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Even far from New York and Washington, the world of work remains anything but normal. Layoffs abound. That project to reinvent the company that made the IT job such an adventure last year? Gone. Top that off with a nagging feeling that saving money through better database management is, well, kind of pointless when the world's facing terrorism and bombing raids, and you've got a discouraging work environment the likes of which we haven't seen in at least a decade.

IT leaders are countering all that with a determination to regain the energy and momentum that put IT at the center of many companies' business strategies just a year ago. Specialized Bicycles Inc. is 3,000 miles from New York, but the Morgan Hill, Calif., bikemaker is dealing with its own swirl of bad economics and raw emotions. It laid off 30% of its IT staff, profit-sharing checks have dried up, and the IT budget's tight. Yet Ron Pollard, CIO and E-commerce president, and his IT team are finding ways to energize their jobs despite the malaise that surrounds them. They're focused on taking small steps that will make the company stronger.

An example: Part of Specialized Bicycles' Web site was split between a self-hosted E-commerce application using Oracle Applications 3i and an informational site hosted by UUnet Technologies. Specialized's IT team is moving both parts to a site that will run on Oracle Applications 11i, saving an estimated $1 million a year. The IT team is planning other projects to cut operating costs by another $7 million.

But what of those doubts raised in recent weeks, as the loss of lives leave us questioning the significance of routine tasks? Specialized has responded by focusing more closely on tasks at hand. At a company where a passion for cycling is one of the job requirements and where riding is considered a fundamental personal freedom, the IT staff gets a lift from knowing exactly how the work they do helps keep bikes rolling off the production lines. "We're doing projects that help the bottom line," Pollard says. "The staff knows that there's cutbacks, and they look to management and ask if they're prioritized right."

Nothing can compare with the personal trauma felt by those in and around the World Trade Center and the Pentagon. But some companies, such as airlines, are having to bolster employees spirits against a financial storm as bad as anything their industries have ever seen.

Continental Airlines Inc. had been flying high this year, making money even in a down economy that was crimping many rivals. After the shutdowns and travel slump, the Houston company looked like every other carrier. Less than a week after Sept. 11, Continental said it was laying off 20% of its workforce-12,000 people, although it later said it expected to avert 1,000 of those layoffs through a voluntary leave of absence plan. CIO and senior VP Janet Wejman did her part, cutting of one-fifth of the IT organization.

Instead of cutting the cool projects, however, Wejman's team found itself with more excitement than it wanted. They had to hone new applications under intense pressure that let Continental create and roll out a new, truncated schedule. The team added new security measures, which Wejman declined to spell out, to the company's curbside check-in application so that service could be resumed. And it revamped Continental's Web site so E-ticket customers receive the printed itinerary information they need to get through security checkpoints. "We're engaging them to help the business through the storm," Wejman says of the IT staff. "All of their creative juices have come out as they're trying to solve problems."

That got Continental's planes back in the air after the crisis, and now Wejman faces a challenge more typical of what other companies around the country are dealing with. She needs to keep the remaining staff focused so they don't dwell on their friends and colleagues who were laid off but instead get Continental back to where it was on Sept. 10. She puts the mission plainly to her staff: "What you can do to get those people back?"

Sept. 11 certainly called the importance of work into question, at least temporarily-some IT employees felt that their work was insignificant and meaningless in comparison to the scale of the tragedy. Building an E-commerce application doesn't seem to matter as much when thousands of people have died, and a nation readies itself for war. IT executives say there's no easy way to respond to this, but it helps to talk about the value of the work the company does and IT's role in making that happen.

Continental focused on quickly returning to the skies and helping to get the nation moving again. At Allstate Insurance Co. in Northbrook, Ill., employees began doing their part to restore order and property to customers hit by the attacks, as well as getting their own New York office, based in the World Trade Center, up and running again.

While many people take comfort in the get-back-to-work approach, managers have found they also need to set aside time just to talk with their staff about how they're feeling. Compaq CEO Michael Capellas has been meeting with groups of several hundred employees at a time, meetings that were set up to discuss the details of the company's proposed merger with Hewlett-Packard. Since Sept. 11, the talks have often veered far off course, as people aired feelings about the attacks and the economic uncertainty they've fueled. Capellas doesn't worry too much about keeping the groups focused on discussing the merger; he considers it a critical time to make this kind of personal connection with employees.

"For all the wrong reasons, there's been the opportunity to emotionally connect with people, because they have such strong feelings on a number of fronts," Capellas says. "It's a particularly confusing time, emotionally. It's a great time to do personal communication."

But what happens when the adrenaline of the immediate crisis passes, people find themselves talked out, and IT teams realize that all the exciting projects are on the shelf? information Research's third-quarter Priorities survey of IT spending found that more than a third of companies have stopped or suspended IT projects. Seeing cutting-edge E-commerce and other application deployments on hold chips away at morale.

"Businesses aren't growing, so they're not pushing through new projects," says Tahl Milburn, director of technology strategy for credit-card company Providian Financial Corp. "We don't see as much buoyancy in the way teams work as we would in a high-growth market. People tend to be less enthusiastic."

Milburn is trying to emphasize the opportunity a temporary downturn presents-time for training, tuning up legacy applications, or exploring new data-mining possibilities. They're the kind of things no one has time for when the market's booming. "Regardless of the situation, you have to be able to exploit what's unique about it," he says.

As a credit-card company, Providian has been hit hard by the economic downturn. Earlier this month, the San Francisco company said quarterly earnings would come in about four times less than the original forecast, in large part because of a rising number of people who can't pay their balances, forcing an $85-million write off of uncollectible interest and another $186 million in provisions against bad loans. The company hopes more detailed historical analysis based on information in its data warehouses will help it better anticipate when customers are at risk of running short of funds, and let it offer remedies that help those customers stay afloat.

Providian still has some intriguing projects in the pipeline, such as rolling out the Web-based PeopleSoft 8, which will give employees more direct access to information about benefits and other human resources issues. But looking a little farther out, employees admit that the future doesn't look as interesting. "It's not like we're bored," says Doug McCurdy, a Providian systems architect. "The question is, 'How fancy are the new projects going to be?'"

Most important for Providian is a project that's definitely not fancy: updating its legacy systems. The first-generation client-server systems have struggled to keep up with the company's growth, and Providian let updates slide when business was booming. Providian is adding new, largely internally developed applications with special attention paid to system availability, a project that Milburn anticipates will take 14 to 16 months. It's also working to bolster its data warehouses.

This kind of update work is vital, but it's not the sort of thing that gets IT pros jumping out of bed in the morning. "As technologists, they don't like it, and they're griping," says Sybil Gurney, Providian's manager of corporate business applications. So how does management deal with keeping bright minds engaged while doing routine work? Providian has come up with a rotation policy so that people working in the legacy systems group can spend time on new projects as they become available, learning new skills alongside the application development group.

There are other incentives as well. Providian didn't pass some of its recent internal, business-process audits that assess how well the IT systems and the department are performing. The department has turned that problem into a challenge that includes upgrading existing systems, which has raised the importance of that work to the business. McCurdy says he doesn't turn up his nose at that kind of work, since dealing with older technology has its own complexities and brings its own rewards. "I take delight in fixing things to be as good as they could be," he says.

Milburn also is using the breathing room provided by a lighter workload to encourage collaboration that might not happen in a faster-paced environment. He's trying to get IT staffers to team with business users as well as other technology people to flush out answers to problems and dream up fresh project ideas. That way, the company will be better prepared when IT spending revives and it starts new projects.

Managers such as Milburn are replacing money with time. Training is one example. Milburn doesn't have more money to train staff, but he wants to use this bit of slack in staffers' schedules to increase skills and keep talented people motivated. Providian believes in cross-training employees, so Web designers can add Java application skills, or network managers can spend time in the data center. "They feel that they have additional value in case things do pick up," Milburn says. Instead of formal training-which would mean paying cash for a trainer-the company has people informally shadow colleagues in other departments and team with them on different projects.

Georgine Young, a consultant with staffing company Hewitt & Associates, recommends that IT organizations use the slowdown to focus on better planning. One of Young's clients deferred an IT project, but instead of simply shelving it, the company had its employees set aside time each Friday to think about and discuss it, she says. The move has fostered a think-tank atmosphere, which helps workers continue looking ahead. IT departments can spend downtime checking out vendors to use for future projects. And companies that are still spending money will find a good negotiating environment these days.

The time-for-money strategy is in widespread use. Zeke Duge, CIO of Smart & Final Inc., a Commerce, Calif., discount retailer, decided not to outsource its next deployment of retail equipment to new stores. Instead, it's handling the deployment internally, even though that means more time and travel for its staff. Eliminating consultants cuts costs, but also gives internal employees a challenging workload over a longer period of time.

Specialized Bicycles took the same approach with its Oracle 11i deployment. Without hired consultants, the deployment took longer, but the five-month project was considerably cheaper, and the company developed in-house application skills it didn't previously have.

Managers also are emphasizing the service role IT can have throughout the company during slow times. Specialized Bicycles' Pollard says that recent projects to improve sales systems, such as an application that lets salespeople immediately access the availability and pricing of goods, has made the lives of its 120-person sales force easier-not to mention making their days more productive. Duge at Smart & Final focuses more than usual on small quality-of-life issues brought up by individual departments-an improved ledger function for the accounting department or better scanners for store clerks. "I focus on the small wins and place an emphasis on the tactical things that normally get swept under the carpet," he says. "We want to make sure everyone thinks IT cares about them." Smart & Final hasn't stopped strategic projects completely, but the company tries to do interesting things that cost less.

Finding ways to energize and motivate employees pays off in better productivity and a pleasant work environment in an unpleasant moment in time. It's also critical to preparing for the months-or a year or more-from now when the economy picks up again.

The concern isn't really that dissatisfied employees will stream out the door. "People don't feel as if they have any choices," Providian's Milburn says.

When the economy does pick up, however, an employee who's felt underutilized is likely to bolt to a more favorable environment. "The first thing that happens when the economy turns around is people leave, because they're sick of where they've been," says Victor Janulaitis, principal of Janco & Associates, an IT staffing firm.

Huntington National Bank, a Columbus, Ohio, bank that serves eight states, has faced the question of how to keep the best employees despite struggling financially in recent years. As part of the company's turnaround, CIO Joe Gottron says he's trying to energize his IT group and improve its connections to the business by rewarding "everyday heroics." He makes a point out of celebrating project milestones such as a server consolidation that will ultimately save the company $1 million.

Huntington's watching costs as part of its economic turnaround, but Gottron says financial levers such as stock options, bonuses, and promotions to acknowledge select IT workers are still critical motivators. He's also started a program called the Service Excellence Club, which singles out 50 IT staffers a year from roughly 2,000 and treats them to a formal dinner and ceremony. "We're trying to develop a culture of making sure that the people who really have the passion, desire, and commitment know they're trusted," Gottron says. It also sends a message to those not recognized that they need to step up performance.

It's all part of strengthening an employee's bonds with a company. These are rotten days in a lot of ways, but business leaders who energize and motivate their staffs may find they've built a bond strong enough to last when the good times return.