By Cathie Ericson
What if you could snap your fingers and have all the answers you need to make your small business a success without wasting time or money? Guess what? There actually is a secret weapon that can help you skip what doesn’t work and get to the “success” part faster. And that’s having a board of advisors that can help you challenge assumptions, drive sales, recruit top talent, and more.
“Small business owners only see things from their limited perspective, and while this tunnel vision might help when it comes to what they deliver to the marketplace, it hurts them when it comes to operating a business and competing,” says George Athan, a business growth expert and CEO of New York City-based strategic consulting firm Mindstorm.
A small business that takes a page from larger corporations and creates a board of advisors will have a competitive edge, he says. Here’s what you should consider as you assemble your board of advisors:
Do they have a variety of perspectives?
Finding advisors with industry knowledge and expertise is crucial to a small business, says Athan. These are the folks you will rely on to share their experiences of running companies similar to yours. Not surprisingly, they’ve also navigated some of the same problems and can guide you as you look for solutions.
But don’t rely solely on industry insiders. “Having a board with a wide range of experiences allows you to borrow ideas from other industries or projects, often leading to breakthroughs in your particular sector,” he says. A diverse board gives you the ability to have fresh eyes when viewing problems and solutions.
Do they have a mix of talents?
It’s impossible to have strengths in all the areas that are required to run a successful company. Your board should function much like a “mastermind” group, where you have a wide range of skills represented. Some core competencies you might consider including are:
- A marketing professional who can help identify creative ways to reach your target market.
- A financial expert to help establish a strong balance sheet and cash flow strategy. Also look to this advisor for help identifying potential financing options, as well as a possible exit strategy.
- A business psychologist or coach to help bolster your leadership skills.
- A growth consultant who can help you avoid the pitfalls of rapid expansion.
- Well-respected and connected business people who have contacts that will help you create alliances with complementary businesses, as well as provide a pipeline for top talent.
“Networking with other professionals like this will help improve your reputation and expand your reach,” says Jonathan Poston, an Oakland, New Jersey-based consultant who holds a master’s in entrepreneurship and is currently working to recruit advisory boards for boutique start-ups weddingbandsforboth.com and 99centrazor.com.
Do they buy into your mission and plan?
While you want to encourage a certain amount of “devil’s advocacy” when recruiting advisors, overall you want board members who are inherently rooting for your success. “I look for people who are passionate about dance and the arts, as well as our specific mission and vision, says Morgan McEwen, artistic director and founder of MorDance, a nonprofit ballet company based in New York City.
When recruiting her three most recent board additions, McEwen invited them to interview her as well. “I want our potential board members to know our long- and short-term goals and be aware of our finances, to ensure both sides believe they will be a good fit.”
Are they (and you) clear on their roles?
Many boards act exclusively in a consulting capacity, whereas others jump in and provide hands-on assistance. It’s important to know what you need your board to do—and what they are willing to do—before you bring them on.
Mordance’s board, for example, helps out in a variety of ways from volunteering at events and performances, to helping with bookkeeping and contract drafting and providing input on the season schedule. And of course, they are expected to be avid fundraisers, which is essential to a 501c-3 nonprofit. While for-profit companies might have a different mix of needs, often board members spend as much time reviewing and providing input on materials and plans as kicking around ideas in meetings.
What is their availability?
Strong boards don’t operate in a vacuum, so board members should be willing and able to attend in-person meetings. “The experience of each member in a group format creates a whole that is greater than the sum of its parts,” Athan points out. Ideas are built on other ideas, so availability to come together to bounce ideas around is essential.
The bottom line is that an effective board can help small business owners frame problems differently, see trends, test ideas in a ready-made focus group, and even offer a hard look in the mirror, says Poston.
“Yes, there are times you may want to fire them, but remember it’s why you brought them on board,” he says. “They are there to offer balance, insight, and perspective.”