Every indication is that the current recession is going to be a tough one. Is it time to put your company's growth strategies on hold?

We put that question to three business leaders who, as facilitators for the Women Presidents’ Organization, moderate local peer advisory groups comprising women presidents of multimillion dollar enterprises. Their answer was a resounding, “No.”

“To some extent, this is a once-in-a-lifetime opportunity,” says Sherry Harsch-Porter, a St. Louis facilitator and owner of executive coaching firm The Porter Bay Group. “My clients see this as a chance to test themselves and grow as business leaders. I encourage them to think of this as an accelerated learning laboratory.”

That attitude is more than just Pollyanna optimism. It is a strategic decision to seize the opportunities that arise from a downturn to emerge stronger and better positioned to thrive.

“We went through something even worse right after 9/11, when we lost two-thirds of our business,” says Yvonne Campos, a Pittsburgh-based market research consultant. “You learn to be proactive and to focus on being smarter. It’s almost a given that in a good business climate you’re not as smart as you could be.”

One important lesson: Don’t wait to make tough choices. “My first time around, I kept trying to hold on before making any changes,” says Campos. “Now I know that you have to react much more quickly.”

Sales: Getting Your Fair Share

Downturns can be a great time to win new business from competitors who are cutting service or who can’t compete on price. But resist the temptation to accept all business that comes along. Instead, know who your ideal customers are and concentrate on keeping them—as well as finding more like them. “I focus my clients on targeted growth,” says Harsch-Porter. “Analyze your customers to see if you fit the typical 80/20 rule [20 percent of customers deliver 80 percent of revenue]. This is the perfect time to eliminate unprofitable business.”

Campos is also seeing companies grow through strategic partnering. “During one of our chapter meetings, we looked at how we can help each other with contacts and opportunities,” she says. “We’re not normally focused on networking, but there are strategic ways that members might be able to share clients to add value.”

“People in high-end service businesses have been hit hard and tend to be talking about creative solutions,” adds Laura Schacht, the owner of St. Louis communications and graphic design consultancy Echo Media. “For example, partnering with a friendly competitor to take on projects they wouldn’t be able to handle alone.”

Marketing: Focus Pocus

Marketing expenses are often among the first cuts during a recession, but experts caution against slashing these budgets. “A lot of companies will make knee-jerk cuts in marketing, essentially ‘going dark’ to ride out the downturn,” says Schacht. “What they’ve actually done is pave the way for smarter companies to become more visible.”

Harsch-Porter favors cost-effective, focused efforts over mass marketing to keep yourself in front of your best clients even if they’re cutting back. “A number of my larger clients have totally eliminated consulting and coaching budgets for the next few quarters, so I’m looking at ways to leverage technology that will provide them value and allow us to stay connected,” she says. These include “e-briefs” highlighting management principles, a blog and a password-protected webpage containing white papers, resources and exercises for clients.

Campos adds that it is crucial to understand how the economy is impacting customers’ decision making. “Understand and engage with that customer better than your competitors,” she says. “Everyone is tying messaging to value, but you need to understand how exactly the customer defines value.”

Cutting Costs: Scalpel vs. Axe

“What I’m hearing is that everyone is looking at all aspects of their organization and being much more efficient,” says Campos. “But making smart cost-cutting decisions is what saves you. At some point, cutting costs can go too far and you can’t get the work done.”

The key to effective cost cutting is careful planning before you need to make any cuts, adds Harsch-Porter. “I highly recommend scenario planning: Consider three to five scenarios that are triggered by certain key indicators you watch. That way you have an action plan ready to go the moment you see those indicators changing. The point is to make a plan before you need it, when you’re not in the thick of things and can think strategically.”

Schacht suggests leveraging vendors’ willingness to negotiate on price to save money. And she points out that, with interest rates down, it’s a good time to consider restructuring your company’s debt.

Of course, the most difficult decisions involve staff cuts. “Small organizations by their nature have fewer employees who often manage more than one function, so eliminating even a single person can leave a huge hole,” says Harsch-Porter.

If a reduction is in order, the consensus is to cut once, as deeply as needed. “Few things get in the way of productivity as much as the fear of repeated cuts and waiting for the next axe to fall,” says Harsch-Porter.

“You should go overboard with internal communication,” Campos adds. “You have to get employees to understand that you’re making the company stronger together.” Successful communication means treating employees as partners, which opens avenues to shared sacrifices such as reduced hours, job-sharing or salary reduction, as long as you make sacrifices as well.

The Last Word: Keep It Positive

“Psychological research shows that resilience and innovation are diminished by negativity—which, unfortunately, is stronger than positivity by a wide margin. You have to be intentional about creating positivity to overcome the tsunami of negativity in the environment,” says Harsch-Porter. “For some leaders, it’s listening to certain kinds of music or taking a particularly beautiful route to work. For others, it’s taking a few moments in the evening to write your accomplishments of the day, to see that you have achieved things and pressed forward.”

Whatever your approach, remember that your goal shouldn’t be to simply survive the tough times: It should be to thrive.

>> For more information about maintaining financial stability, reach out to your WBA or visit NationalCity.com/women to explore additional resources. Learn more about peer-to-peer advisory groups at womenpresidentsorg.com.