Wiley Harrison, Owner, Business of Your Business
Stacey Cohen, President & CEO, Co-Communications
Susan Corcoran, Principal, Jackson Lewis P.C.
James Kudla, President, Tarrytech Computer Consultants
Joanne Murray, Owner, Allan Block Insurance Agency
John Tolomer, President, The Westchester Bank
WILEY HARRISON: Like myself, I’m sure there are many Westchester business owners who have questions about how to operate our companies successfully going forward. To that end, we’ve brought together local experts in five fields — IT, marketing, banking, insurance, and law — to help us out. We will begin with John Tolomer, president of The Westchester Bank. John, what has the bank done to help support small businesses during this crisis?
JOHN TOLOMER: I think one of the things COVID did for us is really give us a banking [experience] made personal. Although we couldn’t do banking in-person because of the pandemic, it didn’t deter us. Unlike a big bank, which would be calling to ask, “Are you going to make a payment?” we were [reaching out to customers and] asking, “How can we help you get through this?” So it was really a manifestation of our slogan, “Banking made personal.” Our customers really responded to it. As the pandemic got worse, we were able to tell our customers about how to do their banking remotely without having to come in, and that created a great relief, so, whether it was scanning deposits or using a mobile app or going to the ATM, we had remedies for them to continue to have their banking made personal. That’s really what sets a community bank apart from a larger bank, which just isn’t built to do those things. So, to this day, we contact our customers to see how we can help them both on the depository side and the lending side.
WH: What about the Paycheck Protection Program loans? What was the impact there?
JT: PPP came along in early April, and that was really a challenge because we had so many customers who wanted to avail themselves of the program. We were fortunate: We did upwards of $85 million in PPP loans and saved about 7,000 to 7,500 jobs. We were able to help both for-profits and nonprofits, and that continues to be our focus, making the first move in contacting our customers to see how we can help them. [This approach is] how our assets went from $23 million to $1.2 billion in the 12-year span [since the bank was founded], so we know what works. We try to be an important part of the fabric of this community.
“People don’t realize… how easy it is [for bad actors] to gain access to your systems and information.”
– James Kudla, President Tarrytech Computer Consultants
WH: James, how can small businesses be more cyber-resilient in the COVID-19 world, especially remembering that funds are tight right now for everyone?
JAMES KUDLA: Cybersecurity is a big, big deal today. Cybercrime and cyber threats are up significantly since the beginning of the pandemic. Sometimes [your company may be] a passing target, and [cyber criminals] are just looking for systems and networks that are open — they set up millions of threats to find open “doors” that are out there. These bad actors know that millions of people have transitioned from working in the office to working from home, and [they know that companies] weren’t prepared to do that overnight, so there’s obviously some threats and exposure out there.
The most important thing a business can do is to have a cybersecurity plan. It doesn’t have to be extensive, but it needs to start with the decision-makers and the leaders in the company addressing these cybersecurity threats around people working remotely. You need to have conversations about things like: What are acceptable measures [for remote access]? Is it going to be [through employees’] PCs? Is it going to be LogMeIn or a VPN with remote desktop? Companies also have to address what messaging programs to use and figure out how to handle sharing files: Is it okay to send sensitive information via email? Can we use personal Dropbox accounts and be able to share files? Or, are we going to require people to save all information on the company file server and access this information over a VPN? Are you going to require two-factor authentication into your computers to access your email, your files? You also need to discuss your plans for voice over IP phone systems.
What happens [is], people create workarounds to help them be efficient [in order] to get their jobs done, but [by doing that], they are actually opening up the company to cybersecurity threats. People don’t realize how easily they can be compromised and how easy it is [for bad actors] to gain access to your systems and information. So, companies have to start with a policy and then start to implement controls to close some of these loopholes to shut down the cyber threats.
“A common theme we’re all talking about is creating a preventive strategy.”
– Susan Corcoran, Principal, Jackson Lewis P.C.
WH: Susan, what are some of the legal challenges small businesses are facing when it comes to the workforce these days? What are the vulnerabilities that companies need to hedge against?
SUSAN CORCORAN: What we’re faced with is changing times, and a lot of small businesses don’t have the benefit of strong communication. Some companies have relied upon strong relationships over the years with their employees but maybe do not have strong written policies, do not have strong communications about how people have performed in their jobs. What has happened is, because people had to work remotely, we’ve had changed expectations in how we’ve had to do things, or maybe a particular business is an essential business and people have returned to that workplace sooner than other businesses. The other thing is that smaller businesses have been hit harder than larger businesses, and making that tough decision of who may have to be laid off or furloughed [is a challenge] that I’ve seen.
WH: Are companies vulnerable to employees or customers getting COVID? How do we protect our businesses against that kind of risk from a legal point of view?
SC: Every workplace is different, but everyone has been required to follow the governor’s plan and put safety [protocols] in place, so they can have individuals return [to the workplace].
There is a lot of information for employers on the governor’s website, New York Forward [forward.ny.gov ], but it all starts with putting a very stringent [safety] plan in place so that when employees come back to work, they feel safe. The number-one thing that employers have to remember is that they have to be a lot more flexible with individuals who may not want to return to [the workplace] for a particular reason.
“The new competitive advantage is about innovation and change.”
– Stacey Cohen, President & CEO, Co-Communications
WH: JoAnne, what insurance policies should businesses be considering today — things like business interruption, communicable-and-infectious-disease coverage? What do businesses need going forward?
JOANNE MURRAY: The most important thing a small business can have right now is cyber insurance. Since March, there’s been an increase of 300% in [cybercrime] claims, which are coming in with more people working remotely. As James said earlier, [many companies] may not have the security. Hackers are having a great time hacking into the small businesses, and it’s easy to do because they’re more vulnerable. So cyber insurance is really the one thing small businesses are lacking.
A lot of companies never purchased [cyber insurance] because they felt they were too small to be hit, or they couldn’t afford it, or they have an IT team [handling threats], or they had [backups] that you can use after you’re hacked. But you need to have the cyber-liability coverage in place to protect yourself when [a cybercrime] happens. Unfortunately, it’s more likely when a cybercrime will happen and not if it will happen, because it is definitely becoming a huge issue for small businesses.
So, what will the cyber liability [coerage] do for you? Cyber liability will help when you are legally obligated to notify your customers that your system was breached. Cyber liability products can also provide credit monitoring and repair, [help with] investigating how the bad actors infiltrated your system, and [help provide for] loss of business revenue. The last thing you want to do is pay the ransomware [malicious software that infects your computer] yourself, because now you’ve just given the bad actor access to your personal information, so you need to have insurance to protect you. Cyber liability covers first and third party cyber attacks. The insured, or policyholder, is the first party; third party is your clients who are impacted by the data breach. This is just something we can’t stress enough to our customers, the importance of adding this to your portfolio.
WH: Can you talk about the cost? Is this expensive? A lot of small businesses, like mine, are dealing with reduced revenue these days.
JM: For small businesses, it is not expensive. I urge everyone to talk to their insurance agent about the cost. You can buy what you need; it’s not a cookie-cutter agreement that says, “You have to have all of these coverages.” If you don’t need certain coverages, you don’t have to buy them. You can customize it to what you need and make it affordable. And when you get that customization from your agent, you can look at it and just pick out the most vulnerable situations for your business.
“If you don’t have to spend money, try not to, [in order to] weather the storm.”
– John Tolomer, President, The Westchester Bank
WH: This question is for Stacey: Knowing that in-person human interaction is not really possible these days, what can companies do to meet new prospects? We still need to market and sell our services; we always need new clients to sustain our businesses. Help us out.
STACEY COHEN: We are in an environment now where if we keep doing the same thing, we’re going to get stuck in reverse. In marketing, we talk about competitive advantage — truly the new competitive advantage now is about innovation and change. And when we look at the pandemic, it has created dizzying shifts in consumer behavior. Both small and large businesses really need to understand the changing needs of their clients and their customers and then adapt their communication strategies accordingly.
Another thing we all need to pay close attention to is that for the last decade, it’s been all about the Millennials. Now, there is a Gen-Z takeover: Gen Z is the cohort [born] between 1995 and 2010, and this makes up about 20% of the U.S. population, so we’re going to have to pay attention to these folks. They are the true digital natives, and they are the [most] racially and ethnically diverse cohort, so we have to really know how to market to them. Also, businesses need to reconsider their product or service offerings to better serve their target audiences, because the bottom line is about staying relevant.
The other thing is, we’re all craving this human-to-human connection, this networking, and, as businesses, [we need to figure out] how we can deliver more personalized experiences. An example is this Westchester-based law firm. I’ve been working with them for about 10 years; one of their main focuses was speaking engagements. Of course, [their planned speaking engagements] and marketing plans [for 2020] went out the window, so we quickly changed our strategy to virtual-education programs — a Facebook weekly livestream — and the results have been phenomenal. The great thing about these webinars is that they are all recorded, and to date, we have about 15,000 views.
Last but not least, we will see an increased focus on strategic partnerships and collaborations in 2021 rather than transactional relationships. All of us get that term I call “co-op-etition,” and it’s really a collaboration among business competitors, so they’re basically combining expertise, resources, et cetera, to really amplify their brands’ reach.
“Cyber insurance is really the one thing small businesses are lacking.”
– Joanne Murray, Owner Allan Block Insurance Agency
WH: One of the biggest reasons small businesses these days are closing is because of the shortage of cash coming into their businesses. What should small businesses do right now to best position themselves for success?
JT: As a general statement to the market, I would say: If you don’t have to spend money, try not to, [in order to] weather the storm. Secondly,have to be able to articulate what their plans are to generate some revenue, so they will be able to pay back any loans. So it’s really about examining your business [and figuring out] how [you will] reinvent your business now. Look at what restaurant[s] have done: In-house dining was prohibited, so they continued to do [takeout], and that became so important. Today, driving revenue is important, and while [new ideas] may be low margin, they can still be profitable.
And when you go to the bank [for a loan], explain the plan in detail. Banks make money when they give loans, not when they turn down loans, so there is a desire for banks to make loans and know they will be repaid. The businesses that say, “Hey, we’re in a pandemic. I’m strapped; I need help; give me some money,” that’s not going to work. But, if [they can explain]: “I’ve cut these expenses; I have another business line; here’s what I’m trying to do,” I think they have a very good chance. Those are the businesses that get loans.
SUSAN CORCORAN: I think a common theme that we’re all talking about is developing a preventive strategy. Whether it’s [figuring out] your plan in the cyber-risk area or making sure you have the right insurance or dealing with remote workers and making sure that we have the right plan in place [for remote work] and then later bringing those remote workers back into the workplace. It’s part of making sure that you’re continuing to think preventive in nature and proactive in nature.
JM: I’m really encouraged by the fact that businesses are trying to work together as a team. It’s no longer a “me” thing: You have to think outside the box; you have to look at your neighbors; and you have to come up with a team plan. Whether it’s the restaurants putting flyers in with their takeout that encourage people to use the retail in town or the retailers encouraging people to use the restaurants, there are so many ways we can all work together and network together. That’s an important message because if you try to operate [as though] it’s just your business, you’re not going to make it right now. We need each other, and I think that’s the one thing we’re all learning from this: to work better together