A simulation study was conducted by Montana State Univ. to compare two different management strategies during drought in the Northern Plains: 1) Early management (EM) in which drought was detected by July 15 and calves were weaned early at 90 days of age and fed in drylot for the remainder of the season; 2) Normal management (NM) in which there were no “early” management changes to emerging drought, but nutrition was modified as needed to maintain animal performance. Both strategies were compared under two drought intensities (moderate, 20% reduction in forage vs. severe, 40% reduction in forage). The two drought management strategies were compared to a base strategy in which climatic conditions were considered average. Economic comparisons were made on the basis of cumulative gross margin (gross margin—variable costs + revenue from drylot calves [CGM]). During moderate drought, CGM was reduced by 17.6% and 33.6% for EM and NM, respectively. During severe drought, CGM was reduced by 48.8% and 72.3% for EM and NM, respectively. For both levels of drought, EM had significantly lower feed costs and higher CGM than NM. Under the conditions of this study, feeding EM calves proved more efficient than feeding NM cows to produce milk to maintain calf performance (Kruse et al. 2003. J. Anim. Sci. 81 [Suppl. 1]: 20.