good advice is easy to come by when you have a “weather” advisory board. . .

ad•vi•so•ry

adjective
ədˈvīzərē/
having or consisting in the power to make recommendations but not to take action enforcing them.

Sometimes it is sunny for your business other times there is a storm on the horizon. You listen and many time look for weather advisories when a storm is on the horizon. Why would you not look for an advisory on the “weather” affecting your business climate.

Maybe your business is too informal or too small to establish a full outside board of directors. Nobody can build a great business alone, and whether it is a startup or an established industry leader, having access to high-quality advice will enhance your business’ odds of success. Businesses seeking advice can obtain it from a board of directors, consultants, or networks of one sort or another. Increasingly, many businesses from startup to mid-level are setting up advisory boards. This advisory group becomes a part of your team to assist in all facets of your business.

Remember this: to use an Advisory Board effectively, entrepreneurs and their management team must be open and frank with the Advisory Board, sharing both hopes and fears. They will not be able to advise you properly if you hold back or simply do not feel there is information you wish to share. You are only cheating yourself and simply voiding the concept of well-grounded advice.

You will want your Advisors composed of specialists, generalists or critical thinkers from diverse backgrounds can expose the positive or negative aspects of major decisions. Structuring your Board accordingly can provide a competitive advantage and help build your company’s visibility, credibility, and revenues.

Definition: A group of individuals who’ve been selected to help advise a business owner regarding any number of business issues, including marketing, sales, financing, expansion and so on; a body that advises the board of directors and management of a corporation but does not have authority to vote on corporate matters.

Advantages of an Advisory Board:

• An inexpensive alternative to a formal Board of Directors
• An inexpensive alternative to full-time consultants
• Provide a level of talent they a business could not normally afford.
• Support small businesses with skill sets not available in the company
• Provide support, talent and advice for entrepreneurs, startups and single owner businesses

Advisory Board Uses:

• Marketing and sales advice
• Gauging future trends
• Sounding boards
• Helping enter new businesses or new markets or product expansion
• Provide a set of “fresh eyes” for the your company

More Details on Advisory Boards:

An advisory board is an informal group of local business professionals who can help you run your business better. In addition, because advisory boards are unofficial (i.e., it’s not the same as a corporate board of directors), you have a great deal of latitude in how you set it up. Advisory boards can be structured both to help with the direct operation of your company and to keep you informed on various business, legal and financial trends that may affect you and your business

How many advisors do you need? Much depends on the size of your company and current personnel employed. Generally, you may want a legal advisor, sales, / marketing expert, a human resources expert and perhaps a financial advisor. You may also want successful entrepreneurs from other industries who understand the basics of business and will view your operation with a fresh eye. If you do not personally know people with those areas of expertise, do not be afraid to ask the most successful people you can find. At best, you will partake of the knowledge your community’s successful business leaders have. At worst, they will be flattered and say no.

When setting up the board, be clear about what you are trying to do. Let your prospective advisors know what your business goals are and that you do not expect them to take on an active management role or assume any liability for your company or for the advice, they offer.

Compensation for Advisors:Advisory board members can be compensated a number of different ways. Many are compensated with an annual small fee to compensate for their time and any travel expenses encountered for meetings. Other times it may be based upon the companies’ success or even success of a given project.

How to Hold Meetings: When holding actual meetings, you can go one of two ways: You can bring everyone together either every month or two, or you can meet with different advisors separately in a way that makes sense to the issue at hand. It really depends on your business’s needs, what you are comfortable with, and the dynamic you wish to develop between your advisors.

Summary:

Advisory boards can be extremely helpful and fulfilling, or they can be a waste of time. In the end, you get out of them what you put into their creation, development, and operation.

Now I would not be writing about this important topic if I did not want to help companies like yours. Feel free to contact me for a Free Consultation to discuss your situation. At the very least, I can provide some suggestions on how you can get started. Good business owners and managers know when to ask for help!

Bill Simmel