A good board of directors can be a great support for a top executive regardless of company size. The most common type of board offers advice; however, other boards act as fiduciaries, which have legal liability for the company’s practices – and thus are much more actively involved in overseeing the company. In either scenario, before establishing a board of directors, a small business owner needs to be clear about why he or she wants a board and what the owner is prepared to do to get maximum value from a board.
These steps can help with developing your board of directors:
1) Get prepared. Write down what you want them do, how much time they will need to commit monthly, how long you want them to serve, where you and the company need the most advice, and what are you willing to provide as compensation to board members – if anything. Many nonprofit boards don’t offer payment beyond lunch, but for-profit entities typically provide a quarterly stipend or payment.
2) Choose broadly. Many business owners draft friends and industry colleagues to sit on their boards initially. However avoid picking carbon-copies of yourself. Look for board members with diverse backgrounds and perspectives. It is useful to have board members from a wide range of fields, including legal, finance, accounting and marketing. Organizations such as the U.S. Small Business Administration’s SCORE program of retired business executives and The Alternative Board can connect groups to potential board members.
3) Orient the board. While board members may be familiar with your organization or products, they may have only a broad understanding of your operations. Therefore, it may be useful to provide orientation for incoming board members to cover organizational structure, functional duties for each division and division head, a brief description of each product/program/service that includes its target market, as well as pie charts that display major revenue streams and expenses.
4) Share authority. Many entrepreneurs conceive and build a company according to their liking and their understanding of the customer. Owners and managers should run the day-to-day operations in alignment with the board policies. A good board will encourage the development of processes for rationally researching, analyzing and assessing all aspects of the company. Moreover, few board members want to give up their time to meet to essentially rubber-stamp every executive decision.
5) Reassess your board periodically. What you need today to help your business flourish may not be what you’ll need in three or five years. As you periodically conduct mid-term strategic planning, you should review the skills and resources presented by each board director in light of where you want to take the company. Don’t be afraid to disband and redesign your board.
Patricia Adams is the CEO of Zeitgeist Expressions and the author of “ABCs of Change: Three Building Blocks to Happy Relationships.” In 2011, she was named one of Ernst & Young LLP’s Entrepreneurial Winning Women, one of Enterprising Women Magazine’s Enterprising Women of the Year Award and the SBA’s Small Business Person of the Year for Region VI. Her company, Zeitgeist Wellness Group, offers a full-service Employee Assistance Program to businesses in the San Antonio region. For more information, visit www.zwgroup.net.
The beginning of a new year often comes with a sense of endless time and possibilities. We often make aggressive business plans for many months out and then wait to execute because we have so much time.
Every small business owner knows time can easily get consumed by the daily running of the business, leaving you with a well thought out plan that never materializes. As you start the year, now is the time to schedule business coaching sessions with someone who will energize you into action or renewed action on a regular basis. To get the most out of your coach:
Identify the right coach for you. Successful business owners focus on continual innovation to remain competitive. They often seek out and rely on advice from others who are more knowledgeable than they are. Similarly, you should seek a coach who has experienced what you are facing and who has triumphed. In business, they are often outspoken, leaders in industry and trade associations or policy researchers in government and university settings. In life, they are frequently counselors, pastors,and retired volunteers in non-profits organizations. By selecting a coach that fits your need, you are more assured your coach will impart guidance that is based on real business experiences.
Set a goal for each coaching session. Good mentors are invaluable and often in high demand. Decide which one to two items you want to address for each meeting. Determine what one key question you want answered on each topic in advance of the meeting. By being prepared, you will show your coach that you value his or her opinion and time, and you will find your coaching sessions are more productive and useful to your own business plans.
Reach out before you face a crisis. The best way to avoid a calamity is to head it off when possible. Call your coach as you see potential changes developing to strategize on how you might handle the changes, if necessary. Some of the best new ideas come from free-flowing discussions and debate about possible solutions when there’s no pressure to show immediate results.
Periodically reassess your coach. As seasons change, so do family, work and professional relationships. A good coaching relationship offers ongoing useful guidance. If your coach has provided all the support he or she can and seems to be recycling the same messages, consider whether you need to pay closer attention to your coach or if it is time to find a new advisor.
A successful coaching relationship requires careful preparation and opening yourself to critiques. But it is an investment that can help steer your business to greater profitability, exposure and success in 2012.
Patricia Adams is the CEO of Zeitgeist Expressions and the author of “ABCs of Change: Three Building Blocks to Happy Relationships.” In 2011, she was named one of Ernst & Young LLP’s 2011 Entrepreneurial Winning Women, one of Enterprising Women magazine’s 2011 Enterprising Women of the Year Award and the SBA’s 2011 Small Business Person of the Year for Region VI. Her company, Zeitgeist Wellness Group, offers a full-service Employee Assistance Program to businesses in the San Antonio region. For more information, visit www.zeitgeistwellnessgroup.com.