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Mergers and acquisitions are part of many businesses’ strategic planning initiatives, and to be carried out effectively, CFOs and board members ideally should be in alignment.

For many companies, though, achieving consonance between financial officers and board members who may have an incomplete understanding of the financial implications of M&A can be problematic. A recent survey by Deloitte identified the ways CFOs and boards end to diverge and provided some suggestions for gaining the buy-in and cooperation necessary to enable M&A deals to proceed smoothly:

* Ensure the CFO clearly and thoroughly communicates the potential future risks and benefits associated with an M&A, including risks and benefits associated with the diversification of products and markets, and then relates or “ranks” them against each other to demonstrate the level of risk that’s potentially involved. Seeing risks and benefits in relation to each other can help non-financial experts understand the tangible value of a proposed M&A deal.
* Understand that CFOs may be more “friendly” to the idea of accruing debt to complete M&As and other deals than many directors. When necessary, CFOs should be willing to describe the benefits of assuming debt rather than depleting cash resources when an M&A offers significant value to the company. Again, a comparative measure of return can help board members relate to the potential advantages of an M&A or other deal.
* Board members should be assessed for their willingness to embrace risk and to become better educated about risk-benefit analysis, and opportunities to improve understanding and facilitation of M&A deals should be evaluated and implemented.

By working together, directors and CFOs can create value and promote growth. If an M&A deal is in your company’s future, helping these two influencers to align more closely can help ensure you maximize your company’s ROI while minimizing its potential risks.

For most businesses, adding new technology comes with more than just the upfront monetary cost. New technology usually involves a learning curve during which time operator errors tend to be high and efficiency drops off. It’s also a time when your business can be exposed to greater risks. Why? Two primary reasons: As noted, unfamiliarity with equipment can lead to errors that can leave you open to unexpected loss or damage; and at the same time, employees’ and managers’ attention is diverted from “normal” routines and focused on adapting to the demands of the new technology.

Every business needs to upgrade technology from time to time. So how can you make the transition without exposing your company to elevated risk? By incorporating risk management into every phase of the upgrade, from the purchasing decision to training and final implementation.

Here are some tips:

* Plan carefully. Many companies plan based only on cost and features. Instead, consider the human impact including the learning period when risks can be at their highest. Consider ways to decrease the curve or speed-up the learning process, or have a mitigation plan in place.
* Consider hiring a technology consultant or ask if your supplier offers a training program or any guidance with planning and implementation.
* Allot additional resources during training to ensure more focus is placed on identifying and managing potential risks. Hopefully before they occur.
* Implement a reporting system that allows you to monitor implementation and track progress so you can anticipate risks during both current and future technology upgrades.
* Make sure to upgrade your risk management plans, operational procedures and insurance coverage as needed to reflect the upgrade.
New technology can help your business grow and stay competitive. Just be sure to plan carefully to minimize your company’s risk exposure during the transition period.

During the next few issues, we’ll be looking at some ways to help you manage risk and save costs by making smart decisions about your insurance. Let’s get started:

* Choose deductibles wisely. Since a higher deductible usually means a lower premium, you want to hit that “sweet spot” where the deductible you choose balances your risk profile. Don’t choose a deductible that’s so high, it could have a negative financial impact in the event of a loss; but don’t choose one that’s lower than you need based on the risks your business faces, either.
* Make sure your property values are in line with policy limits. Have you purchased new equipment or upgraded your facility, or perhaps scaled back in some way or made improvements that could lower your premium? Make sure to let your insurance company know about changes in your property value or additions like an upgraded security system to ensure you have the right amount of coverage at the best possible rates.
* Know your loss ratio. Your loss ratio is determined by dividing the annual premium that you pay by the amount of any claims you’ve made in the past year. Most insurance companies look at loss ratios for the past several years when determining risk. A lower ratio means less risk, and that means lower rates and better deals for you. Knowing your ratio can help you prepare for rate increases and it can also help you negotiate for lower rates when your ratio is favorable.
* Plan for price shifts. Like other commodities, the cost of insurance is cyclical, and if your rates have been low for a few years, there’s a good chance they may go up in the near future. Avoid “sticker shock” by budgeting at the high end of the market so you’re prepared for potential price increases.

Look for more tips in next month’s issue.

Last month, we looked at some of the less common strategies hackers and other online criminals use to gain access to business’s accounts and steal data and personal information. In this month’s issue, we’re looking at some hacking prevention tips provided by the FBI:

* Make sure your computer system uses multiple layers of security to help would-be thwart attackers.
* Use the highest security settings on social sites and ideally, restrict access to social sites at work to only those who must use them, such as marketing personnel or managers.
* Make sure firewalls and anti-virus software are updated and enabled on all systems.
* Provide annual training in online security and educate employees about what company information they may and may not share.
* Make sure employees change passwords regularly and do not use former passwords.
* Monitor dataflow on your network at all times and respond to potential threats or risky employee behavior immediately.
* Implement a reporting system where employees can notify managers about potential threats or risks such as phishing or pharming.
* Review prior threats, risks and losses and develop and implement plans to avoid incidents in the future.
* Develop a robust BYOD policy and make sure to enforce it.
* Make sure your employees do not use work computers to access personal accounts or networking sites.

The Internet is an important tool for most companies today, from small companies to major corporations. In fact, for most companies, it’s hard to imagine operating without some sort of online presence. While virtually any business activity can pose potential risks, smart businesses work hard to establish protocols to identify potential risks so they can be avoided and, if unavoidable, mitigated. Implement these strategies from the FBI to help decrease your risks when using the Internet in your business.