At the last presentation at the NRF convention, Mindy Grossman, CEO of HSN, and Jon Luther, executive chairman of Dunkin' Brands, discussed the importance of building morale and maintaining a company's culture when managing the current downturn.

In the session entitled "How Leadership Triumphs Hardship," the executives pointed to a few other keys to managing difficult times, referencing learnings from the recent downturn. These included preserving cash, continuing to invest in the customer experience and innovation, and not straying from what had made a business successful.

"Headwinds only slow you down," said Mr. Luther. "They never prevent you from getting to your destination."

But much of the discussion focused on managing employees' concerns and keeping them focused on long-term goals.

"[Employees] were fearful about what was going to happen so we had to be very clear to articulate what we were doing and why we felt we were going to come out of this," said Ms. Grossman.

HSN stepped up its communications to include town hall meetings every six weeks, constant web updates, and "very visible" management. Ms. Grossman said the company's recent success reflects its ability to be honest and engage employees early in the downturn.

''We had to make difficult decisions," said Grossman. "We had to freeze merit pay and redeploy people but we explained why. If we were still going to invest, we explained why we were going to do that and why we were making the choices we were making. And I think that it's critical. They may not like the decision that you're going to have to make but they understand that it's in the best interest of the company."

Similarly, at Dunkin' Brands, the challenge was to reassure its franchisees at Baskin Robbins and Dunkin' Donuts, many of which "have almost their entire net worth invested in your brand," according to Mr. Luther.

While the parent looked into ways to improve margins for franchisees, it also pushed to deepen communications.

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