While health care is among the more recession-proof industries, people under financial hardship may postpone medical procedures that aren't absolutely necessary, and it may be difficult to collect payments from those who do seek care. So the not-for-profit clinic has been imposing budget reductions, says Erich Heneke, supervisor of supply-chain audit controls.

That poses a problem for Heneke's group, which is responsible for getting products in the door and paying for them. By far, salaries are Mayo's largest expense. But reducing head count has a documentable impact on, for example, the number of invoices processed per month and how many calls customer service can take per day. So the supply-chain organization, normally viewed strictly as a cost center, is developing an unusual strategy to turn itself into a revenue generator.

The idea is to market Heneke's group's services — accounts payable, purchasing, contracting, logistics, etc. — to other health-care organizations. Because of its transaction volume and strong technology, it could reduce costs for such customers, Heneke claims. None of these arrangements have been struck yet, but over the past year the group has begun providing services for other organizations within Mayo.

Marketing efforts likely would start with a consortium of Midwest health-care providers that Mayo belongs to and that already share pricing information and do some joint contracting. "We'll say, 'Here's our cost to process an invoice. What's yours?' These costs are dragging them down, and if we can do things more cheaply, we both benefit," says Heneke.

Popular Cuts
Meanwhile, some types of expense savings — aside from well-known ones such as layoffs, hiring freezes, and benefits reductions — are emerging as trends among smaller companies, according to Angela Roberts, area practice director for Ajilon Finance Solutions.

A number of Ajilon clients have turned to videoconferencing in lieu of physical travel for such purposes as board meetings and business pitches. Long on the horizon as a promising cost-saving development, the technology finally seems to be finding some widespread footing. And the more companies that have videoconferencing, the more useful it becomes to others that have it.

Installing videoconferencing equipment brings not only immediate savings but also expense reductions that will last, Roberts points out. "Whenever you use it, you'll be saving not only on travel costs but on time away from the office," she says.

An even lower-cost alternative to travel — in fact, a free one — is the use of Internet communication vehicles such as Skype. Roberts says that she and some of her clients are using freeconferencecall.com for audio interaction without the need to install camera equipment. For their part, Skype users can see one another by using cameras mounted on their computers.

Another widespread practice is a switch to electronic documents, saving on paper and printer cartridges. Even documents that require signatures, like invoices and purchase orders, now often use electronic signature stamps. All kinds of communications — to employees, customers, and shareholders — are going electronic. "It's a good 'green' idea, but I think it stemmed from a cost-cutting motivation," says Roberts.

And many owners of Ajilon's small-business clients are forgoing the salaries they historically have paid to themselves, instead just waiting for year-end returns on their investments in their companies. Indeed, in a survey released in April by American Express, 30% of 727 small-business owners said they have taken that step.

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