Industry Capacity — Matching Marketplace Realities

During good economic times, it's easy to let a little extra overhead creep into one's cost structure with the thought that current momentum will continue. However, when fighting a downturn, it's important to replace addition skills with subtraction.

Don't Drop Prices

When operating in a changing environment, the real challenge is not to reduce the price on a job to get the next order, but to adjust capacity—including overhead—to reflect marketplace reality. This is very painful, especially if we must face our own previously poor decisions. Or, worse yet, good human beings who through no fault of their own just aren't contributing enough to the overall effort because we haven't provided work at which they can be productive.