Today’s entrepreneurs are challenged to make more financial, tactical, and technological decisions every day. As their organizations grow, so do the costs of making a wrong decision as well as the rewards of making the right one. As a result, small to mid-sized business owners are recognizing the value of tapping the expertise of executive advisory boards. “You need advisors to bounce ideas off, to provide a reality check, to tell you when you’re about to mess up, to confide in when you’re alone at the top,” says BusinessWeek article, Don’t Go It Alone: Create an Advisory Board.
CEOs who seek the advice of a few well-chosen individuals have the advantage of an honest, objective sounding board that provides confidential counsel and penetrating insights which will bring solid value and return on investment. These boards can also be instrumental in helping a CEO communicate his or her strategic thinking into a formal plan to be shared with the management team. At Dinte Global Executive Search, we have seen advisory board members’ wisdom and experience become invaluable when organizations are evaluating IPOs, exit strategies, mergers, acquisitions, succession planning, and new market development. Yet, an advisory board has no power base or decision making authority. It serves as an adjunct to the CEO and management for the exclusive purpose of advice, guidance, and support.
However, as it is the case with any senior executive, selecting an advisory board must be done with great care. It isn’t just a simple matter of assembling the biggest names you can find, dubbing them board members, and expecting success. You need to be personally committed to the necessity of sharing in depth company knowledge with non-shareholders, to the concept and purpose of an advisory board, and to the search process required to establish a strong group of advisors.
After a thorough analysis of your business situation and requirements, appropriate board members should be selected based on their general management expertise and areas of specialty. It is also important to ensure that board members balance and complement one another in terms of style and background.
Over the years, Dinte Global Executive Search has had remarkable success helping clients assemble advisory boards consisting of the kind of top-drawer executives they may not have otherwise been able to attract. As a result, they are making better decisions, reaching their goals faster, and running more efficient organizations.
How does your organization benefit from advisory boards?