The following appeared in a memo from a vice president of a large, highly diversified company.

“Ten years ago our company had two new regional office buildings built in two different regions. The buildings were erected by two different construction companies – Alpha and Zeta. Even though the two buildings had virtually identical floor plans, the building constructed by Zeta cost 30 percent more to build, and its expenses for maintenance last year were twice those of the building constructed by Alpha. Furthermore, the energy consumption of the Zeta building has been higher than that of the Alpha building every year since its construction. Such data, plus the fact that Alpha has a stable workforce with little employee turnover, indicate that we should use Alpha Construction Company, rather than Zeta, for all future building projects.”

In his memo the vice president suggests that they should employ Alpha Construction Company in place of Zeta for all future projects. He comes to this conclusion by comparing the two companies after which he says that Zeta has proved to be more expensive than Alpha. Moreover, according to him Alpha has a stable workforce as well. However, the vice president does not make use of good sense and logic in coming to this conclusion. In order to decide which company is better he needs to make a proper survey of their works.

First of all, the vice president cites that the two buildings erected by these construction companies ten years ago were is different regions. It is possible that in the present times, the cost of construction has undergone a change. Consequently, it is likely that Zeta is no more as expensive as it was ten years ago. Moreover, since they were constructed in different places, the vice president should not expect the same durability of the two buildings. In a span of ten years, there could be many changes in a place, which would have an effect over the buildings constructed over it. It is possible that the building constructed by Zeta construction company has seen many adverse weather changes and natural calamities than the building constructed by Alpha. It is evident that there would be more wear and tear of the building that is exposed more to rains, snow, hail, storms and earthquakes etc. The condition of a building after ten years should not be a standard to measure the quality of the construction company.

If the building constructed by Zeta costs 30 percent more than that constructed by Alpha, it does not indicate that Zeta is more expensive than Alpha. The cost of constructing the building could have risen due to other factors like the cost of brick and cement at that place. Moreover, the cost of a building also depends upon the quality of material used in the building. It is likely that Zeta Construction Company has installed the best material and has given high quality interiors to the building. Therefore, even if the basic floor plan is the same, it is the kind of material used that can make the cost of construction of one building higher than that of the other.

The vice president gives the account of cost of maintenance of only the past one year. Firstly, it is possible that in the previous years the building constructed by Zeta has not demanded a high maintenance cost. Moreover, it is likely that the building constructed by Alpha constructors has been renovated a few years back and all the damaged parts have been replaced. Therefore, their maintenance cost has gone down as compared to the other buildings’.

Similarly, the energy consumption of one building is different from that of another building. It is possible that the energy consumption of the building constructed by Zeta is more due to longer working hours. Moreover, it is also possible that the people using the building have been careless in consuming energy, which has resulted in more energy consumption.

If Alpha Construction Company has a stable workforce, it does not mean that Zeta would not have a stable workforce. Further, the argument only concentrates on these two construction companies. There could be other construction companies, which could be better and less expensive than these companies. Moreover, it is likely that many more good construction companies come up in future. Therefore, the vice-president should not make a decision in haste, but should conduct a proper study of all the companies before deciding which one could be the best in future.