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Paolo Rocca

What is your approach to cutting costs in this economic environment?

Paolo Rocca, chairman and CEO of energy-industry supplier Tenaris SA (TS), believes oil and gas will remain crucial to the global energy matrix in the long term. But first there is the present situation to get through. Because of recent lower demand for the specialty pipes that Tenaris produces for oil and gas companies, the company has moved quickly to reduce working capital and fixed expenses. “Being close to our customers has been crucial to align production to the new market conditions, thus also reducing inventories,” Rocca says.

“After our strong expansion in the past few years, this is an opportunity to regroup and strengthen our focus on improving the service we provide our customers worldwide.”

And while the downturn has forced the company, which reported 2008 revenues of $12 billion, to further cut discretionary spending and conserve cash, says Rocca, minimizing the impact on employees is a must. In the wake of recent layoffs, Rocca says he’s been “impressed with the maturity and sense of responsibility with which our employees have responded to proposals for voluntary work-sharing measures.” Tenaris is also using government-sponsored employment support programs where available, he says. A more proactive approach that should better position the company, Rocca says, is redeploying and retraining staff to speed up promising projects that will drive growth in the years ahead. “After our strong expansion in the past few years,” Rocca says, “this is an opportunity to regroup and strengthen our focus on improving the service we provide our customers worldwide.”