Dates, gates and targets: the zero-defect start-up
"Just like we were in recession before we noticed it. However, in areas where capacity has been particularly cut, there is a real possibility that an upturn in demand will create a significant upturn in pricing, and pressure on capacity. But I think that will be the exception. In general, I think it will happen very, very gradually."
Meanwhile, every player has the difficult task of trimming their business to suit an unpredictable climate. Patullo says there is a limit to the amount of rightsizing a company should do.
"As a company, we are trying to stay in balance, so we need a good cost reduction programme; to continue to focus on growth to offset the revenues from existing customers; and to keep focusing on capability and improving our systems, training and product performance.
" If we do all that, we will be in a good position when the recovery comes. If all you do is cut costs, it will doubtless help you to survive now, but when there is any upturn you are going to be scrambling for capability and to recover ground lost with customers.
"Our business model last year was to grow; now it is to sustain."
Cutting heads
Nevertheless, Ceva has also had its share of having to hand out the bad news.
"Cutting heads is the last resort, but we have had to do it. We have tried to protect our sales and operations and customer service areas and focus on the general overheads area, where we have cut by 1015%. That would be in the order of about 500 people.
"In the other areas, it has been modest - low single-digit as a percentage. That is in part because we have been able to cushion ourselves by the elimination of temporary workers, and in part because we have done better than the market."
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