn lead to the loss of the employees to Panacea
The article also fails to provide adequate evidence that Panacea is losing employees. The vice president of Nostrum assumes that Panacea is losing employees because of the reduced benefits, but Panacea’s losses could be caused by other factors. For example, Panacea could experience decreased sales if its competitors offer better benefits. If Panacea was losing employees for other reasons, then Nostrum’s cost-cutting measure would not save the company any money
The vice president’s argument is a weak one. Although the vice president is correct that Panacea’s profits are currently lower than last year, the vice president does not present any evidence that Panacea’s profits will be lower in the future. Furthermore, the article offers no evidence that the employees at Panacea are dissatisfied with their current benefits, and the article’s conclusion that Panacea employees would be dissatisfied if Nostrum’s proposed measure was implemented is unsubstantiated. For these reasons, the vice president’s argument is flawed, and his company should not implement the proposed measure.