How to Design Your Office for Maximum Productivity

6. October 2015 07:37

beautifully designed office with plants and contemporary furniture

As far back as I can remember, every quarter or so, my staff and I had a major purge day. All regular work gets put on the back burner so we can concentrate on purging our desks, drawers, computers, and files of items no longer needed. I have found it’s good for the soul and it’s good for business. It’s hard to focus on your business when you have piles of items to clear off your desk (or inbox). Even if you don’t mind the mess, clearing the clutter can be incredibly cathartic and sometimes inspirational. Try it.

Once your office is clear of disorder, here are a few office design tricks to keep you working at maximum productivity.

The Open-Door Policy

Usually when I tell someone I have an open door policy, I literally mean my door is open. I thrive amidst the noise and sounds of busy people. But I know that situation is not for everyone. My partner needs a dead-quiet office set apart from everyone and her door is definitely closed.

You know whether or not you even need a door on your office. If you feel like a closed door makes you inaccessible to your staff, only close the door during certain times of the day or when you need to make an important call.

Open Office vs. Walls

Forbes ran a funny blog about why the open office trend needs to die. For most businesses, an open office is distracting, offers no privacy, and inhibits creativity and productivity. There are a few exceptions, such as a close team that needs constant interaction. Overall, if you have an open office, make sure you have a closed conference room or extra office where employees can escape. Even better, see if you can design different types of workspaces relative to the work people do. Gather opinions from the people actually doing the work.

See the Light

How important is natural light? According to a study by Northwestern University, office workers with more light exposure at the office slept longer, were more physically active, and had a better quality of life compared to office workers with less light exposure in the workplace.

If natural light is not possible, install indirect lighting. Direct lighting where 90 to 100 percent of the light is cast downward toward the work area tends to create shadows and causes eye strain. Indirect lighting distributes light equally upward and downward and reflects light off the ceiling and other room surfaces to avoid glare.

Color Counts

Color in the office, on your walls, and in your furniture not only says something about the culture of your business, but it can also affect your mood. Research links green to creativity and blue to productivity. Red is better for detailed work, but it may reduce analytical thinking. And yellow is a no in any environment. Before you paint your office walls, brush up on color's psychological effects.

Raise the Roof

Finally, when in doubt, remember more room is better for productivity and that also applies to ceilings. Studies show high ceilings give room occupants a sense of freedom and heighten brain activity. When shopping for office space, make sure ceilings are at least 10 feet high.

Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at, follow her on Google+ and, and visit her website to get the scoop on business trends and sign up for Rieva’s free TrendCast reports.

How Small Businesses Can Celebrate Fire Prevention Week

5. October 2015 07:45

fire truck in front of a house fire

Break out the banners, but skip the candles – October 4 through October 10 is Fire Prevention Week, an annual event sponsored by the National Fire Protection Association (NFPA). According to the NFPA website, President Woodrow Wilson issued the first National Fire Prevention Day in 1920 to commemorate the Great Chicago Fire of 1871 that killed 250 people, left 100,000 people homeless, and burned through 17,400 buildings and 2,000 acres. The blaze changed the public's perception of fire safety, and ever since, Fire Prevention Week has been observed nationally for four days every October.

The aim of the week is simple: to keep the public informed about the importance of fire prevention. It may seem obvious – of course fires are dangerous; we all know that – but when you live in the middle of a crowded city without a tree in sight, it can be easy to think that fires are only a pressing concern for those on the outskirts of town and near wooded areas. But you'd be wrong.

So long as you have electricity, there's a risk of fire. The NFPA reports that…

  • 369,500 home structure fires in 2013 caused 2,755 deaths and $7.0 billion in property damage.
  • 48 percent of home fires involved electrical distribution or lighting equipment.
  • 29 home fires are caused by candles each day.

If you work in an office, your neighbor's faulty equipment or actions could become your problem (see: "Fire Damage at Chicago's Second City Illustrates the Benefits of Insurance"). And if you run a home-based business, your concern should be double: a fire could destroy your house and your business in one fell swoop.

So now that we have your attention, let's look at some ways you can both celebrate Fire Prevention Week and shore up your home business's fire safety measures.

1. Test smoke detectors.

The NFPA recommends having a smoke detector in each room of your home and a carbon monoxide detector on each floor. Test your alarms to make sure they are in working order.

2. Make an escape plan and perfect it.

Almost 75 percent of Americans have a fire escape plan, but more than 50 percent have never practiced it, according to an NFPA survey. Buck the trend and practice yours this week. If you haven't developed one yet, check out the NFPA's safety guides for a customizable plan.

3. Check your Commercial Property Insurance.

Make sure your Property Insurance policy is up to date. If you don't have one, remember that a standard homeowner's insurance policy usually doesn't cover your business assets (you can learn more about the limitations of homeowner's insurance in this infographic). If you don't want to pay out of pocket for those items in the event of a fire, look into getting a Business Owner's Policy, which bundles Commercial General Liability and Property Insurance together at a reduced rate.

4. Back up data and important records.

Make copies of all your important documents (e.g., contact lists, insurance policies, customer data, titles and deeds, etc.) and keep one set in another physical location. Be sure back up your digital records on an external hard drive, too. If you do experience a house fire, you'll have digital and physical copies at the ready, which can help reduce the business interruption.

5. Review your plan for collecting benefits for property damage.

Fires are devastating enough without the insult of paying for all the damage out of pocket. Talk to your insurance agent to learn about what steps you need to take to make sure you can quickly collect your insurance benefits in case you suffer fire damage. They may recommend that you carefully inventory and document your belongings to make the claims process smoother. Read "Time for an Insurance Inventory for Your Business?" for more information.

Paul Walker Wrongful Death Lawsuit Highlights the Concept of Strict Liability

2. October 2015 07:41

red car driving down a tree-lined road

Entertainment Weekly reports that Meadow Walker, daughter of the late actor Paul Walker, has filed a lawsuit against Porsche over the wrongful death of her father. Walker died in his 2005 Porsche Carrera GT after his friend lost control of the vehicle and it collided with a tree. The lawsuit claims that, because the vehicle lacked safety features that could have saved the actor's life, Porsche…

  • Was negligent.
  • Has strict liability for the accident.

It's a tragic case study in how strict liability works, but a worthy one. Strict liability is a legal concept especially relevant to any business that manufactures or sells products. Let's explore it in a little more detail (don't worry – we'll spare you the complicated legalese).

What Is Strict Liability?

Strict liability refers to someone's total legal responsibility for an injury even if there is no proof that the person in question was negligent, careless, or even at fault. Strict liability often applies to cases involving…

  • Animals in your possession or control.
  • Abnormally dangerous activities (e.g., storing explosives or flammable liquids).
  • Product liability.

For an example of strict liability in action, say you keep your Pomeranian at your store. One day, she slips out the front door and bites the first person she meets. Bad dog! You have strict liability for the bite and subsequent medical costs, even though you didn't intend for your dog to escape or to injure anyone.

Aside from cases involving owned animals, it’s common to see strict liability applied to instances of product liability. Product liability is your legal responsibility to pay damages if you sold or made defective products that harm others.

So let's go back to the Walker case for a minute. Meadow Walker's lawsuit claims that Porsche is strictly liable for her father's death because it sold a defective product. For a successful strict liability lawsuit against Porsche, she only needs to prove…

  • That the car was defective.
  • That the carmaker didn't intend to change the product before it reached the consumer.
  • That the defective vehicle caused an injury.

She doesn't necessarily have to prove how the carmaker was careless.

Here's the big lesson in all of this: in all strict liability cases, the defendant's conduct does not matter. You, the retailer or manufacturer, can exercise all the care in the world in selling and making your product and still be held liable when the products hurt someone.

To learn more about strict liability rules, read All Law's primer "Strict Product Liability Laws."

So Is There Coverage for Strict Liability Lawsuits?

Why, yes, there is. Most General Liability Insurance policies offer Product Liability coverage, which can kick in when you're sued over manufacturing, selling, or furnishing a defective product that causes someone physical harm. And because manufacturers, distributors, and retailers can all be sued over strict product liability, it's a good coverage to have on hand if your business belongs to one of these industries.

In addition to Product Liability coverage, General Liability can provide coverage for:

  • Legal expenses when you're sued over a third party's bodily injuries on your property.
  • Legal expenses when you're sued over a third party's property damage.
  • Immediate medical expenses when someone is hurt on your premises.

To learn more about Product Liability Insurance, check out "Cutting Costs on General Liability Insurance: When You Need Product Liability Coverage." To brush up on what General Liability can do, read "What Does General Liability Insurance Cover?"

Small Business Spotlight: Through the Years with Netfloor USA

1. October 2015 07:39

Netfloor USA logo

Ryan Hulland is president of Netfloor USA. Based in Charlotte, NC, Netfloor USA is a full service design, manufacturing, sales, and installation company for a wide range of raised access floors.

We talked with Ryan about his experience working alongside his family and keeping their generational business growing. Learn how small-business owners can run a successful company while working with family and share its goals with the next generation. The transcript below has been lightly edited for length and clarity.

Tell us a little about yourself. What’s your background?

I'm married, and my wife and I have two incredible children. My family is the most important thing in my life, which can get interesting, considering I work with most of them.

I've been working for the family business going on two decades and have seen it change shape and complexion a lot in that time. It's been a cool combination of challenges, good times, bad times, and many learning experiences. I wouldn't change a thing!

When did Netfloor USA get its start?

While Netfloor USA is "only" five years old, I trace its lineage back to before I even worked here. There have been definite milestones, but overall, I see it as an ongoing evolution.

Netfloor USA is one of the major brands we run from the parent company (MonMan). Long before I began working here, we have been deeply involved in high tech industries. Furnishing tech equipment for data centers is a major part of what we do, and we saw a need in the industry for a better product. Opportunity lined up and we took the plunge, almost overnight becoming a manufacturer, installer, and owner of a brand of access flooring that is a big departure from the industry standard.

Sales pitch aside, the access flooring industry hadn't changed in decades. No one was innovating, and the products were only used in a few specific types of buildings. Netfloor USA has several systems that are much easier to use than the old-fashioned ways. Being more flexible has not only opened up business opportunities for us, but it has also changed the way architects design buildings, how IT managers operate their facilities, and how consumers experience their lives.

That's what we set out to do with Netfloor USA. We wanted to change the raised access flooring industry.

Who runs the business now? How do you split responsibilities and tasks?

My mom Vicky is the owner of our parent company (MonMan), and I'm vice president of that company. I’m the "second in command," so to speak. After my mother, I have the longest tenure of any other family member in the company.

As president of Netfloor USA, our biggest brand, I have significant leeway in how the company will evolve, but my loyalties and efforts will always be split between our customers, employees, and the business itself.

On a day-to-day basis, we have a very flat hierarchy. Anyone in the company can make suggestions, call someone out for a good job (or bad), and while the final decision does have to lie with a single person, we make the process as democratic as possible.

What sets you apart from companies with similar products?

We're an agile, innovative company in a mature industry, and that's incredibly valuable to our customers. Because our customers' needs are always changing, working with Netfloor USA is often the only way they can achieve the end result they envision.

Whether it's a data center for a major search engine, the largest mobile retailer in the country, or a local 911-call center, we make it easier for our customers to install and manage IT infrastructure than anyone else. We make businesses easier to run, and in the end, it makes people's lives a little bit better.

Did you ever consider a different line of work?

Even though I was surrounded by the business every day while growing up, it was a long time before the thought of working with the company crossed my mind. There was never any pressure or expectation for me to join the family business.

As a matter of fact, I feel there were times when I was encouraged to forge my own path and not join the company. I think any good parent would be torn between wanting to have their children follow in their own footsteps and hoping to see their children become something better.

How will the business adapt as time goes on?

Multi-generation family businesses must constantly ask themselves, "Who are we? What do we do? How do we want to be known?" You must continually assess your business and the marketplace just like any other company, but the pressure to stay relevant and to carry on the original mission feels much higher in a family business.

The biggest challenge to adapting is being willing to completely let go of what you've done in the past and work toward something new and exciting. It's almost counter-intuitive because many people feel a family business is all about tradition and being well known in the industry for that "one thing" you do really well. That urge must be met with an even stronger will to evolve and become better.

Does the next generation plan to carry on Netfloor USA's mission?

You not only have a responsibility to the here and now, but, if the company is to grow as a family business, you have to work to include the next generation. I have two children of my own and one of them is old enough to work part time in the office. As far as I can tell, he loves it. I wouldn't be surprised if he one day joins us full time. My other child is younger, so we aren't sure yet. But the door is open to them at any time.

Just like any aspect of parenting, you can't force your kids to do anything. The best you can hope for is to provide a strong, positive influence on them, but the choice is 100 percent theirs.

How does being a generational business affect your community?

We are very much involved in the local and regional community. For example, we've made annual donations to the same local charities for over 20 years. It's to the point to where most nonprofits don't bother to ask for a donation; they just send us the invoice because we've always donated. It's not presumptuous of them; it's just cool.

Like everyone else, we've been impacted (in good ways) by the information age. Past involvement in city organizations has grown into state and nationwide organizations. Over the past few years, our reach has extended globally. It's easy for anyone with an Internet connection to make ties around the globe, but for a generational company, the big challenge is defining your community.

What advice would you offer other small-business owners looking to keep a family business afloat?

There is something about starting a business, growing it, and planning for the future well enough so you can involve your family that will be far more important than money for many people. Before you are faced with the decision to either sell your business or keep it and work hard the rest of your life, take a good look at yourself and decide what really matters to you! There's no wrong answer.

Tips from Netfloor USA on Running a Family Business

  • Decide what your endgame is. Some people start a business, grow it, and then sell it to another company. You can't blame someone for wanting to cash out on their hard work. There's something to be said about not selling your company, though.
  • Plan ahead. Besides being passionate about what you do, it’s all about planning ahead while being as agile as possible. Any business that wants to be around in five years has to do that, but it's even more important for a family business.
  • Honor tradition, but be ready to change course. The pull of tradition can become your company's Achilles' heel. The best way to honor the founder, even if it means changing course, is to grow the business. That's exactly what they wanted to do when they started the company.

Check out previous posts in our Small Business Spotlight series for more small business stories and tips.

E-Commerce Businesses: Be Ready for a Fraudy Fall

30. September 2015 07:58

man shopping online

We've been discussing EMV credit cards a lot these days because by October 1, 2015, most card issuers will have sent out these chip-enabled cards to customers. That's important for a few reasons:

  • Financial institutions are switching from magnetic stripe cards to EMV cards (aka chip cards) to help reduce card-present fraud and bolster security for customers.
  • Merchants are expected to be EMV-compliant by October 1.
  • Merchants who don't have chip card readers by that date will inherit the liability for card-present fraud made possible by swiping the magnetic stripe of a chip card.

In case you missed all the talk, our infographic can help get you up to speed, and the post "3 Things that Can Make You Liable for a Data Breach" can give you a better idea about when you can be held liable for in-store credit card fraud.

The shift to EMV cards is expected to reduce in-store fraud, but according to research by Trustev, an online fraud prevention tech provider, it won't do anything to protect against online fraud. In fact, Trustev predicts e-commerce fraud will rise 106 percent in the United States three years after the EMV switch. That prediction is based on what happened in other countries three years after they became EMV-compliant:

  • Online retail fraud rose 100 percent in Canada and Australia.
  • E-commerce fraud rose 89 percent in the United Kingdom.

But that doesn't mean your online shop is doomed to be hacked left and right. To prevent as much fraud as possible, e-commerce businesses should take the following precautions.

1. Use the available fraud prevention tools.

That may mean using an address verification service (AVS), which allows you to compare the billing address to the address the card issuer has on file for the card. If the addresses don't match, it may be a stolen card. You should also request card security codes for a card-not-present (CNP) transaction. This extra step ensures the buyer has the physical card in hand at the time of payment.

2. Watch out for red flags.

Unlike your legitimate customers, thieves tend to not care if they are charged a premium for shipping costs. You may want to verify when buyers chose pricy next-day shipping options.

And if you see a repeat customer make an unusual purchase, validate the order. It's an opportunity to connect with the customer and look out for their security, too. For more low-tech ideas, check out UniBul's card-not-present fraud prevention tips.

3. Invest in authentication services.

Sometimes high-tech risks call for high-tech management. If you process a high volume of online sales and can't take the time to personally validate all orders that may or may not be fraudulent, it may make sense to use a service that monitors CNP transactions. For example, RSA Adaptive Authentication for eCommerce scopes out threats in real time by looking at more than 100 fraud indicators.

Other related services can tokenize data so that if criminals capture it, they can't do much with it. Essentially, tokenization removes the account number on the payment card from your database and replaces it with a string of random letters and numbers. You can learn more about these advanced e-commerce fraud prevention techniques in RSA's whitepaper "Card-Not-Present Fraud in a Post-EMV Environment: Combating the Fraud Spike" [PDF].

5. Carry Cyber Liability Insurance.

The hard truth: criminals may still find a way around your fraud prevention measures and your best cyber security defenses. That's why it's smart to have a response plan in place that can help you manage the cost of a data breach. Cyber Liability Insurance can help pay for credit-monitoring services, customer notification, and good-faith advertising after your e-commerce business has been hacked or compromised. To learn more about data breaches and how they impact small businesses, read "Data Breaches Cost 2.5x as Much as Burglary."

Study: Doing the Right Thing Is Good for the Bottom Line

29. September 2015 07:51

creative team problem solving together

We tend to believe behind every great company, there's a great, role model-worthy leader. But that's not always the case. A company can still be successful and have leaders with little to no character. Leadership will ultimately be reflected in its bottom line, especially when measured against businesses that put people with high character in charge.

Take, for example, Fred Kiel's seven-year study of more than 100 CEOs, their companies, and 8,500 of their employees, as reported by the Harvard Business Review. Kiel found that leaders with strong character made up to five times the return on investment that leaders with weak character did.

What does Kiel mean by "strong character"? According to his interview with The Washington Post's guest writer Tom Fox, strong character is measured by what we usually deem to be "good" traits:

  • Compassion.
  • Integrity.
  • Responsibility.
  • Forgiveness.

This is all heartening new for small-business owners that take the time to build relationships with their employees and keep the human element of their business at the forefront. This study shows a compassionate leader tends to see more economic gains, which can help the business stay in the black.

On Compassionate Leaders, Employee Loyalty, and Productivity

Of course, you can't build a company on good principles alone. It also takes business skills and vision. But you can hardly execute your goals without the support of your team behind you.

The best way to get that support is to build relationships with your employees. When you care about the lives and well being of your workforce, your team feels more invested in your business. That means you have an easier time retaining top talent and getting your employees to produce better work.

Consider what Gallup's "State of the American Workplace" survey found:

  • Leaders are the biggest influence on whether or not your employees are engaged in their work. A leader who cares about their team tends to have more engaged employees.
  • Engaged employees are more productive. By contrast, the survey finds that employees who aren't tuned into their work cost businesses $450 billion to $550 billion in lost productivity each year.

You can read more about employee engagement in our post "Why Small Businesses Shouldn't Hire 70% of Employees."

How to Consistently Display Strong Character in the Workplace

Displaying strong character isn't a one-off deal – it's something you must exhibit day in and day out. How can you make sure you're putting your principles into practice? Here are some ideas:

  • Listen to your team. A good leader has the ability to listen and adapt accordingly. Many of the great leaders we look up to in business today didn't get to the top by relying on themselves alone (more on the greats here: "For Better Business Outcomes, Try Getting It Wrong"). They surrounded themselves with smart people and good advisers. Moreover, if you want your team to engage with their work, you should make a habit of engaging with them and asking for feedback.
  • Show that you care. Acknowledging birthdays, special occasions, and important work or personal accomplishments shows employees that you don't just view them as work drones. On a similar note, encouraging a work-life balance demonstrates compassion, which Kiel notes is one of the most powerful ways to engage a workforce.
  • Stick to your principles – especially when things go wrong. It's hard to be our best selves when frustrations, roadblocks, and accidents pop up. Unfortunately, these are the times when the caliber of your leadership will be most remembered. Say an employee is injured at work. You can put your best foot forward by keeping in touch with them throughout their recovery. That extra effort can help build the employee's morale and assuage harsh feelings toward your business. Read more about that in "Workers' Comp Investigation Offers Small Businesses a Reminder to Communicate."

On a related note, find out how employee wellness programs can help you reap two times the ROI in "Study: Wellness Comes Back to Small Businesses Twofold."

What Small-Business Owners Should Know about the Contingent Workforce

28. September 2015 06:34

woman drinking coffee and working from a laptop

Dr. Deborah Osgood is the cofounder and CEO of the Knowledge Institute for Small Business Development (KISBD), which offers consulting, training, and development for small businesses and entrepreneurs. She is the recipient of numerous awards in small business development and leadership, and has worked with top private- and public-sector organizations, including Microsoft, IBM, Bank of America, Verizon, American Express, the US Department of Labor, and the US Small Business Administration.

We had the pleasure of talking to Dr. Deborah Osgood about the contingent workforce. She offers pointers on how small-business owners can take advantage of contingent workers and how contingent workers can appeal to small businesses. The interview below has been lightly edited for length and clarity.

First of all, how would you define the “contingent workforce?”

“Contingent” refers to the practice of more employers utilizing workers on a non-permanent basis. A September 2014 survey by the Freelancers Union revealed that 31 percent of today's workforce represents contingent labor, and this number is expected to jump to 40 percent by 2020. Six months later, the US Government Accountability Office reported that 40 percent of Americans are already working on a non-permanent, project basis.

When or why should a small-business owner consider tapping into this workforce?

There are a variety of factors that influence when to go with a contingent worker versus a more traditional, full-time employee. The first thing to consider is whether your need is temporary or longer term. For example, if a current employee goes on maternity / paternity leave or leaves to care for a family member, the need to fill the gap will likely be temporary.

If, on the other hand, your business is experiencing routine increases in business resulting in a lot of paid overtime, you may want to consider a contingent workforce strategy. Going with a non-permanent, project-based worker allows you to fill a seasonal increase and to try out a new worker before deciding if it's a good fit.

We've heard a lot about the Labor Department cracking down on employee misclassification lately. How can small businesses make sure they’re on the right side of the law?

The US Department of Labor Fair Labor Standards Act provides a framework to help determine whether a worker qualifies as an independent contractor or an employee. In general terms, this includes six key areas:

  1. The nature of the work relative to the overall business operation.
  2. The length of the working relationship.
  3. Who owns what in terms of facilities and / or equipment required to perform the work.
  4. The nature and degree of who controls the work performed, the standard of quality, the rate of compensation, and whether the worker works for other clients.
  5. The worker's profit / loss position in the relationship.
  6. The level of skill required to perform the work, and the extent to which the worker advertises themselves as available for contracting with other employers.

One way to support compliance is for the employer to require that the independent contractor provide proof that they are a registered business entity, such as a limited liability company (LLC), and that they possess their own business insurance, including Workers' Compensation Insurance.

For contingent workers, such as independent contractors, freelancers, and consultants, where are some of the challenges and opportunities?

According to the US Staffing Industry Forecast, the contingent workforce is projected to grow six percent in 2015, followed by five percent in 2016. These trends continue to represent challenges and tremendous opportunities for workers.

In terms of challenges, individuals need to learn and implement many of the traditional operational elements of a small business, such as registering as an LLC, securing business insurance, and managing their own payroll taxes and medical insurance.

In terms of opportunities, going contingent offers a broad range of benefits, such as maintaining quality of life goals while also attaining income objectives. There are a growing number of online work platforms (OWPs) that are specifically designed to help freelancers connect with work gigs, such as…

Where, when, and how you do your work is also up for negotiation. It's not uncommon for a talented graphic designer or programmer to live in one country and work for multiple small businesses located across the globe.

What should they understand about small businesses to make themselves more attractive as a potential hire (either as a contractor or, down the road, as a full-timer)?

An independent contractor competing for work should ensure that they're helping the employer to remain compliant with applicable labor laws. That might mean marketing yourself upfront as having a registered business and insurance, as well as marketing your relevant skills, experience, and knowledge. You may want to employ some of the more common small business marketing practices, such as having your own website, participating in targeted social media arenas, and having business cards.

How can small businesses take advantage of contingent workers to make themselves more competitive with larger competitors?

Going contingent allows smaller businesses to test out which skills are needed for what amount of time to support growth objectives. The challenge is ensuring that you're attracting, recruiting, and retaining top talent without the process becoming so time-consuming that you lose sight of the bigger picture.

For more tips about managing the risks of project-based work, check out our freelancers blog series.

Data Breaches Cost 2.5x as Much as Burglary

25. September 2015 06:20

masked man breaking into a house

No, we're not talking about big-retailer data breaches or jewelry heists. We're talking about the data breaches and thefts that happen specifically to small businesses. Let this sink in for just a second:

So a data breach is two and a half times costlier than a break-in if you're a small-business owner. But which of these events are you more prepared for?

Chances are it's the burglary. At the very least, you probably lock your shop or office doors at night. You may even have a security system in place. When it comes to securing sensitive data? The numbers are telling.

Small-Business Owners and Data Security: A Complicated Affair

Most small businesses realize that the time for taking cyber security lightly has passed, and as we reported before, many cite cyber risk as one of their top 10 concerns. That makes sense – data breaches regularly make headlines these days, and the aftermath is well documented and expensive. More on that in "Target's Cyber Liability Insurance Covered 36% of Its Data Breach Costs. How Much Does Yours Cover?"

But that doesn't change the fact that…

So why the disconnect? Why are small-business owners reportedly aware of their cyber risks but slow to do much about them? We have a few ideas.

Data: Out of Sight, Out of Mind

It's easy to have theft on the mind every day – you can see your physical storefront, merchandise, laptops, computers, and tablets. You know how much you paid for these items and roughly how much they'd cost to replace or repair.

But data breaches are a different story. You can't see data being transferred back and forth from your computer. You probably don't leisurely browse through your digital records for fun. Moreover, you may not have paid for every bit of data you've acquired over the years, so you may not think of it as inherently valuable. These truths may keep data security from being a top-of-mind concern.

That's the tricky thing about data: its value only becomes readily apparent once it's been lost or stolen. Each stolen record may come with a price tag of about $154, according to the Ponemon Institute's 2015 Cost of Data Breach Study. In short, cyber security is something that business owners can't afford to ignore.

Get Educated on Cyber Security

You don't have to start from scratch. Ask an agent about Cyber Liability Insurance, and check out the following articles for tips on boosting your data security:

Lastly, remember that data breaches aren't always the result of hackers kicking down your cyber door. Sometimes, they can happen the old-fashioned way: through credit card fraud via card readers. That's why financial institutions are phasing out magnetic stripe credit and debit cards and replacing them with EMV (or chip) cards by October 1, 2015. Card-present fraud was a big enough concern that regulatory bodies decided to switch to a more secure type of card.

You can check out our chip card infographic to learn more about what that means for small businesses that use credit card readers. Essentially, you have to switch to an EMV card reader or else you take on the liability for card-present fraud. Learn more about it in our post "The Small Business Guide to the EMV / Chip Card Liability Shift."

8 Website Mistakes to Avoid

24. September 2015 06:09

laptop buried in the sand

Is your website suffering from cart abandonment issues? What about an oversized bounce rate? If you’re feeling the need for a website makeover, fix these eight common mistakes to improve your website's success.

  1. Long load times. When you include too many images and large graphics, websites take too long to load and customers get frustrated. Keep your home page and other important pages clear of clutter so users don’t get impatient and leave. As customers go deeper into your website, they’ll be less fidgety and more willing to wait longer, but you still need to keep pages loading as fast as possible. You may need to ask your web host about a using dedicated server and not a shared server for faster processing. Online shoppers only want to wait three seconds or less.
  2. Other slow-down issues. Third-party scripts, such as social sharing icons and widgets, could also be slowing your site down. Ask your web designer about deferring scripts.
  3. Call-to-action buttons that load too late. Make sure your CTAs are above images and load right away.
  4. Browser incompatibility. It’s important to test your website on a number of browsers, such as Google Chrome, Microsoft Edge, (the old) Internet Explorer, Safari, and Firefox, to make sure it shows up correctly in every browser your customers might use.
  5. Mobile neglect. Is your website mobile friendly? According to the Pew Research Center, nearly two-thirds of Americans own a smartphone and 19 percent rely on a smartphone for accessing the Internet. With that in mind, make sure your website is clean, simple, and easy to navigate using your index finger or thumb. Hootsuite offers even more mobile website tips.
  6. Poor design. If your website is thrown together and disorganized, it hurts your business's credibility. Give viewers the online experience they expect from a trustworthy business. Use an attractive template to design your website if you prefer to DIY, or hire a designer or your web host to design your site.
  7. Annoying pop-ups. There’s nothing wrong with pop-ups, but give your users a chance to actually experience the site before you blast them with offers and requests.
  8. Contact information that’s hard to find. Many customers will want to ask you questions. If you make it hard to find your contact information, they’ll find another business to purchase from – one where they can easily get their questions answered.

Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at, follow her on Google+ and, and visit her website to get the scoop on business trends and to sign up for Rieva’s free TrendCast reports.

How Your Employees Could Cost You Insurance Coverage

23. September 2015 07:46

toy action figure casting a line on a keyboard

You expect a lot from your employees. Namely, you expect their work to help bolster your bottom line, not take away from it. But a new lawsuit shows how an employee's unsuspecting mistake can lead to serious losses.

According to a report by Advisen, three employees of Medidata Solutions, Inc. were targeted in a phishing scam that ended with them inadvertently transferring $4.8 million to a criminal's bank account in China. The report states the impostor's scam was convincing at every turn:

  • The e-mail appeared to be from a company executive.
  • The email included the actual executive's picture and signature.
  • The message was altered so it appeared to be sent from the executive's company e-mail address.
  • The employees were instructed to contact someone pretending to be the executive's attorney.

So, the report continues, Medidata did what any company with a Cyber Liability Insurance policy with computer fraud coverage would do: it tried to get that lost money back from the insurer. The provider claims that its employees handed that cash over voluntarily, and given the policy's language, coverage doesn't apply. To which Medidata responded, "Here's a lawsuit for you."

It's an interesting turn of events: an obvious fraud being denied coverage because the employees were manipulated rather than the computer system. Sophisticated cyber exploits can quickly get out of hand if you don't train your employees properly.

Risk Management Isn't Just Good for Business – It's Good for Your Coverage

If the Medidata debacle illustrates anything, it's that your business is only as protected as your internal risk management efforts. Even when you have insurance, you need to manage and reduce risk proactively to truly keep your business safe.

As we covered in "Applying for Cyber Insurance? Talk to IT First," your insurance coverage may hinge on whether or not you actually implement the risk management strategies and training that your insurance application claims you do. In that instance, a nonprofit hospital system's application affirmed it encrypted its patients' data, but during a data breach investigation, the provider found it didn't and challenged its duty to cover the $4.1 million claim.

So your motivation here is twofold:

  1. You want to manage risks to keep data breaches and phishing schemes from happening in the first place because they can be nightmarishly expensive.
  2. If you put risk management first but still suffer a cyber attack, your provider will have a harder time denying an applicable claim because you upheld your part of the bargain.

Now for the next question: if the risk you need to manage is human behavior, where do you start?

On Keeping Employees from Falling for Phishing Emails

In a spear phishing attack, the con artist poses as an executive or a vendor and tries to get an unsuspecting employee to either give up login credentials or to transfer funds to their bank account. Of course, you don't want to tell employees to not respond to their superiors on the chance a message could be a fraudulent one. At the same time, how are they supposed to tell who is really emailing them when the message has all the hallmarks of an authentic email from the supposed sender?

In the post "23% of Small Business Employees Still Make This Critical Mistake," we discuss some tips for spotting sloppy phishing emails, but to guard against sophisticated attacks, you should...

  • Inform employees about phishing scams so they know what to watch out for.
  • Instruct employees never to give out login credentials online or over the phone.
  • Let employees know they will never get a legitimate request from a superior for a fund transfer via email.
  • Have employees run big expenditures by you for approval.

The Advisen report notes that compromised email scams have racked up almost 2,000 victims and $215 million in losses since 2013, according to the FBI's data. Give your business its best chance to dodge these tricks by staying informed and prioritizing employee training.

To learn about other cons that can cost your business big, read "Small Business Scams Aren't All Online" and "Hello? It's Me. I'm Hacking You."

Customer Rating 4.9 out of 5
Read Customer Reviews