Mill Brown is Managing Director of the Atlanta office of
Beane Associates, Inc., and a seasoned business professional
with over 30 years experience developing and implementing crisis
and change management for public and private companies.
Whether a business is poised to grow, trying to stabilize
itself or set a new direction, there are times when
it takes more than collaboration between the board of
directors and the top management team to make great
things happen. Sometimes, a business needs a new
perspective, an unbiased assessment by talented leaders
and executives who have a proven record of success
in their own businesses. In the case of distressed
businesses, continued fresh advice from outsiders may
be the key to a successful long-term transformation of
the company.
Unlike boards of directors, advisory boards don’t
have any power, but they can be influential agents of
change when CEOs recognize their value and are willing
to listen to their advice. A good advisory board will
suggest ways for a business to improve its operations
and its profitability, and will guide the business to the
resources—both human and financial—to make that
possible.
Where To Start
When choosing members of the board, remember that
you’re seeking individuals who will provide solid advice,
leaders who will take a fresh look at the company’s
issues, rather than offering instant agreement with the
direction the company is now taking.
A typical advisory board would include experts with
legal, financial and industry expertise, knowledge of
sound human resources and management practices,
and familiarity with any relevant specialties (engineering,
marketing, international, etc.), where the company
is inexperienced. Most owners and CEOs have the contacts
to recruit advisors with the appropriate expertise;
effective networking with other business associates
should provide candidates for any remaining positions
on the board.
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Structure
For most businesses, five to seven members are appropriate.
Your board should be large enough to bring
diverse knowledge and skills to the table, but small
enough to work closely together and reach consensus
easily. When your board is in place, schedule regular
meetings, with full agendas prepared and minutes
taken. In our experience, a quarterly meeting and an
annual session for strategic planning constitutes an
effective yearly schedule. Give the board full access to
the company’s financial information. Expect the advisory
board to deliver an honest and diverse perspective
on critical issues; empower the board to give you the
answers to tough questions confronting the business,
including the contributions of key management personnel
and how to improve performance to plan.
The Payoff
Whether management specifies the topics for the
advisory board to consider or gives it a broader rein,
recognize that a talented advisory team can suggest
moving the business in ways they hadn’t previously
been considered.
At the end of the day, that’s the benefit of having a good
group of advisors: they have the freedom to guide you
in directions you never thought possible, and they may
also point you to the resources you need to solve problems
and achieve new goals.
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