When Susan Krane took the reins of the San Jose Museum of Art in 2008, the economy was melting down, and arts groups were drowning in red ink. But Krane, bolstered by an MBA as well as an artistic eye, has a pragmatic vantage point on tough times. She didn’t skip a beat.

“I have a bad habit of starting new jobs just as drastic things happen in the world,” she says with a laugh. She also started a new gig just days after 9/11. That’s when she framed her strategy for managing through crisis. “Just do it. Focus on sustaining momentum and doing things of interest, even if you have to sacrifice scale in the interim. Plan for the future, and be ready to launch new ideas, pronto.”

She scuttled plans for expansion, sliced the budget and forged ahead with top-notch exhibitions ranging from a definitive Wayne Thiebaud retrospective to an edgy Robert Mapplethorpe photography exhibit and the current “Book of Genesis” project from indie icon R. Crumb. She has burnished the museum’s reputation as an oasis of contemporary art in the center of downtown while pumping up the museum’s outreach efforts — and done it all on the cheap.

“We do the most with what we’ve got,” says the fast-talking executive director over coffee at the museum. “So many museums become overwhelmed by high cost of fixed overhead, which is harder to sustain in a reduced economy. We think that our ability to be very streamlined and nimble as an institution creates great opportunities.”

A high-voltage personality with a quick wit and an intense gaze, Krane has proved fast on her feet at navigating the delicate balance between art and finance. Despite a tough arts economy, with disposable income and donations under pressure, the organization has closed in the black the past two years and is on track to do so again when the numbers are finalized for the fiscal year that ended June 30. Total attendance is also bouncing back, from 89,310 in 2009 to 93,120 in 2010. Visitors are still down from 105,980 in 2008 but remain on par with other mid-size regional museums such as the Museum of Contemporary Art in San Diego.

“It’s in a crisis that you really see leadership shine,” notes Kerry Adams-Hapner, head of the city’s office of cultural affairs. “You have to give Susan Krane credit. She balanced the budget while at the same time mounting prominent and important exhibitions. That’s the real test.”

Krane’s hard-charging tenacity has allowed the museum to produce blockbuster shows on a dime.

“Susan is an artist, but I swear there is a part of her brain that is a spreadsheet,” says museum board chair T. Michael Nevens. “Susan has taken the time to listen and learn about this place. A lot of our new focus has come from her.”

It’s a perspective she has honed over the years working at places as diverse as the Scottsdale Museum of Contemporary Art and the High Museum of Art in Atlanta. Since she sees art as a vital part of everyday life, she values high-impact shows that hit patrons where they live over esoteric fare.

“Art is a form of communication,” says Krane. “It connects us with each other, with our own creativity, with ideas. The arts are part and parcel of being curious about life.”

A key part of her method is to pick programs that speak to local audiences but also have global appeal, such as the contemporary Indian art show, “Roots in the Air, Branches Below.” She also keeps the exhibitions up longer than many museums do to give busy Silicon Valley art-lovers a chance to fit the museum into their hectic schedules. It also keeps overhead down.

“You’ve got to know who your audience is,” says Krane. “We live in the most networked, global community in the country, if not the world. A provincial perspective makes no sense in Silicon Valley. We want to connect what happens here with what is happening in the world.”

Many local artists feel a strong loyalty to the museum.

“The museum is home to a lot of California artists,” says figurative painter Hung Liu. “The people there really care. No matter how big or small a museum’s budget is, if you don’t care about the community, you have no roots.”

Krane admits she would love to go on a buying spree and expand the permanent collection, which currently stands at 2,000 pieces of contemporary art from sculpture to new media. Her wish list is long and eclectic, including everything from a Hiroki Sawa video installation to a Diebenkorn masterpiece. But she believes that the institution’s modest $4 million 2010-11 budget, down from $5.9 million in 2008-09, is not an obstacle to capturing the public imagination. (Staff has also been trimmed to a lean 26, down from 34 in 2008-09).

“In a mid-size institution, you may never have the resources you want, but you can have interesting ideas and make them happen more easily than in a large bureaucracy,” she says. “There’s an ability to move on things and to shift course quickly.”

Tapping into the valley’s zeitgeist is also central to her strategy. From the “beta lab,” where emerging artists have free reign, to the “art rages,” after hours parties when you can peruse the galleries amid cocktails and DJ beats, Krane works hard to welcome visitors who may bristle at a highbrow attitude.

“This is not an aloof or elitist institution,” says Krane. ” It’s not the kind of museum where you feel like you have to be silent in the galleries.”

While the museum’s populist spirit traces back to its founding in 1969 — the brainchild of a group of San Jose State University art professors — many credit Krane with upping the ante on accessibility. She has put a lot of focus on outreach programs from lunchtime lectures to the do-it-yourself photo studio in the Mapplethorpe show. She has also maintained SJMA’s status as an anchor of “01SJ,” the biennial festival of electronic arts.

“She aligned the mission of the museum with the story of the valley so that the institution reflects the innovation and diversity of the valley,” says Adams-Hapner, whose office provides oversight to many local arts institutions.

“They never say ‘No, we can’t do that,'” agrees innovative light artist Leo Villareal, who had his first major survey show at the museum. “They are always ready to go for it, ready to embrace high-tech, high-art and the DIY community. They are very attuned to the energy and vitality of the city.”

Krane loathes the art world cliche of white wine in plastic cups. The last thing she wants the museum to be is predictable. As she puts it, “The arts used to have the claim on creativity: we’d like some of that credit back.”

An outspoken advocate for the arts, Krane has also spearheaded efforts to lobby for more government support. It’s all part of her mission to raise the profile of the arts in the Valley — and to get the museum the attention she believes it deserves.

“People call us a hidden gem, which is very nice, but we don’t want to be hidden,” says Krane. “We want more people to know about SJMA and remember that this is their museum.”