1990 was a bad year for Barnet Annenberg and his downtown Baltimore graphics company. Sales were in a slump, and clients were going out of business. He overspent on office renovations. He couldn't pay bills on time, and suppliers began to cut him off. His bookkeeper was so harried that she didn't even have time to calculate the extent of the cash hemorrhage.
When the year ended, he was $150,000 in the hole and on the verge of bankruptcy.
Drastic action was needed to save Maran Graphic Specialties Inc., the 63-year-old company Mr. Annenberg's father started. He involved selected employees in the management team, trimmed the staff elsewhere and tightened up on expenses. He even changed his own role.
The result: He closed the books on 1991 with a $60,000 profit on sales of $1.8 million.
To celebrate, he split the earnings evenly with his workers, giving each hourly worker an extra week's pay and each manager $500.