Your ‘Outside-the-Box’ A-team
Every business has its challenges, yet most private companies do not engage a board of advisors. So let’s look at your options a little more carefully to see how you might want to set up such a board. Creating an Advisory Board (BoA) is making use of a group of outside experts, in other words, an “A-Team outside the box”! I am playing a bit with words here, but I want to emphasize that you should try to think unconventionally and gain some perspective by adopting an approach that’s essentially “outside your business.” Have this group bring you business knowledge that you don’t currently have access to, information of the sort that will encourage profound questioning and probing.
An advisory board will provide you with non-binding strategic advice. This option gives you greater flexibility in how you might structure and manage this group than a traditional board of directors. Your selection of senior-level business leaders, experts and thought leaders to serve on your BoA will be very important. It might be easy to ask your accountant, lawyer or best friend to serve on your board, but that will be a mistake. A board with a completely outside perspective will bring you a refreshing new way to view your challenges and problem-solving, and get you out of your four walls to help you concentrate on working ON your business.
You’ll want to have high-level advisors who can advise you on all things business. Every one of them should have an appetite for forward-looking opportunities and bring a strategic mindset to the tasks at hand. The BoA should have a good cross-section of expertise, such as talent retention and acquisition, strategic finance, sales and distribution, leadership coaching and operations/productivity, to name just a few of your BoA’s skill sets.
Starting the process, you’ll need to focus on 4 steps:
- Selection of Advisors
You want advisors who complement your own skill set, but also understand the need to keep the conversation strategic and “big-picture.” Look for advisors who are excited about your business and industry and see in it the potential and opportunities.
- Commitment and Compensation
Decide what the rate of compensation for your BoA hires should be. For a lower middle-market company, make an investment based on the frequency of meetings. An advisory board member may earn between $1,000 – $5000 per meeting.
- Discovery Process
At the first meeting, introduce your company to the board. Give them a good background summary of how you have built the company, where you are today and where you may want to be in the next three years.
For the first meeting, draw up an agenda yourself. After that, the chair should create an agenda with specific action items for each meeting. Discuss deliverables in each session, whether they were achieved or not, and if not, why not. Based on that information, make appropriate adjustments and identify additional resources and support if needed.
Advisory board work is a long-term solution for your business and your executive team. View it as a long-term strategy to help ensure the future health of your company. The benefits of such an investment are that you gain access to a group of thought leaders and business experts who will brainstorm, help you define a better solution and add to your thinking power. If they are effective, they will hold you accountable for finding solutions and applying them to your business.
Several times in my work with business owners and CEOs, I’ve heard them tell me they don’t want to pay for “thinking.” I always tell them that while they might consider themselves as being very strategic and smart risk takers, having another set of brains on hand might just get them “outside the box” in terms of ideas and problem solving that will help them advance beyond their competition.
Developing an advisory board to support the future of your company is one of the best investments you can make, as long as the goals and deliverables are clearly stated and you see yourself and your company making progress. Never under-estimate the power of outside the box thinking and advising. You have an opportunity to assemble an A-team to help you sort out your priorities and challenges, all for a relatively small investment of $30-$75,000 a year. The return on this investment is a factor of many, not excluding the fact that you are becoming a true leader for your business.
Want to know more? Contact Rudi Scheiber-Kurtz for more details at 617-449-7728