Managing in a Recession

“Can I say it’s because of that?” asks President Tom Trutna. “Not unequivocally. But we’ve really helped the bottom line by just being more efficient with energy resources.”

The company’s newfound leanness and greenness is helpful from a marketing standpoint, too, he says. “Sustainability has been a real point of differentiation. I believe it has played a part in our increase in sales. We’re holding the line on profitability when, I think, a lot of other companies like ours are suffering right now.”

Woodward says a similarly lean culture is the norm at Maxxum. “We’ve tried to take a look at everything and question ourselves as to why we’re doing it,” he says. “If it doesn’t bring us additional clients and it doesn’t serve our current clients better, then we are not going to do it. This culture took probably about a year and a half to create.”

“We cut back anywhere and everywhere,” agrees William Dworsky, president of Consolidated Container Company, a container reconditioner and recycler in Minneapolis. “That was the basis of our management technique even before the recession. Companies should always be vigilant with expense controls, especially in good times, because they won’t have to make as many adjustments during down cycles such as these. Any smart businessperson knows there are cyclical economic periods.”

But even the leanest company may have to make some extraordinary cuts right now, if it happens to be in the wrong industry. Major purchases may have to be postponed. At the end of 2008, Leonard sliced $700 out of Chocolat Celeste’s monthly budget by giving up the lease on a separate event space in her building.

Meanwhile, Triad has reluctantly decreed that although it values employee training highly, most such training must take place at local seminars and conferences, or via webinars.

Tom Trutna writes a purchase plan for Big Ink every year, listing the equipment that should be upgraded or replaced. But this year the budget for equipment was cut in half: they bought a flatbed cutter, but not the new printer they needed.

“That was directly related to ‘Let’s just wait out this economy and see what happens,’ ” he says. “We also had a meeting in December where I laid it out to everybody. I said, ‘Look, this is not looking good, and it doesn’t look like it’s going to change anytime soon. We need all hands on deck right now to look at every way we spend money and make sure we are doing it in the most efficient way possible.’ ”

A Team Effort

• Work force maximization and the need for transparency.

The words “all hands on deck” may seem like strange ones at a time like this. After all, wages are a major expense, and for many companies, there’s a lot less work to do. But in companies with a strong culture of cooperation, employees are active participants in the effort to make the company more efficient.