Costs were only lowered temporarily, and efficiency wasn't necessarily improved. The only true route to lasting efficiency is the intelligent redesign of operational processes, combined with the savvy application of technologies, especially the Internet. The objective will be to redesign your processes to achieve new levels of efficiency, but recognize that you won't be alone in your industry in doing this. There are likely to be other low-cost producers. Consider the steel industry.
Steel companies work to be low-cost producers and regularly beat up one another over prices.
But service is still important, and the order generally goes to the company that has the best price and can dependably deliver. Similarly, I still believe that price alone won't secure your company's competitive position. You must also use IT to change customer experiences and innovate. But to change a customer's experience or improve your company's ability to innovate requires going deeper into the psyche - both yours and that of your customer. It's more intellectually challenging work than just improving efficiency.