I’ve recently seen a very positive phenomenon — a number of business owners have asked for advice about forming advisory boards.
Is this a trend? I don’t know. But it’s good news because, done right, advisory boards can be a great asset to any company and its management team. Done incorrectly, they can be a major waste of time, energy and money. Here are four things to consider.
* Commitment. If you are not totally committed to having a board for the right reasons and to making the board a priority — including having an open mind to the board’s input and advice — then forget it.
* Choosing members for the right reasons. You are forming this board to help you, your management and your company grow. Choose your advisory board members as carefully and thoughtfully as you chose your management team. You want the best and strongest people, with experience and expertise in areas important to the company’s success.
Think about your strategies, your management weaknesses and experience and your growth plan. Pick people you trust and who share your ethical convictions. And there are people you don’t want — your attorney, accountant, banker, best friend, customer or competitor.
* Experience and leadership. Not everyone needs to have experience on advisory boards. However, seek out at least one person with extensive experience serving on successful boards. If that person is able and willing, appoint him or her as board leader. Make it that person’s responsibility to work closely with you to ensure the board provides the maximum return to the company. That person should help you define the board’s objectives, determine its mechanics and help the other members understand their role.
* Making it a priority
The best situations occur when the board and management team feed on each other. Management must follow though on all assignments from prior meetings and come to meetings prepared. Agendas, financials and other reports must be sent to members prior to the meeting, and detailed notes and action items should be taken and distributed afterward. Joel Strom ([email protected]) is director of Joel Strom Associates, LLC, the growth management practice of C&P Advisors LLC. The firm works exclusively with closely held businesses and their ownership, helping them set and achieve growth objectives while maximizing their profitability and value. Reach him at (216) 831-2663.