Article at a glance:

Preparing for a slump in earnings

• Conflicting economic indicators have executives watching the markets cautiously. Even as some sectors appear to be slowing, many executives hope that their companies can hold on to the all-time-high corporate earnings levels of 2007.
• Few executives, however, are making the kind of radical contingency plans that would be necessary should earnings fall back to—let alone below—their long-term average.
• Boards and executives shouldn't postpone planning for a downturn—including efforts to seize the competitive opportunities that a slump might unearth.