You may be the leader of a company that is operating well, with great results, who quite reasonably asks “what real value can an Advisory Board bring to my firm?” I love this question.
The truth is, value is created by an Advisory Board shows up in your immediate results: savings in expenses, immediate growth, cash flow adjustments, but the larger value is actually created by making your company and its success sustainable over time.
Changes in immediate results usually come from more accountability to do the things you know the company should do, but for a variety of reasons (fear of risk, distraction, internal debate) doesn’t seem to get to. The board process cuts down on that slippage. Value also comes from the contacts, wisdom and experience the external board members bring. The quality of decision-making is improved, and flawed decisions are less likely to be made. With an Advisory Board, one is less likely to double down on a bad idea due to investment made so far or impact on ego.
However, even more important is the value created by moving the leadership conversation and thinking of your company up to the strategic level – creating focus on things which are less urgent, but often more important. Things like leadership development, strategic planning, and improvements in systems and processes to meet the challenges of the coming years. Without an effective board process, these considerations are often left to the last minute, and decision quality and implementation suffer.
You may also be wondering whether having a board will add a lot of work for you, and take up valuable time. A fair question. My response is “if you could spend 98-99% of your time working IN the business (day to day tactical and operational focus), and 1-2% working ON the business (strategic, developmental work which builds the companies strength and sustainability), does that seem like a fair balance?” Realistically, most boards only meet for part of a day about 4 times each year, which is not too high a price to pay for ensuring the business is on track, healthy and continuously building capacity for the future.
The other question I hear is “won’t this cost me a lot of money?” In fact, boards are very affordable and cost less than most owners think. If you think about the value they create in your business (both for today and the future), the investment in a board only makes sense. We have designed and set up boards for dozens of companies, all of which are concerned with safeguarding the bottom line yet, once created, not one of these boards has been shut down, even after many years of operating. I believe this is the best testimony to the value created by boards for entrepreneurs and private company owners. If these boards were not creating significantly more value than they cost, there is no question that they would have been eliminated.
Interested in hearing more? Call us for a discussion or with any questions you may have.