Advisory Boards: Who is Advising You?

One approach is to get advice from others. Good counsel can come from a friend with experience, an expert, or a business consultant. It can come from your team members through a little think-tank, or it can come from an assemblage of the right advisers who are committed to your success.

 

Many years ago I was on the Andersen Windows advisory board. This experience afforded not only a great opportunity to hear the wisdom of many other remodeling leaders, but it was also a chance to study advisory models that I since have been able to duplicate for other businesses and industries. The Andersen team created a theme: “Listen, learn, respond.” This simple phrase provided a framework for the group’s alignment and their accountability to ideas and insights. The following are some tips, misconceptions, and keys to success:

 

1)  You don’t have to be a big company to have an advisory board. Structure your board to be in sync with the scale of your business. 

 

2)  Having the right board members is critical. They may or may not be your friends, however, you do want them to be committed to your success. After you take inventory of your business goals, find the right members with the right acumen or expertise (i.e., financial, sales, or legal).

 

3)  Start small. An advisory board can change over time to stay in sync with the growth of the business. I think having a minimum of three board members is fine, but no more than seven to start. As the business grows you can add a board member or two based on the obvious needs of the business and the holes in the group. For example, you may want an HR guru on the board if you feel talent, culture, and team dynamics are a priority. 

 

4)  Set the right expectations. I always like to communicate what the board is “not” as much as what it is. Expectations include how you want the board members to look at the business, their remuneration, confidentiality guidelines, time commitments, etc. Don’t over-dictate at the beginning because the board will evolve and tell you what is the best way to proceed.

 

5)  The right cadence for board interaction is important. Some boards meet twice a year and some meet four times. Some boards have conference-call meetings between meetings and some do not. Depending on the circumstances, I would encourage starting with two or three times a year and then tweaking after the first year. One of the considerations is the amount of time needed to prepare for each board meeting, which may affect the frequency of the meetings.

 

6)  Board longevity is important. A great advisory board is like a fine wine. With the right blend it gets better and more valuable over time. Do not create an advisory board if you are not committed to this concept for at least three years. The best advisory board I sit on now has been together for more than five years.

 

Going it alone in this business environment can be scary. But a great advisory board can not only give you answers and reduce your mistakes; it also can give you the confidence you need to be successful. CB

 

Mark Richardson, CR, is an author, columnist, and business growth strategist. He authored the best-selling book, “How Fit is Your Business,” as well as his latest book, “Fit to Grow.” He can be reached at [email protected] or 301.275.0208.