Evolution anyone? Who has heard of an organism adapting to change by cutting their limbs off?

People like stability. In fact, we are predisposed (through evolution) to think that the world is inherently stable. They think that if something has been working for 10, 20, 30 years there is no reason that it should not keep working; thus, a downturn in their business is a temporary abnormality that will correct itself. Sometimes this is true, usually, it is not.

Often, with new technology (internet) and markets (china), costs get demolished. A business that relied on the previous cost-price ratio simply cannot compete.

Things change - usually for the better - and companies who fail to adapt, die. Their failure to recognize genuine change is their own failure and no amount of cost cutting will change an organization for the better.