Good news for business owners looking to grow Aug 20, 2015, 8:11 am By Heidi Carmack Pfaffroth

Guest post by Richard Gray

A bill was approved a few weeks ago on July 28 to increase the loan limits for the Small Business Administration 7(a) loan program for the fiscal year. The program authorization ceiling was increased to $23.5 billion from $18.75, which the program already reached earlier in July. The same afternoon the bill was approved, the SBA was back to processing loans under the 7(a) program.

This is big news for small-business owners who want to grow their business. After the program loan limits were reached on July 23, new loan applications were placed on hold and small-business owners and lenders were told no new applications would be approved for financing until the new fiscal year, which begins October 1, 2015. The fast approval on increasing the limits means that small-business owners can again be approved for financing.

I know the value of SBA loans for small-business owners in our community. I help local small-business owners to get financing to start or grow their businesses. For more than 25 years I have been able to watch as people are able to move their dreams forward because of SBA loans. There are small-business owners here in our community with great ideas and solid businesses but may have less cash for a down payment than lenders usually require, have a short operating history, require a longer-term loan than lenders usually provide or need financing for very specialized equipment or unusual financing needs. Many of these small-business owners have been able to get financing through SBA loans. The 7(a) program is the SBA’s primary and most flexible loan program.

President Barack Obama electronically signed H.R. 2499 into law the morning of July 28, effective immediately. Reopening the 7(a) loan program was so urgent that the president, who was out of the country, authorized the use of the autopen for only the sixth time during his presidency.

The quick action by Congress and the president shows how important the SBA loan program is to the small-business community at large and the economic impact of small business to the economy. Business owners looking to grow will be able to take advantage of the SBA 7(a) loan program, which helps creditworthy small businesses to get financing.

The SBA welcomed the action by Congress to increase the authorization ceiling that would “[allow] the SBA to continue supporting American small businesses as they grow and create jobs to strengthen the nation’s economy,” according to the SBA website.

“Because of the swift decisions of Congress and the president, the short-term lack of funding for the program should not affect or impede to the capital necessary for small-business owners,” said my colleague Aga Merx, an SBA department manager for Bank of American Fork.

Despite the short suspension of the program, demand on the SBA 7(a) loan program this year was unprecedented, proving that U.S. businesses are growing. The amount already approved a week prior to when the program reached its loan guaranty limit was a 25 percent increase over the same period last year. The SBA has approved more than 45,000 loans that total more than $16.5 billion.

The SBA 7(a) loan program was designed to help expand access to capital for small businesses, and its success in doing that created a stronger demand than what the SBA was prepared for.

The Office of the Comptroller of the Currency explains how the 7(a) program operates:

“The program helps creditworthy small businesses acquire financing when they cannot otherwise obtain credit at reasonable terms. The program covers business borrowing requests in which the business has sufficient cash flow to repay the loan but may not have the necessary collateral or history required by a bank’s lending policy.

“The SBA does not provide funds to the borrower. Instead, the SBA guarantees a portion of the lender’s loan, which is conditional based on the lender following certain requirements established by the SBA. If the borrower defaults, the SBA pays off the guaranteed portion of the remaining loan balance. This conditional guaranty covers a portion of the risk of borrower repayment default.”

Small-business loans are critical to helping keep communities growing and people working. The SBA 7(a) loan program is an excellent program for many small-business owners in obtaining financing to start or grow their business. Despite the concern felt by many when loan applications were put on hold, reaching the limits shows that small businesses are growing and the quick approval of increasing the limits shows that many government leaders place value on small-business growth.

Richard Gray is senior vice president of SBA lending at Bank of American Fork, Utah’s community bank leader, an Equal Housing Lender and Member FDIC. Richard has assisted local small businesses in obtaining SBA funding for more than 25 years. He served on the board of directors for nonprofit Kostopolus Dream Foundation and was the chairman for nonprofit Utah Microenterprise Loan Fund, Salt Lake City.

Apple Pay update Aug 19, 2015, 10:49 am By Heidi Carmack Pfaffroth

We anticipate being able to offer Apple Pay in early 2016.

We have been pursuing Apple Pay™ with our credit and debit card processors—we have told you before that we’re excited about Apple Pay. We anticipate being able to offer Apple Pay processing during the last quarter of 2015 or the first quarter of 2016.

This is a later date than we were hoping to be able to offer Apple Pay and we’re sorry for any inconvenience this may have caused.

In order to offer you Apple Pay, we have to make sure we have our applications and networks ready and the vendors we offer credit and debit cards through have to be ready. We are ready. We have been working hard to make sure we can offer the most important technologies, as a part of our pattern and commitment to innovation. However, our vendors aren’t ready—we are making a change with a vendor and another vendor is beta testing Apple Pay with some clients.

We will keep you updated. We are excited about this product and we care about the products that will make your financial life easier. Feel free to call 800-815-BANK with questions, comments or concerns, or leave us feedback at www.bankaf.com.

Apple Pay is a trademark of Apple, Inc. The Apple logo, Apple, iPhone and Passbook are registered trademarks of Apple, Inc.

Why was Utah just named #1 Best Economic Outlook for 2015? Aug 17, 2015, 3:07 pm By Heidi Carmack Pfaffroth

Utah recently earned the top spot for states with the best economic outlook, according to the new edition of Rich States, Poor States released by the American Legislative Exchange Council.

 http://www.alec.org/publications/rich-states-poor-states/

 

This economic outlook is meant to be a forward-looking measure and ALEC uses 15 areas they have determined to be the best determinants of economic success. The measure is meant to show how each state can expect to perform.

We love Utah over here at Bank of American Fork. As community bankers, we get to help local business owners to finance their dreams and grow. We find that our customers are hard-working, ambitious and intelligent.

What else do you think makes Utah’s economy and business owners successful?

Why Your Corporate Training Curriculum Must Include a Wellness Program Aug 10, 2015, 9:32 am By Heidi Carmack Pfaffroth

Guest post by Richard H. Tyson, CEObuilder

My most recent article focused on the importance of competency training to assure operational effectiveness and efficiency—which, in turn, create positive customer outcomes and generate financial success. Competency, however, is only one leading indicator that drives operational success. There is a second, equally critical driver: the health and wellness of your people.

Clearly, sick or injured employees cannot deliver 100 percent of their competency. Even if they show up for work, they generally drag through the day, creating a fraction of the value they would give if they were well. And obviously, if they are absent from work, the problem is exacerbated.

Recent data provided by the Centers for Disease Control shows how significant this is. For every 100 workers in U.S. corporations, 65 are overweight, 33 have high blood pressure, 27 have heart disease and 10 have diabetes. These conditions are not mutually exclusive; many employees have two or more of these conditions.

Over time these issues lead to long-term health crises, including premature death. In the short term they regularly zap the productivity of individual businesses and the economy through absenteeism. It is estimated that about 2.5 percent of the American workforce is not at work on any given workday due to unscheduled absences. Even more significant is what has become known as presenteeism, or attending work while sick. 

A 2004 Harvard Business Review article “Presenteeism: At Work—But Out of It” popularized the term. It referenced a study of worker productivity at Lockheed Martin Corporation, which found that employees who came to work with common ailments, such as back pain, arthritis, headaches, colds, flu and allergies, cost the company $34 million in one year. The article reported that presenteeism from these ailments can cut individual productivity by one-third or more. 

What is the best strategy for reducing the impact of both absenteeism and presenteeism? To discover that, we must examine the root causes of the ailments that contribute to these issues. Fortunately, the CDC has also documented some of the more significant causes. They include smoking, unhealthy nutrition, sedentary lifestyle, high stress and depression. Any strategy that significantly reduces absenteeism and presenteeism must address these causes. 

A 2014 Rand Corporation study found that wellness programs aimed at reducing health risks, such as weight control and stress, saved 48 cents for every $1 spent, taking into account the impact on both healthcare costs and absenteeism. Savings were even higher when programs were focused on high-risk employees with multiple risk factors and chronic disease. 

As important as the financial impacts is the profound effect on worker perceptions. Healthways, a well-being improvement company, has developed a Well-Being Assessment it tracks with the Gallup organization. The WBA assesses well-being at the individual level. The assessment was recently completed by about 20,000 employees in three large companies. Those who said it was difficult to exercise or eat healthy at work proved to be twice as likely to have high presenteeism, as did those who said their company had little interest in helping employees become physically active. Those who said their employers did not support them emotionally were over four times more likely have high presenteeism. 

The implications of these studies are clear: companies that want to be operationally effective and efficient must provide not only strong competency training and metrics but also health and wellness programs to assure employees are minimally impeded by physical or emotional ailments. Companies that actively engage in the health, nutrition and life balance of their employees reap substantial improvements in productivity and profitability through reductions of both absenteeism and presenteeism.

Small companies often find it difficult to implement an effective wellness program. The good news is that expert resources are available. Corporate Wellness by Vasa Fitness is one of the best here in Utah.  Its consultants assist in setting up programs for businesses, small and large. They establish baseline metrics, including weight, blood pressure, BMI and cholesterol levels, against which the progress of each employee is tracked. They also help in setting corporate incentives that are HIPAA compliant.

Corporate wellness is yet another important element of a strong open-book management system. Not only does it represent another link in the chain of desired business outcomes, it is also a strong leading indicator driving morale and workplace satisfaction.

Richard Tyson is the founder, principal owner and president of CEObuilder, which provides forums for consulting and coaching to executives in small businesses. For 22 years, CEObuilder has successfully brought about an outstanding financial return for CEO and executive clients through providing leading-edge content in the areas of strategizing, team-building, problem-solving and managing for results, as well as the use of proprietary learning and coaching models.

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How Michelle helped protect herself from fraud Jul 23, 2015, 7:20 am By Heidi Carmack Pfaffroth

Michelle, a Bank of American Fork employee, received a text alert about a zero dollar amount transaction on her debit card from retailer Amazon. Since Michelle only uses her credit card on Amazon, she knew right away it was a fraud attempt. She quickly had her card blocked to protect against any additional fraud attempts and filed a claim for the fraud against her.

Even though Michelle checks her transaction history regularly and feels she would have noticed the fraudulent transaction soon after it took place, she was glad she had signed up for smsGuardian™, a text alert service through Bank of American Fork that alerts customers to certain types of transactions. In her case, smsGuardian picked up on the zero dollar amount.

Here’s how you can help protect yourself with smsGuardian. When you sign up, you will receive text alerts that will alert you to certain transactions being conducted using your Bank of American Fork VISA® debit card via alerts to your mobile phone. Once enrolled, you will receive a text message each time your debit card is used for: international or out-of-state debit card transactions, purchase authorizations greater than $200, five or more transactions within a 24-hour period, card purchases where the card is not present and many other types of irregular transaction behavior. You can enroll by visiting www.bankaf.com >Products >Personal >Bank cards. On that page you will find a link to sign up for smsGuardian alerts.

After hearing Michelle’s story, I signed up for smsGuardian. It took me less than five minutes.

*Amazon, Kindle, Fire and all related logos are trademarks of Amazon.com, Inc. or its affiliates.

smsGuardian is a trademark of JHA Payment Processing Solutions, Inc.

Creating a password that’s secure—and memorable Jul 06, 2015, 8:01 am By Heidi Carmack Pfaffroth

Guest post by Quincy Fowler

You have probably read recent news about security breaches. Passwords are stolen and online accounts compromised. Online safety is a top priority for everyone who uses the internet for financial transactions. A strong password can help protect you online. Many people are under the impression that a strong password will be difficult to remember. There are effective techniques for creating a strong and memorable password that is difficult to guess by those close to you and by strangers who would want to either figure out your password through social engineering or various decryption methods.

One of the hallmarks of a strong password is the inclusion of special characters to prevent a person from creating a program to guess using standard dictionary words or letters in a random order. The old advice of using a pet’s name or birthdate is simply outdated and dangerous in this age of advanced computing power. In order to create a strong password, you should consider making up a sentence that is easily remembered, but long and complex enough to make it challenging to guess. After you create the sentence, use the first letter of each word to write your password. Include numbers in the sentence and incorporate them with digits. Finally, use any punctuation that may appear in the sentence. In addition, use some special characters such as the ampersand (&) or the “at” symbol (@) in place of letters or entire words as appropriate.

For example, if I chose my sentence to be “The quick brown fox jumped over the 2 lazy dogs”, my password would wind up being Tqbfjot2ld. Most people would be unable to remember this password without context, but I, the rightful owner of the password, would have context to help me figure it out if I forget. Think of your password as the key to the vault door of your online bank account. You want it sufficiently complex that a skeleton key won’t allow unauthorized access.

Quincy Fowler is one of our customers who has years of IT experience—and even more years of creating, forgetting and learning to remember passwords!

How to prepare for a business loan Jul 02, 2015, 8:12 am By Heidi Carmack Pfaffroth

Want to plant the seeds for a successful loan application? Check out this graphic for some ways you can prepare for a business loan.

Questions? Ready to apply? Call 800-815-BANK or contact a business banker.

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Some of the best types of online tools to save you time Jun 25, 2015, 8:20 am By Heidi Carmack Pfaffroth

Especially in a small business, when employees and owners are often wearing many hats, it can be hard to keep up on everything that needs to happen while also improving efficiency.

Here’s one more idea you might want to consider: Are there financial tasks you can take online?

It can be difficult to relinquish control when you’re a small-business owner—small mistakes can have big costs and the success of your business means everything to you. However, you may want to consider the ways you could improve efficiency by unloading a few tasks, or even one, to an online system that is safe, secure and easy-to-use.

A recent study of more than 800 small business owners showed that 66 percent of respondents said they were likely to switch banks for a superior mobile offering for business accounts. While many small business owners struggle to know where to give up control, numbers show that you’ve probably at least thought about online and mobile solutions for your business.

Below are some ideas for types of tasks you may be able to take online that could have a big impact on your time. If your banker hasn’t offered these tools, make sure you ask, because you might be missing out on some time-savers.

Online business banking. One of the most basic things you can do is sign up for online banking and get help from your financial institution in creating an online account. Having real-time access to your transactions and other account services online can save you time and energy—instead of waiting for all your papers, receipts and documents to come in so you can reconcile, you can keep track using the internet from any location at any hour, day or night. Most likely, your financial institution will also allow you to do things like transfer funds, send ACH pay to employees and send money by wire transfer. Since more than half of small-business owners work more than 40 hours per week, you’re probably working when your bank is closed. With online banking you can get more done, when it works for you.

You might also consider finding out if you can grant customized account access to authorized staff, to make sure you have checks and balances within your organization.

Non-analyzed ACH and wires. Non-analyzed ACH or wires provides small-business customers who send minimal wires or process few ACHs the ability to send wires and initiate ACH items using online business banking. Once you learn how to use this service that is likely offered in your online banking, you can save time and money by paying your employees from home.

Bill pay service. Do you use a bill pay service for your personal bills? This simple service may be available for your business banking, allowing you to make payments via the internet to any checking account without writing a check. You can schedule payments you know you will have due, and have payees ready for other payments that are more variable. Then, when you need to track incoming invoices or bills, you can login and look at your payment history. If you have an online login for your business banking account, you can likely set it up directly from there.

Fraud protection for business. Some financial institutions offer fraud protections unique to business customers, since different types of or volume of transactions may require unique protections. Ask your financial institution if they offer a service that ensures that they checks they write are cashed by the correct parties or if they offer downloadable software that will help protect their computer from hackers that try to steal online banking information. These are a couple of the services I usually offer to business customers, and your financial institution might also.

Remote deposit. One way you might be able to save time is with remote deposit of checks. Look for a service at your financial institution that allows you to remotely capture checks with your mobile device. You may be charged a fee, so weigh the cost of the fee with the cost of your time and travel to deposit in a bank. You may find that the cost savings in your time is worth the cost of the associated fees. You might also consider a remote deposit product that allows you to scan checks with a small scanning device and make deposits from any location. It is likely that you can save some time and expense with some type of remote deposit service so make sure you talk to your banker about the options that could be available.

Accept online payments. One easy way to save time for small businesses, non-profits and other organizations is to accept online payments or donations directly from a customer’s bank account or with bank cards. This is ideal for organizations that do have access to or the need for an online shopping cart but want to provide the convenience of online payments or donations for their customers. This may benefit business owners and managers by improving your cash flow because of timely deposits. While you might not need a whole suite of online payment systems, even having a way to accept a smaller number of payments could save time.

While setting your business up to use online tools might take a small investment of time at first—to find out what your financial institution offers and learn to use the tools that will be valuable for you—you’ll likely save more time in the end. If you’re looking for a way to improve efficiencies in your organization, consider how you can take a few time-intensive financial tasks online.

Employee Competencies Drive Operational, Customer, and Financial Success Jun 18, 2015, 8:53 am By Heidi Carmack Pfaffroth

Guest post by Richard H. Tyson, CEObuilder

Guest blogger Tyson is starting a series here about open book management. Make sure you check back for additional articles!

The reader of my last several articles may well wonder how far I intend to extend open-book management. To date, I have suggested that open-book management should encompass financial, customer and operating metrics. The operations, processes and/or systems of any business drive the outcomes experienced by customers—and customer satisfaction (or the lack thereof) drives financial outcomes.

The question I now raise is: What drives operational effectiveness and efficiency? Since, in almost all cases, people run the operations of business ventures, it is safe to say that people are responsible for the success or failure of any system or process. It is imperative, then, to thoroughly train employees to perform the operational tasks of the business in an exemplary way.

Operational competencies of an enterprise’s staff are leading indicators which create the lagging indicators embodied in operational metrics. Open-book management should, therefore, include “competency measures” that demonstrate each employee’s ability to perform the tasks that will effectively and efficiently deliver the outcomes desired by customers, who will, in turn, spend their cash for those outcomes.

Unfortunately, most small businesses (and many larger ones) do not adequately train their employees, much less test for and measure their competencies. The most common training method is what I call “training by osmosis.” This approach places new hires with experienced individuals, to whom they are to “pay attention.” After a day or two of being exposed to this expert, they are deemed ready for prime-time! Sadly, too often this newbie is set up for failure, having little or no sense of real competency (Editor’s note: For training help, see Ken Burnett’s series).

For manual tasks, I recommend a substantially modified version of osmosis training. It is referred to as See-Hear-Say-Do. The first step is simply to observe the experienced employee performing the task. Questions may or may not be asked by the newcomer at this point. Next, the trainer repeats performing the task, this time stating aloud each specific element that constitutes the full process. The new employee listens and observes with an intense focus on what is being done. The third step engages the learner by having him/her tell the experienced employee what to do, step by step. The trainer will proceed to perform the task only when the instructions given are correct. The trainer will prompt the learner where necessary to assure that understanding has been achieved. The final step requires the newcomer to actually perform the task, while repeating aloud each step.  

The process of seeing, hearing, saying and doing exposes the learner four times to the task and its inherent processes—and engages the senses of sight, hearing and speech, thus increasing recall and competency. This process should be repeated on at least a daily basis over a period of time until all measures of effective and efficient competency are assured.

For cognitive tasks, the principles that drive operational tasks must first be understood. Interactive teaching that engages the learner and allows them to paraphrase what they have learned is best here. Once this understanding is achieved, training should focus on the specific application of the principles taught in the context of the business. This can often be best accomplished using case studies of real experiences in the business. Having shared these applications of key business principles, learners should make a firm commitment to applying what they have learned, followed by a series of training experiences, which may be administered through case studies or real job situations. These experiences should then be followed by a careful review and critique by trainers regarding the new employee’s ability to perform the cognitive tasks desired. The process should be repeated until competency is assured.

In all cases, training should begin with the end in mind. All employees should understand—and be able to discuss in their own words—the linkage between financial, customer and operating outcomes and their own competencies. Owners, CEOs and other executives must recognize that the metrics which assure employee competencies are among the most important key performance indicators in any company. When these recognitions are firmly in place, the probability of business success increases considerably.

Richard Tyson is the founder, principal owner and president of CEObuilder, which provides forums for consulting and coaching to executives in small businesses. For 22 years, CEObuilder has successfully brought about an outstanding financial return for CEO and executive clients through providing leading-edge content in the areas of strategizing, team-building, problem-solving and managing for results, as well as the use of proprietary learning and coaching models.

How to help protect your money and get the support you need as you age Jun 15, 2015, 8:51 am By Heidi Carmack Pfaffroth

It’s World Elder Abuse Awareness Day. Something you can do? Share this graphic to spread the word about an effective way to help combat fraud against seniors.

If you’re thinking about fraud against seniors (up to $1 million a day here in Utah!) but aren’t sure how to protect yourself or your loved ones, start with some simple, but effective ways to put checks in place and combat different types of fraud. Seniors can maintain independence and still have a helper looking out for fraud with all or part of the account structure suggested in this infographic. Share the graphic online or, for a printed version, call 800-815-BANK.

 
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