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So who asked you?
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Location: Blogs Speaking of business..." |
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| Posted by: Dr. Philip R. Geist |
10/8/2007 3:05 PM |
There's a lot of bad advice, or at least unwanted advice, available without the asking but when it comes to your business you need qualified advice that you can trust. Luckily, some great advice is available from people who will "work for food."
The President has his Cabinet and national advisors, big businesses have Boards of Directors, and local government has citizen advisory boards to provide informed and non-biased input, but most small businesses "go it alone." They are missing out on the knowledge and experience in the community that can help them avoid costly mistakes, increase profitability, and outshine the competition.
Small business owners can benefit from creating an advisory board composed of members with expertise in one of the functions the business must perform well to prosper:
- Production, acquisition, or development of what the business will sell
- Marketing the business and business concept
- Sales of the good or service
- Finance, including recordkeeping and tax payment
- Human resources, including recruitment, training, and retention
The above are just the basic functions required for a business to thrive. We can add several more to the list which will vary depending on the type of business: research and development, strategic planning, site location studies (for initial or subsequent branches), and so on.
Small businesses can ask experts in each category above to sit on an advisory board. Unlike a board of directors, advisory boards have no liability as their recommendations are not binding. Ideal advisory board members will provide additional skills and technical knowledge, have influence in the community or industry, and be able to provide networking opportunities. Potential advisory board members are accountants, advertising representatives, attorneys, bankers, engineeers, suppliers,... whoever meets the above qualifications.
How should an advisory board and board meeting be structured? Some "rules of thumb" are:
- No more than one person from each disipline (accountant, lawyer, engineer, etc.)
- Mutually agreed meeting frequency, duration, and time agreed in advance. (Remember, the members have their own business or profession as well as life to deal with too!) A common arrangement is to meet quarterly for two to three hours.
- An agenda should be created in advance and circulated to board members.
- The meeting location should be fixed, so travel time allowance is constant, and directions are unnecessary.
- The agenda should allow "open discussion" time for members to share thoughts and information that was not on the specific agenda for that meeting. This can be accomplished with a "roundtable discussion" as the last item of the meeting.
- Financial and sales forecasts and past performance should be shared with the board in detail. The more specific they can make their advice, the more applicable it will be.
Where does the "work for food come in?" As the board will be unpaid (paying can create a liability for advice given on the part of the board members which both you and they will want to avoid), one way to compensate them is to provide a meal before, during, or after the meeting. The mechanics of this will depend on the wishes of the majority of the board, as well as the time and location of the board meeting. Some restaurants have small meeting rooms suitable for meetings. Other options are a catered buffet in the company's conference room, or even the entrepreneur's home.
If you haven't used an advisory board, consider trying one. The experience and insight that board members bring to your business can make the difference between and ordinary and an outstanding company.
Bon Appetit! |
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