Today's Tip

Questions to Ask When Hiring a Web Developer

If you are a business owner who is not an expert in Web development, finding someone you can trust to build your website is critical. To help with the vetting process, here are some questions to ask your would-be developers before making a decision.

1. What do you do? Developers should be able to explain what they do in terms you can understand. Don't let them confuse and/or bore you into working with them.

2. Can you break down the process for me from start to end? Choose developers who use an iterative approach rather than a "one giant deliverable" or "waterfall" approach.

3. What are your goals for my website and how do you intend to accomplish them? Asking this forces them to outline their future plans. It's important to know they have some.

4. Do you work predominantly with open-source or proprietary software? One of the main benefits of open-source software is being able to pick up where others left off. Should you choose a firm working with proprietary software, you may be locked in with that company for good.

5. How long will it take you to respond to e-mails? If you find yourself waiting awhile for answers, chances are your developer's team has not been working on your site or has taken the project in a different direction.

6. Do you outsource? Web companies that outsource their projects tend to subscribe to the one-size-fits-all approach, and you are unlikely to get the custom work you desire.

7. Will my website be scalable? Your developer should be familiar with the combination of hardware/software needed to ensure full scalability so that your site doesn't crash the instant it gets some traffic. Important systems like database clustering, memcache, query optimization, and others shouldn't be foreign concepts to them.

Uri Foox
President and Founder
Pixafy
New York

Optimize Your Company's Online Checkout Process

If your e-commerce site isn't performing as well as you'd like it to, go through your checkout process and make sure your site is optimized to successfully lead people through the payment process without them abandoning their purchases.

1. Install funnel tracking. Before you even start improving your checkout process, you should have a clear idea of where abandonment occurs most frequently during the checkout process. Use your Web analytics software to track it and identify what's going wrong.

2. Don't require an account. Every single one of us has more online account logins than we can possibly remember. The last thing anyone wants to do is create a new one just to buy a pair of shoes or a throw pillow. Allow users to continue as guests by simply entering an e-mail address. Forcing people to create an account can cause them to abandon their cart at the first step.

3. Keep the process as short as humanly possible. It can be tempting to try to grab as much information as possible from users when you have them at the checkout, but you should resist this urge. Require only the information needed to complete the order.

4. Clearly outline checkout steps. Don't let the final step of the checkout process come as a surprise to customers. Include a progress indicator bar so users can easily identify where they are in the checkout process and avoid ambiguous button text such as "Continue." It's better to include descriptive button text such as "Continue to Shipping" for the shipping info step and "Make Payment" for the final step of the process. This eliminates ambiguity among users about what they should expect and makes them less hesitant to continue to the next step.

5. Allow for easy backtracking. Make it easy for customers to backtrack to previous steps of the checkout and allow them to easily modify their order without leaving the checkout page. If customers can't modify orders, they may simply abandon them instead.

6. Eliminate other means of navigation. As mentioned above, it's good to make it easy for users to backtrack through the checkout process, but don't make it too easy for them to become distracted and leave the checkout without completing their purchase. Eliminate side navigations on checkout pages so users are not tempted to abandon the checkout process.

7. Make help easy to find. Display contact info or "Contact Us" buttons prominently on checkout pages. If a customer has a question that isn't answered on the site, and she can't find your contact info, you are most likely going to lose the sale.

8. Confirm and follow up. When users complete the process, send them to a clear confirmation page and set their expectations for what will come next. Tell customers to expect an e-mail from you further confirming their order. Doing so reinforces trust and credibility.

Alanna Francis
Marketing Strategist
Blue Fountain Media
New York

Protect Your Business from Cybercrime

Cybercrime has become big business and cyber criminals are looking for new targets. Bubbling up to the top of the list are small and midsize businesses. Why? Small businesses usually don't have a big security department or investments in high-powered network defenses and services, which means attackers can often get in with less effort. Here are some tips to keep your small business safe:

1. Hard-disk encryption for laptops. In a small business, employees wear lots of hats and often work outside the office. On a single laptop there is likely to be a bounty of data waiting to be pillaged. Encrypting hard drives helps to protect vital data in case of theft or loss—a crucial step given that an estimated 800,000 laptops are lost or stolen every year in airports alone.

2. Consider going "cloud." You may not have the resources to have a security staff but your cloud service provider should. Moving e-mail and other services to the cloud can sometimes save money and, if you are a small business, it may actually keep you safer.

3. Security awareness training. Hackers have honed their skills in automating credible phishing attacks. Large companies have whole departments and expensive monitoring systems to help filter these messages out, but in small businesses every employee is a soldier on the front lines. Doing some basic security awareness training and sending someone from the IT department to a security conference to learn about the latest attack techniques can help keep the business safe. Most people want to do the right thing to keep their company safe; this helps them figure out the "what to do" part.

4. Have employees go through password reset. Imagine you forgot all your business (and personal) passwords and try to reset them. What questions do you get asked? Is that information publicly available? Can attackers get their hands on it? Even if your passwords are strong, the process for resetting them could be a weak link. Shoring up password reset questions and answers is an important part of defending the business.

5. Lock mobile devices. Imagine you just stepped out of a cab in New York City. As it speeds off, you realize your phone is missing. How exposed is your data? Using a pass code on a mobile phone and subscribing to a remote wipe service—the ability to clean everything off your phone remotely if it's lost or stolen—can save your business some serious heartache. If your e-mail provider already supports remote wipe, activate it and save yourself some sleepless nights.

Hugh Thompson
RSA Conference Chairman
RSA Conference
Santa Clara, Calif.

One Entrepreneur's Secret to Success

Whether embarking on a new concept or re-evaluating an existing business, entrepreneurs have to constantly revisit who they are and where they are headed. We need to continually feed that hungry spirit that got us here in the first place and always lead the initiative to keep our work creative, flexible, and innovative. So what does it take to keep that initial energy alive? Like in a good marriage, I doubt there's any one magic answer, but here are some tips I've seen work for myself and for many of my entrepreneurial friends.

1. Stick to your ethics. No matter how much you may need revenue, clients, or recognition, if you compromise what you believe in to get there, you'll never be truly successful. I've fired high-paying but abusive clients, fired friends who just didn't belong in the job, and hired family members even when people thought I was crazy—all because I stuck to my core beliefs.

2. It's important to know yourself—but more important to trust yourself. There will be plenty of people who give you advice and tell you what to do, what not to do, how to do it, or how not do it. Like with parenting, you have to trust your gut about what decision works best for the company you've built and the people involved in it.

3. Make faster decisions. I need to heed this advice more myself. Too many times I waste cycles thinking of all the what-ifs, ands, or buts, only to come to the same conclusion I had in the first place. When you overthink it, you can become paralyzed.

4. Don't internalize or personalize. Being a business owner and an entrepreneur means you have to make tough and unpopular decisions. Doing so is often a conflict between how you feel as a person and what you know as a business leader (see above comment about firing friends!). These two elements do not always jibe—and you have to recognize that sometimes others just won't understand. So be it.

Christine Perkett
CEO and Founder
PerkettPR
Boston

A Better Intranet System

No matter how big your business, nothing can get done without communication. Implementing an intranet system is a fast, reliable, and secure way to communicate within any business. If you are considering setting up such a system in your company, here are some things to consider:

1. Get input from employees. Involve your employees in creating the most ideal intranet system for your company. There is no sense in wasting money on a system your employees will not find helpful, so ask what they will actually use on a day-to day basis.

2. Keep it simple. The potential of an intranet system is huge and can be overwhelming at first. One way to keep it simple is only including features that will be useful. Even though all the bells and whistles may be fun, it will just crowd the intranet and confuse your users.

3. Make it secure. Some intranets are actually extranets and can be accessed by a few on the outside of the company. However, most companies would be better off keeping it strictly intranet to ensure ultimate security of information.

4. Plan for growth. Companies always grow, so installing an intranet system that can grow with the company is vital. Having a cushion for growth prevents having to switch to a larger server sooner and also avoids shutting down servers completely.

Dan Martin
IFX
President and CEO
San Diego

How to Manage Teams Outside Your Office

Coordinating office efforts can prove difficult within the confines of your own building. So when you're working with a team that is on the road, in a different time zone, or across the pond, things can easily ripple out of control. Be sure your hard work is put to good use with effective communication.

1. Keep communication consistent. Unchecked teams can easily get derailed, so you need to check in regularly. Also keep your form of communication consistent. If e-mail is what gets your team in motion, after phone conversations or important informal discussions, send a prompt e-mail to the team with the highlights. Spell out what you need from them.

2. Use the cloud. Take advantage of remote file synchronization and move files off servers if you find you're consistently on the go. Get as much paper as you can into the cloud. Let your team have access to notes, collaborate on documents, or even file expenses digitally. It is quite easy to clutter a desk in paperwork—make it just as easy to eliminate that problem.

3. Stay accessible. Studies show that teams don't tend to take advantage of collaboration tools. Use whatever works, whether that's IM, Skype, or Google Docs, to stay on top of work. Simply allowing your team to see that everyone is plugged in visually lets them know the distributed office is there and being productive. Messaging services also let team members ask quick questions, reschedule calls, or bounce ideas off a co-worker informally and fast.

4. Don't fear the meeting. No one likes meeting for the sake of meeting but it's critical to have at least weekly check-ins to keep teams on track. Keep a tight agenda and be respectful of your team's time.

Prasad Thammineni
Co-Founder and CEO
OfficeDrop
Cambridge, Mass.

Take Control of Cash Flow

As a credit manager and former owner of a collection agency, I have seen firsthand that businesses without credit policies in place often suffer—and sometimes even fail. A credit policy protects a business's most important asset: its cash. If your business extends credit, you need to protect your cash flow and limit your credit risk. If you have customers that aren't paying you on time, they are destroying your cash flow and your ability to pay your own bills on time as well as your bottom line. Now is the time to take back control of your cash flow with these five steps.

1. Call every past-due customer and ask for payment in full. Always begin every collection call asking for full payment and work your way down from there. In this economy it may not be feasible for someone to make the full payment, so be prepared to offer payment plans. Try asking for half the balance now and the other half in two weeks. Remember to offer a solution to the customer to create a win-win situation for both of you.

2. Stop shipping orders to customers that owe you money. If a customer is past due and places a new order, put that order or account on hold until the balance is paid and you renegotiate payment terms for the new order. Otherwise you may find yourself in the same situation again once payment for this new order becomes due.

3. Check every customer's credit. Because our economy has changed, your customers' credit situations have changed, too. Folks who may have had great credit a few years ago may not have such good credit now. Re-evaluate all customers' credit limits to limit your risk and help keep your customers out of trouble.

4. Re-evaluate your payment terms. Get paid sooner by changing your payment terms from net 30 or net 45 by offering an incentive for customers to pay you early. Offer them an early pay discount, such as a 2 percent discount if they make full payment within 10 days. This way they will pay your bills first since they can save some money. This helps your customers by saving them money and gets you paid faster by moving your invoice to the top of the payment pile, thus increasing your cash flow.

5. Fire some customers. At least once a year you need to take a good look at your customer base and weed out your problematic customers. Any customer that takes up any of your time or resources by not paying on time is not a good quality customer. Fire them. You want a base of customers that order regularly and pay you on time—not customers that pay late, call to place more orders when they owe you money, or waste your time explaining why they can't pay on time. Once someone doesn't pay on time, you start losing money.

Michelle Dunn
Author of The Guide to Getting Paid
Plymouth, N.H.

Before Seeking Outside Funding

Before business owners look for external sources of funding, my No. 1 piece of advice is to bootstrap (rely on savings, cash flow, and penny-pinching to fund your business, rather than seek loans or investments). If you can make do without outside funding, then you will have no debt and no investors, which means you will be free to take your company in whatever direction you see fit.

If, however, you really do need to seek external sources of funding, make your company more attractive by either being profitable or having a clear, well-thought-out plan in place that shows your company's path to profitability. This will enable you to at least negotiate some of the terms of third-party investments. Showing growth helps, too; even early-stage companies that show solid growth will be attractive to investors. The best way to do this is to focus all of your energies on your core function and outsource what you can.

If you are looking for outside funding, I recommend avoiding venture capital funding in your company's early stages. When there is little you can offer them in terms of value, many VCs will offer to take a controlling stake in your business in exchange for the funds you seek. If you take them up on their offer, you will likely end up with a group of bosses who tell you what to do with your business to ensure a quick return on their investment. Once you've built a team and an infrastructure, and you're profitable, that is the right time to go after VC funding. In the meantime, consider other options. Many times there are alternatives to VC funding, including local angel groups, private investors, and—surprise—friends and family.

Bill Grodnik
Chief Executive Officer
Davinci Virtual
Salt Lake City

How to Measure Your Return on Social Media

Do you know how to measure the return on your investments in social media? Every day we measure returns on our marketing investments. We create e-mail campaigns, attend trade shows, hire SEO consultants—and measure results. Social media are no different. Social media have many uses, including brand building and customer acquisition and support, all of which are of great importance. If you're not measuring success, you won't know whether you are wasting time and money.

Here are ways to measure returns on your social media efforts.

1. Don't get trapped in jargon. Each social site is different. Facebook "likes" and Twitter followers are important numbers. But don't just track those. Track business results. Did you generate leads? Traffic? Did you turn detractors into promoters?

2. Quality matters. Who are your Twitter followers? Are they relevant? Spammers? Lots of people may follow you quickly, wanting you to follow them. If someone looks irrelevant, you're not obligated to follow back.

3. Measure the conversation. When was the last time you forwarded a vendor e-mail? Measure the rate of shares, "retweets," and comments as a way to gauge your reach.

4. Not all social media count. Not all sites are equal. Are there critical influencers in your market? Have you built relationships with them? Are you reaching out to Yelp commenters?

5. Know your visitors. Measure and score those who come to your site, and watch what they are doing. If you do this across all channels, you'll know what's working. If you do it right, social media will power your business to the next level, one customer at a time.

Brian Goffman
Co-Founder and CEO
Optify
Seattle

Build More Intuitive Self-Service

Organizations across industries continue to encourage and deliver more self-service options via websites, kiosks, and automated phone systems in order to cut live-support costs and give consumers more control over their experiences. However, many are failing to design systems and processes with the customer in mind. That translates to increased operations costs and customer frustration and dissatisfaction.

One of the most common pitfalls lies in the most important and basic step in the self-service process: customer identification (or authentication). When customers aren't recognized by automated phone systems in particular, they are forced to abandon self-service and must find alternate ways to complete their transactions, which typically requires costly, live, customer-service support. When we recently analyzed behaviors in authentication during the automated self-service process for more than 300 million individuals in the financial services, telecom, cable, utility, and insurance industries, we discovered that on average, 10 percent who call into an automated phone system will reach a customer service representative because of a failed authentication attempt. Unidentified callers are 30 percent more likely than identified callers to be transferred to a second customer service representative. The analysis also revealed that customers who speak to more than one agent during the call were 12 percent less satisfied as a whole.

How can companies deliver self-service processes that get customers in and out efficiently and effectively?

1. Use a dialed-from number when possible. By identifying customers as soon as they call in with the phone number on file, organizations can immediately recognize the customer and quickly pull up account or service information, with little to no effort on the customer's part.

2. Keep it simple. Organizations should ask for personal identifiers that are easy to recall (such as a phone number or date of birth) rather than such difficult proprietary information as PIN and account numbers, which aren't always readily accessible.

3. Make it easy for customers to retrieve or reset information. This is particularly important in the Web channel, where forgotten passwords account for a significant portion of failures and subsequent calls to representatives. Customers who are offered the option of answering a security question rather than providing an account number are more than 30 percent more likely to be successful.

By applying these proven best practices to the self-service process, organizations can not only cut unnecessary costs and drive higher satisfaction. They will also effectively drive higher adoption rates, simultaneously balancing the goals of the organization and needs of the customer.

Marco Pacelli
Chief Executive Officer
ClickFox
Atlanta

Set Up a Guaranteed Pension Plan

Many successful business owners are looking for ways to secure their retirement future. One way is to purchase a pension solution. Whether it involves pretax or post-tax dollars, all growth is tax deferred until withdrawal, a significant long-term advantage for otherwise-taxable accounts.

Consider the 45-year-old entrepreneur with a $500,000 windfall and more on the way. With the sting of the 2008 stock market meltdown not fully healed, she wants to "put this money safely away" for retirement.

With the right pension solution, she can guarantee an annual income of $128,176 beginning at age 65 for as long as she lives. Some might say she could do better investing that $500,000 over 20 years, but can other investment strategies guarantee that starting at age 65, she will receive $10,681 every month for as long as she lives? If she lives to age 84, the right pension will have paid out $2,563,520. Are you confident enough in your investing ability to think you'll still be generating $128,176 annually if you should live 30-plus years in retirement?

As a financial planner I do not recommend placing the majority of your assets in this type of pension structure. For those seeking retirement guarantees, the right fixed annuity can be an attractive safe-money solution.

Dr. Michael Sullivan
Vice-President
The Estate Planners Group
Washington Crossing, Pa.

Life Insurance as a Way to Give

Many business owners look for sensible ways to share their wealth with family and/or charities. Life insurance is an often-overlooked way to multiply gift or legacy dollars.

Recently a client took out a survivor universal life insurance policy for his wife and himself. The policy beneficiaries are their three grandchildren. The couple decided that as part of their annual gifting plan, they would take just $9,000 of the $26,000 they can give to each of their grandchildren and buy life insurance. A simple Irrevocable Life Insurance Trust (ILIT) was set up and is the owner of the policy.

By making an annual gift totaling $27,000, these 68-year-old retired business owners secured $1.5 million in tax-free benefit for their grandchildren's future. Because the insurance policy is owned by the trust and not by the individuals, their estate will not be taxed on the $1.5 million. They would have to give $27,000 annually for more than 55 years to equal $1.5 million in gifts to their grandchildren.

Other business owners divide gifts to their favorite charities in a similar fashion, paying an annual life insurance premium for an insurance policy devoted to their charity, while also making direct cash contributions. These philanthropists want the joy and recognition of giving cash or appreciated stock annually but have the foresight to recognize the power of amplifying their giving through life insurance.

Life insurance can provide the leverage entrepreneurs are looking for to significantly multiply their gifts to family and charity. Get competent advice and explore the possibilities.

Dr. Michael Sullivan
Vice-President
The Estate Planners Group
Washington Crossing, Pa.

Budget Your Social Media Program

Business marketers already know the value of social media in connecting with desired audiences. However, there is a lack of information to guide marketers on how to measure the true costs of a social media program—or as I like to refer to it, the "I" in social media "ROI." For business owners, understanding the commitment necessary in terms of time and resources is the first step toward appropriately budgeting for a successful social media program.

Here are the three main cost components to a social media campaign, as well as how to determine the investment necessary for each:

1. Content/first impression costs. If you're not delivering an engaging, two-way experience for your intended audience, you will lose the opportunity to engage them again. Before launching a Facebook page, you need to assess the time necessary for a healthy level of engagement. This means a minimum of one to two hours per day spent on developing and posting to your Facebook page, which translates to about 20 percent of a staffer's time—probably in the neighborhood of $10,000 to $14,000 annually. That's just for placing content.

2. Fan acquisition costs. Successful Facebook pages have typically made an investment in fan acquisition. But how many fans do you need? There are no hard-and-fast rules about how many fans spell success. Having in-house marketing staff devoted to attracting fans requires direct and indirect costs. Outsourcing the work may be more cost-effective. Just remember that fan numbers alone do not guarantee a return.

3. Monitoring-and-measuring costs. Collecting metrics and performing analysis add to the total cost of a social media campaign. Third-party companies charge $500 to $1,000 a month for metrics. Facebook provides metrics, too; the key is knowing what to follow. The most valuable interactions to monitor are those that require an individual to click or type—choosing "like," writing comments, and following links associated with your post. If you employ a third party, make sure you get easily understandable reports, training, and trend information as part of the package.

Every social media program is different. There isn't a one-size-fits-all approach for allocating time, money, and resources. However, it's important that you set measurable goals as to what success looks like. Numbers, feedback, and results matter, so make sure you are consistently tracking not only the time you are spending, but what ROI derives from your efforts.

Betsy Weaver
Co-Founder, President, and Chief Executive Officer
UbiCare
Boston

Convince Employees to Work Hard

How can you motivate employees when you don't have financial resources to inspire them, beyond basic salaries? There are several ways to foster teamwork and innovation—keeping staff enthused to not only continue working hard for your company, but to turn out innovative results and stay with you for years to come.

1. Shove them out the door. It's a well-known fact that when employees have a happy work/life balance, they are better at both. As a leader, you need to not only say (through a policy or verbally) that you encourage people to keep sensible work hours, but you also need to show them that you mean it. Call "quitting time" with a surprise happy hour in the kitchen, or have a planned event every Friday afternoon to signify the end of the week for employees. Let them know it's O.K. to leave afterward.

2. Encourage employees to pursue hobbies outside of work and to share their adventures and accomplishments on a blog, internal newsletter, or during a staff meeting. Inspire them by offering a monthly list of things to do around town or by having employees contribute their own ideas. The pursuit of other interests can lead to new ideas for work.

3. Foster competition outside the office. Inspire healthy habits and bonding by starting a competition among staff that has nothing to do with work. It could concern a monthly photo competition or who runs the most races during the year. Maybe it's a weight-loss challenge or a cooking challenge. Less competitive options such as a book club or employee-contributed cookbook can also work. This can help staff get to know one another better as individuals outside of work, as well as bond over shared interests. And that can lead to camaraderie and improved communication at work.

Christine Perkett
Founder and Chief Executive Officer
PerkettPR
Boston

When an Employee Asks for Motivation

The other day I had an employee tell me that he needed me to motivate him. As I stared, dumbfounded, and started to address his concern, it reminded me of some critical characteristics that I look for in employees.

Are they passionate about what they're doing? People who have passion will be motivated to succeed simply because they love what they're doing.

How do they handle adversity or criticism? Nobody's perfect. At one point or another, everybody faces adversity or criticism. I'm always curious to see how people react to that. A motivated person will take the criticism, learn from it, and become better as a result. An unmotivated employee will sulk and pout about it and let it get in the way of accomplishing goals.

Do they need an incentive such as a bonus to be motivated? I've worked with people who do not lag, but do not excel either, until a bonus is offered. Once they know there is a bonus to be earned, they turn into completely different people and achieve miraculous accomplishments.

I want employees who share these characteristics. In basketball, coaches often say that great shooters keep shooting and always believe the next shot is going in, regardless of how many consecutive shots they've missed. I look for employees with enough motivation to keep trying, no matter how many prospects or sales leads have told them "no." Such employees never give up and remain optimistic that the next call is going to be the big sale.

Brad Walters,
Founder, President, and Chief Executive Officer
Monnit Corporation
Salt Lake City