Objective of Your Advisory Board: Advisory
boards can be general in scope or targeted to specific markets,
industries or issues such as adopting new technology or going global.
They provide timely knowledge about trends and competitors, as well as
identifying upcoming political, legislative and regulatory
developments. They can help you enter new businesses and look at your
own operations with an open mind. Advisory boards can also be made up
of customers and prospects who provide insights into product
development and marketing issues.
Right People: Of
course, when forming a board you need to understand its purpose, but
you also need to know what specific skills to seek. In general, look
for diverse skills, expertise and experience. You want members to be
problem solvers who are quick studies, have strong communications
skills and are open minded.
Big names can be a bonus ... but not always: Getting a heavyweight on
your board of advisers can give you credibility, but itís also
important to have members who are going to spend the time to give you
thoughtful advice or are well connected and willing to make
When inviting a prospective member to join your advisory board, you
should lay down the ground rules about what is expected in terms of
time, responsibilities and term of office. Specify the areas in which
youíre seeking help. If the advisory board is going to discuss
issues that include private information, members should be notified
that they will be asked to sign a confidentiality agreement.
Your Advisory Board: Depending on whom you are asking
and how involved you need them to be, compensation can vary from just
providing food to covering expenses to stock options to cash payments
to a combination of the four. Keep in mind that your members will
likely benefit themselves in a variety of ways. Being on your board
will expose them to ideas and perspectives they may have otherwise
missed. It will also expand their own networks and provide them with a
way of giving back.
||Get the Most
Out of Advisory Board Meetings: Prepare for
meetings well in advance. Choose a site that is comfortable and free
of distractions. Careful thought should be given to developing the
agenda and managing the meeting. Solicit input for the agenda, and
distribute important information ahead of time. Run the session as you
would any professional meeting, and follow it with an action plan. The
facilitator should know which experts to draw out and how to stimulate
a dialogue. He or she should be result-oriented, as ideas without
action aren't worth much. The minutes should be written up and
circulated to top management. The notes should include recommendations
on key issues.
An advisory board must be open and frank, so donít be offended if
you hear things you donít like. Your board will also suggest ways of
correcting the problems they identify.
If appropriate, encourage members to tell you about their mistakes
so you can avoid making the same ones. You can learn a lot by finding
out what other people did wrong.
Alternative Feedback Methods: Getting the entire board
together on a regular basis may not be possible. Instead, meet or have
conference calls with specific members about topics relevant to their
expertise as needed. E-mail is a great way to reach everyone and have
them respond to you at their convenience.
abuse or waste their time. Listen to what the board says. Sometimes, a
business executive is so close to an issue, you canít see the forest
for the trees. But remember: This isnít a corporate board, so you
don't have to do everything they suggest. Ask yourself, ďDoes this
work for my company? Am I comfortable with that?Ē Then make a
Members Informed: Once
theyíre on the board, keep members excited about your business by
giving them updates at times when you aren't soliciting their advice.
The fact that they've agreed to be on your board means they care about
your company, so keeping up-to-date will help them be of greater value
to you. Remember that these people are evangelists for the company.
||Fire Bad Board Members: If you realize youíve made a bad choice, get
rid of him or her. Unlike a board of directors, advisers can be
replaced without a lot of legal headaches.