BUSINESS ENVIRONMENT AND KEY CHALLENGES

Today companies throughout the country expect continuing declines in revenue and profit as their markets shrink, selling prices fall and productive capacity goes unused.  They also expect the recovery, when it comes, will be one of slow growth for several years.

To achieve revenue and profit growth in a slow growth economy the challenges are:

1.   Capture a larger share of smaller markets 

a.    The low cost producer always has an advantage

b.    Enhance customer intimacy

2.   Reduce costs to allow price reductions and still be profitable

3.   Use cost savings to invest in improving customer value drivers

4.   Reduce unit costs to be profitable at lower revenue and production levels

SURVEY QUESTIONS

          We are currently cutting costs of purchased materials by

o   reducing unit costs:

o   reducing amounts used:

          We are currently cutting costs of purchased services by

o   reducing rates paid:

o   using less:

          We are currently cutting personnel costs by

o   reducing people and benefits

o   improving employee productivity:

We are currently cutting equipment costs by

o   reducing acquisition costs:

o   using equipment more efficiently:

          We are currently cutting facilities costs by

o   reducing acquisition costs:

o   more efficient use:

          We are currently cutting inventory costs by

o   changing business factors that determine amounts of inventory:

o   reducing or eliminating our problems that cause excess inventory: