A tropical storm viewed from a weather satellite looks more or less uniform, as if it is affecting every area it touches with equal force. On the ground the picture is different. One home loses its roof while others on the same street come through intact. One community is devastated while its neighbour a kilometre away escapes unscathed.

The same is true of economic downturns. A sharp downturn affects everyone differently. Each company has strengths and vulnerabilities. Each will have different answers to three critical questions: How is the slowdown affecting the industry I compete in? What is my company's strategic position within that industry? And what level of financial resources can my company draw on?

In considering the first question, executives need to know: Will the downturn hurt sales and earnings harder than the overall gross domestic product? Will it force bankruptcies and capacity reductions?

From 1987 to 2007, the United States economy experienced two recessions. The apparel industry weathered negative growth in 13 of those 20 years, petroleum and coal in 10 of the 20. Insurance also suffered 10 years of negative growth, while health care had no down years at all. Recovery times also vary dramatically. Following the 2001 recession, the S&P 500 sub-index for computers bounced back in nine months, while the telecommunications index took almost three years.

We are seeing the same variability today. Though the financial services industry entered a slowdown with the collapse of Lehman Brothers, most health-care industries have continued to grow, though at a slower pace.

Second, how strong is my strategic position? Are we one of the most viable long-term competitors? Will this downturn favour our competitive advantages? Can we gain significant market share?

The returns of market leaders on average are higher and more stable than those of followers. As prices decline in a recession, followers typically see profits turn to losses and may be forced to cut costs. Leaders may record lower returns, but their profitability provides flexibility to maintain spending on research and development, advertising or acquisitions.

And third, what are my financial resources? Are we confident that we can meet our financial obligations and still invest for growth? Will competitors face serious financial challenges long before we do?

Money provides options. As Virgin Group founder Richard Branson recently commented, "There are enormous opportunities in recessions. And we've got financial resources." Virgin, he said, is considering setting up airlines in Brazil and Russia.

Your best strategy in a downturn depends on where you stand on these three dimensions. For example, if your company has a strong financial, strategic and industry position, then your options are more plentiful.

You could out-invest competitors in marketing to increase customer loyalty. You could attack or even acquire weaker competitors; you could price products to gain share. You may be well positioned to dominate critical market niches by concentrating your financial and marketing strength.

If your company has a weaker financial position, you face a different set of possibilities. Depending on your strategic position and your industry's volatility, your best options may be to divest non-core assets and restructure the balance sheet, or speed up decisions on reducing cost and debt.

You may need to seek alliances or merger partners and dispose of anything that is not essential to survive. Or you may choose to reposition your business by selling weak operations and focusing on a sustainable core business.

With the economic storm gaining intensity, companies worldwide naturally feel exposed and vulnerable. By understanding clearly your strengths and weaknesses as a firm and how this downturn will affect them, you can focus your actions on the areas of the business you control.

Darrell Rigby is a partner with Bain & Co in Boston and heads the global retail practice and global innovation practice. Vinit Bhatia is a partner in Hong Kong and Richard Ho is a partner in Shanghai.