Jon Vrabely finds managing a business during a recession to be a lot like being trapped in an elevator that is in free fall and not knowing what floor you were on when the fall began.
“You don’t know whether you’re on the 90th floor or the ninth floor heading down,” says Vrabely, president and CEO at Huttig Building Products Inc. “So the biggest challenge is not really knowing where the bottom is.”
Vrabely thought his millwork and building products distribution company had found the bottom in mid-2007. Housing starts had fallen to the level his team had predicted and the market appeared to be stabilizing.
Unfortunately, it was just pausing before an even more severe dive. Instead of bouncing back, the housing market only got worse in the second half of 2007 and still has yet to recover, putting Vrabely and his company in a precarious state. Revenue fell from $875 million in 2007 to $671 million in 2008.
“It’s a very delicate balancing act to ensure survivability while keeping an eye on the future,” Vrabely says. “You’re trying to maintain a strategic view of the future, but you are challenged with immediate needs that need to be addressed from a financial and cost perspective.”
So what’s a leader to do? How do you keep 1,200 employees from being distracted about the potential loss of their jobs and focused on the work they were hired to do while you try to save the company?
The biggest mistake you can make is to hide in your office and say nothing. You need to lay out the facts as you see them and give your employees a sense of what is happening with the business.
“At the end of the day, I always try to communicate to our employees that not everyone will agree with the decisions that we make,” Vrabely says. “But my hope is that they at least understand why we are making those decisions as well as the impact those decisions will have on our business. Ultimately, all of our goals collectively should be to ensure that we survive this market downturn.”
Here are some of the techniques Vrabely has used to give his company hope for the future.
