Why You Need a Business Advisory Board
Having guidance from people who have been where you are is invaluable. An advisory board, or formal group of experienced business leaders, can make a lasting impact on your company. They are there to support you as you grow and can help you to find success through access to resources that would otherwise be out of your reach.
Why You Should Consider an Advisory Board
Recruitment, finances, strategy, marketing and business development are all areas of your business that could be positively affected by the introduction of an advisory board. The insights of these knowledgeable individuals can help to provide you with priceless advice that can save you headaches later on. As the advisory board is separate from your board of directors, they have no direct influence over company management and you have no obligation to follow their recommendations. They provide a low risk addition to your business that can help you to better understand your market, forecast future trends and build an ongoing strategy.
There are some drawbacks to consider, though. Finding the right individuals to make up your advisory board can be a time-consuming process and there may be some hesitation from your board of directors in sharing confidential or proprietary information with this group when they are not members of the company. There will also likely be some expenditure on travel and meal costs or compensation for attending meetings, to show the advisory board members that their time and input is appreciated.
Starting Your Advisory Board
Now that you have decided to move ahead with forming an advisory board for your company, here are a few tips on where to start.
Who to Invite
Advisory boards can range from only a couple of members to teams of 12 to 15. To get you started, consider inviting four or five individuals from a range of businesses and growing from there if needed. You will want to consider what the most pressing needs of your company are before sending out invitations. Study your industry and service market to find potential leaders in your field that may be interested in supporting you. Remember, the goal of your advisory board is to add new insights and connections to your business, so identify leaders who could do this for you.
Ask your most valued customers how they feel about the service they receive from you and what their needs are. Not only does this help you in identifying possible weak points in your business, but it can also give you valuable insight into the types of support you will need from your advisory board. Financial leaders can be useful individuals to have on your board, no matter the state of your business situation. A fresh set of eyes to advise and look over your records can be beneficial.
Similarly, lawyers and business consultants can provide unique perspectives on different aspects of your business that can hugely influence your decision-making moving forward. Executives from trade associations in your industry can may be good options for your advisory board too, as they often have access to resources specific to your field that the ordinary business owner likely will not.
How to Approach Potential Members
Making personal connections with the individuals you would like to invite is crucial. Be clear about your plans for your advisory board, what your company does and some of your ideas for growth. Let them know what level of commitment they would be expected to give if they choose to join and affirm the value you think they could bring to your team and business.
It is important that, even at this early stage, these leaders feel appreciated and highly valued. Offering term limits upfront, such as a one-year contract, can be helpful in making them feel included but that it does not need to be a long-term commitment for them.
Meetings and Preparation
Meetings should be scheduled quarterly if possible, with twice yearly as the minimum. Additional meetings can be scheduled if needed, particularly with individual board members whose expertise may be needed more frequently.
A key officer who will be attending the meetings should always prepare a brief agenda ahead of the scheduled time, organizing any materials that the advisory board needs to see and ensuring that they have plenty of time to review this before the meeting. The company CEO or owner should be prepared to make a presentation during the meeting on the status of the company, along with any progress reports from previous meeting action items and any ongoing needs that the business has. There should be plenty of time left for discussion following the presentation and to outline any action steps to be completed before the next meeting.
Starting an advisory board can be a beneficial step for many businesses, particularly those looking towards growth. Building strong connections with industry experts allows you to gain valuable knowledge and insight outside of your own company.
Contact the team at BSSF today for additional advice on how an advisory board could help support your business goals.