Leaders must challenge operational drivers of marginal and break-even costs. While the industry is well-versed in taking bold action to defer or cut capital projects in response to a lower priced environment, these decisions are often made without focusing on near-term operational efficiency opportunities. Now is the time to optimize processes to yield more productivity and fully realize the benefits of scale and standardization.

Immediate Cost Reduction Strategies:

    • Sourcing opportunities
    • Capital redeployment
    • Process improvement and labor efficiencies
    • Agile economic planning and forecasting capabilities
    • Mobility solutions

In summary, companies should be working to re-evaluate their business models to lower their cost base, develop better capabilities than the competition, and re-structure the supply chain and supplier arrangements to reduce expenses. Through optimizing financial leverage, reshaping the asset portfolio, limiting costs and reducing risks, companies can excel through price trough and position themselves to beat the market when prices rebound.

Or you can plan to invest based upon status quo… expecting the same results – not better.



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