Managing in a Recession

“When we started Triad, we were focusing on the high-tech industry, and shortly thereafter was the dot-com bust,” remembers President Jennifer Arends. “The following year was 9/11, which was challenging for everyone, but especially for those in the travel and hospitality industry who have air travel as large portions of their programs. We are approaching this recession similarly to how we approached the [2000-2001] challenges—by offering a strong partnership, strategic value, and a can-do attitude. Our clients knew then, and know now, that they can count on us when the chips are down.”

Experienced executives know that external factors are only part of the equation. To some extent, a company’s success or failure during a recession is always determined by management decisions.

That’s why Janssen sought help from a seasoned businessperson after her negative experience. “I was smart enough to hire Rich Woodward as my partner,” she says. “His savvy has really made the biggest difference in why we’re able to not only survive, but thrive, in 2008 and 2009.”

Not every company will choose to bring new blood on board, but all will make crucial decisions in operations, human resources, and marketing. Those management choices have the potential to buoy the company despite rough times.

Show Us the Money

• Smart banking, intelligent inventory, and lean practices.

One of the first areas that got Woodward’s attention was Maxxum’s relationship with its bankers. “We have two primary banking relationships, and we’re committed to communicating openly and candidly with them on a regular basis,” he says. “Certainly we’re sharing some of the success stories we’ve had, but also any hiccups along the way. They know exactly where we are, and they’ve been very supportive and talked about what they can do for us, rather than what they can’t do.” So far, the open channels of communication have kept the relationship positive instead of adversarial, and the company hasn’t had to go elsewhere to try to get additional funding.

Janssen contrasts this approach with her old modus operandi. “One of the things Rich has brought to Maxxum’s culture is being proactive,” she says. “We’re proactively communicating with our bank. We’re proactively communicating with our vendors and customers and staff.”

The same has held true for Minneapolis audio-visual and signage firm Tierney Brothers. Owner Tom Tierney says that the most important thing is keeping the bank up-to-date on the company’s status and strategies.

“We have a credit line, obviously, and they’re very concerned [about the potential effects of the downturn],” he says. “We’ve been banking with them for about five years, and we have a good relationship. At this point there aren’t any issues, but you never know—at a time like this, you could need additional funds.”