This memo just went out to employees of B-to-B publisher ALM (formerly Incisive Media), updating them on the year to come. Furloughs are back, but the outlook is slightly less dire than last year. The full memo:

Welcome back. I hope you had an enjoyable break for the holidays and took the time to celebrate with your family and friends.

As we begin the New Year, I thought a few words about what 2010 looks like from my desk and how we'll proceed would be in order. It has been, as you know, a challenging 15 months at ALM and in the media industry since the downfall of Lehman Brothers and the downturn in both the general economy and, particularly, the markets we serve. Nonetheless, through a great deal of sacrifice and creativity, we managed our way through the crisis and remained true to our mission – providing high value content to our sophisticated audiences while finding creative ways to meet the needs of marketers seeking to reach those same audiences. And we did so while maintaining the confidence of our investors and lenders, no small feat in the current financial environment. You have my thanks for all you have done to help us through the storm.

The Road Ahead

Looking ahead, as I mentioned on my blog a few weeks ago, my long-term view of the business is optimistic even though I think the challenges of 2009 will carry through for at least the first half of the new year. I am very confident that our decision to invest in product development opportunities in the research/information services sector as well as the reorganization of our national advertising sales team will leave us poised for success when the economy rebounds. But since we do not expect to see that growth for many months we will need to exercise the same fiscal discipline in 2010 as we did in 2009. That means keeping our expenses low, our spending conservative and our investments focused on areas that will lead to significant revenue growth in the coming years. Unfortunately it also means that we will once again be asking employees to take 5 days of unpaid furlough in 2010. We did not come to this decision lightly but given our short term revenue predictions and the significant savings that the furlough provides we simply can't afford to eliminate it at this time. Or, put another way, we would rather keep a larger staff employed for 51 weeks, than a smaller staff employed for 52 weeks. We think that's a better choice for all of us and for our customers.

This year's furloughs will work much like last year's with many employees taking their days during the last week of the year when much of the Company will be closed. To help answer your furlough questions, the HR Department will be distributing detailed furlough guidelines later today.

Our hope is that by aggressively managing our expenses through furloughs and the other initiatives mentioned below we will be able to avoid the type of large scale lay-offs we experienced last year.

Compensation Adjustments

The good news is that we have designated a portion of this year's budget for potential mid-year compensation adjustments. But utilization of those funds is contingent on meeting our financial targets for the first half of the year. If approved, I would assume that increases will primarily be given on a merit basis or where market conditions absolutely require salary adjustments. I will have a better sense of how this process will work as the summer approaches and will update you at that time.

Voluntary Unpaid Vacation and Reduced Work Week

In 2010 we will continue allowing employees, on a voluntary basis and with management approval, to take up to one week of additional unpaid vacation time and/or to request a reduced work week schedule. Unlike the furlough which employees must take, the additional unpaid vacation and reduced work week programs are completely voluntary. The Human Resources Department will be distributing detailed guidelines about these programs later today.

No Vacation Carry-Over

As we did in 2009 and per our Vacation Policy, employees must use all of their vacation days in the year in which they are earned.

Travel and Entertainment

We will continue with the guidelines developed last year for all travel and entertainment expenses.

Tuition Assistance

The Tuition Assistance Program which was temporarily suspended in 2009 will be re-implemented in the second half of 2010. Employees who are interested in participating in the program should refer to the Educational Assistance Policy in the Policies and Guidelines section of InHouse.

Bonuses

We are working with our Board of Directors to create a bonus pool for over-budget performance by the company as a whole (somewhat akin to a profit-sharing plan). Our intent would be to use that pool to provide merit bonuses at year-end for both staff and management.

401K Plan

With respect to our US employees, we are not planning to make any changes to our 401K plan in 2010 which means we will continue providing participants an employer match of 25% of the first 4% of contributions. US employees who are not yet enrolled in the 401k should consider doing so at this time. We are also pleased to announce that beginning this year employees in Canada will be eligible for Company RRSP contributions. Additional details about these contributions will be sent to employees shortly. Staff members in the U.K. and Hong Kong are covered by local benefits plans, which will be addressed separately as appropriate.

If you have any questions about these programs please contact [redacted].

Once again, thank you for all you have done over the past year for ALM and its customers.

Regards,

Bill